VAT on Software

General
21

What do you all think about this logic (pseudo code)?

paysVAT()
{
    if ( seller registered for VAT){
        if ( customer in EU ) {
            if ( customer is a business ) {
                if ( customer in same country as you ) {
                    return TRUE;
                }
            } else {
                return TRUE;
            }
        }
    }
    return FALSE;
}
22

LOL I think your last return should be TRUE… You don’t have to be registered for VAT in uk to be liable for charging vat in other EU countries.

23

:D. The pseudo code is taken from https://successfulsoftware.net/2012/11/12/vat-for-software-vendors/

24

This conversation is about those changes made to VAT legislation in the UK in 2015, looks like the URL refers to 2012 legislation

25

It’s estimated that VAT fraud runs to about EUR 50bn/annum (VAT and CAP make the EU a utopia for organised crime), in order to address that the European Commission has proposed from 2022 all VAT for cross-border transactions will be destination based.

26

@Asis Patisahusiwa , I think the pseudo code above and on that website is wrong.

“customer is a business” doesn’t matter.
It’s more like this: “customer is a VAT registered business and has a VAT ID”.

27

[quote=367915:@Christian Schmitz]@Asis Patisahusiwa , I think the pseudo code above and on that website is wrong.

“customer is a business” doesn’t matter.
It’s more like this: “customer is a VAT registered business and has a VAT ID”.[/quote]
Thank you @Christian Schmitz.

Is there a specific organization to collect VAT from foreign software developer (outside EU)? I’m thinking, after collect the VAT without using any third party web service and then what? What will we do?

28

You have to pick a country in EU and register there as a foreign company.

Really, the paper work is not worth it, unless you have thousands of euro of tax to do.
For below that, better let someone else do the sales.

29

[quote=367919:@Christian Schmitz]You have to pick a country in EU and register there as a foreign company.

Really, the paper work is not worth it, unless you have thousands of euro of tax to do.
For below that, better let someone else do the sales.[/quote]
Thank you for the info.