Introduction to EU Digital VAT


New rules regarding the selling of Digital Goods to EU countries come into force on January 1st 2015. These rules affect both EU based and Non EU based suppliers.

The rules are meant to apply to business to customer (B2C) transactions and not Business to Business (B2B) transactions. To distinguish between the two, the suggested method is to ask the customer to supply a EU VAT number, in which case the transaction should be classed as B2B.

The new rules basically say that anyone selling Digital Goods to a EU customer must charge VAT on that sale at the rate applicable in the customers country. Furthermore, the supplier must either register in every EU country that they make a supply to, or register using one of the EU countries Mini One Stop Shops (MOSS).

Suppliers must then account for and pay the VAT on a quarterly basis.

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Last modified March 23, 2020 by Scott C Wilson (7eff069).