Which app or service are you using for your sales?

Selling through the app store seems easy - then everything (like VAT etc) is being taken care of. But not everyone wants to buy via the app store (especially true for academic departments), in which case you need to write and send a bill, deal with tax, etc.

How is everyone doing this? Do you write your own? Do you use a 3rd party app?

And how do you deal with selling to different countries? Do you need a tax declaration for each country you sell to? Or use a payment processor to take care of it?

Markus

For App Store from Apple, you get a payment every month.
You can write an invoice for that payment with Apple’s billing address and VaT ID, but Apple does not need a copy of that invoice.

Your clients get an invoice from Apple for purchase, not from you.

If you sell through Share-It or Fastspring, they write invoices for clients, too.
They collect VAT and send it to the tax departments.

You only get a payment once a month.

I use FastSpring and they handle all the taxes. I usually get payments every two weeks but that might be a setting.

Question… If one were to sell their apps directly (ie. no MAS, no Fastspring etc…), just via Paypal… by what authority does the EU (or any other foriegn country) have to force me to deal with their convoluted VAT tax system? Isn’t that a legal commitment on the customer who is a citizen of said country?

@Markus Winter: Aquatic Prime + Fastspring. Fastspring has people, who actually think. They have always helped when there was a problem.
@Dave S: they can’t. It’s only convoluted because you think inches and miles are normal. I let Fastspring handle all this and I only tell my tax person to trust Fastspring. No headaches for me. Just for giggles try to find out how to calculate a Rentenanpassungsbetrag, which I had to do for the mother.

VAT is Value Added Tax.

The customer pays a price which INCLUDES VAT.

In a chain a business buys ($100) and pays VAT, then sells ($200) and receives VAT.

The VAT it pays is credited to them, the VAT it receives must be passed on to the state. So the business pays VAT on the value it added.

So unless you as a customer want to separately pay VAT each time you buy a coffee, sandwhich, fill your car, buy a ticket etc instead of having it included in the price …

P.S. And yes, at each step VAT is being paid, and at the end the customer pays it all again, e.g.

Price: $0 -> A -> $100 -> B -> $200 -> C -> $400 -> customer

A: VAT credit: $0
A: VAT to pay: $20
VAT: $20

B: VAT credit: $20
B: VAT to pay: $40
VAT: $20

C: VAT credit: $40
C: VAT to pay: $80
VAT: $40

Total VAT paid to the state: $80 aka what the customer at the end paid

Markus… I understand (conceptually) what VAT is and how it works (within the EU)… But if I sell a product (which I have many times) to a citizen of the EU… I charge them $X (US)… and get that entire amount (minus Paypal fee)… at no time to I mention VAT, care about VAT nor does Paypal. By that same token… I don’t attempt to deal with US sales tax either (with while not as complex as VAT, is still not straight forward, as some states have sales tax, some don’t, some cities add on top of the state tax etc… meaning there is no way I could even “know” what tax to charge, let alone how to collect it, report it and “pay” it to the correct agency

one of the benefits of being a rebellious colony :smiley:

Actually it is YOUR responsibility to find out and make sure. And people use payment processors exactly because it is such a hassle. What you are actually saying is something that I wouldn’t be saying on a public forum.

Btw not long ago someone here on the forums posted that he got a big fine because he didn’t want to pay for a payment processor and used the wrong VAT for a country after they changed their rate.

I myself once got a letter from the tax department about a contract I did about 7 years earlier and was asked to supply documentation on the tax I paid (which luckily I was able to do). Especially when the public purse is empty they start looking for tax to collect with a very fine comb, and you know the state of the US finances …

Weird, because in the US it is the consumer’s responsibility to report online purchases that were not properly taxed.
Does it not work the same way over there, where if you buy something online that didn’t get taxed you have to report it?

Markus… please read my original question…
I am a citizen of the United States… I have no legal responsiblity to know the tax laws and/or requirements of what is to me a foreign country…

As to US Sales Tax (which is vastly different than VAT)… most internet sales from indiviuals usually skirt the need to do all this, as they are not established businesses (ie. corporations/companies)… even Amazon didn’t collect sales tax until just recently, and then only because they opened physical locations in most US states. At one time they even threatened the State of California, that they would cease doing business there , and California backed down.

[quote=342492:@Tim Parnell]Weird, because in the US it is the consumer’s responsibility to report online purchases that were not properly taxed.
Does it not work the same way over there, where if you buy something online that didn’t get taxed you have to report it?[/quote]
Not that anyone does :slight_smile:

[quote=342494:@Dave S]Markus… please read my original question…
I am a citizen of the United States… I have no legal responsiblity to know the tax laws and/or requirements of what is to me a foreign country… [/quote]

That is only true as long as you do not do trade with these other countries. If you have business dealings then you are bound by the laws of those countries too (eg health laws, environmental laws, safety laws, customer protection laws, etc). Extreme example: selling weapons to pretty much anybody might be legal in the US, but do that to customers in other countries and their police comes down on you like a ton of bricks. The exact nature of the tax situation is dependent on the trade agreements between the respective states.

Don’t assume that US law overrides everything. It doesn’t. You still have to obey the law of the countries you visit or deal with. And the Internet’s “Wild West days” have been over for some time.

So saying “I’m a US citizen so I don’t have to do squat” is a rather lofty attitude that could come back to bite you. But I’m no expert, and if you want to play the “I’m too small a fish anyway” card then who am I to argue. I just wouldn’t post this on a public forum.

Btw many people also thought they don’t need to pay for a MySQL license for their business …

And thanks to everyone who chimed in. Your advice is much appreciated.

Speak to an accountant, not a programming forum :slight_smile:

The is a tax agreement between US and EU.
That is the reason I can avoid tax in US for sales when I fill a form declaring myself.

Reciprocal tax treaties
Talk to an accountant & possibly a lawyer who knows about this stuff

Paddle.com they deal with that crap for me.

+100000

I use FastSpring because a) They handle the tax stuff for me (I’m a dual citizen of the US and UK and don’t want any funny games when I go back from time to time :slight_smile: Highly unlikely though) and b) They have a sandbox/mechanism so I could test my pages and reg code generation etc. Paddle didn’t at the time.