You have an obligation to be VAT registered when you exceed the annual turnover threshold set by the local tax authority.
It sounds like a simple ‘yes’ or ‘no’ question, ‘does my company need to be VAT registered?’ However, VAT requirements in each country can be slightly different and the VAT authorities don’t accept ignorance as an excuse if you fail to comply with requirements. That can lead to hefty fines and penalties from the VAT authorities.
The basic principle for Value Added Tax (VAT) is fairly straightforward. No matter if you are a sole trader, a limited company or a publicly traded company, you must be VAT registered in any county that is part of the VAT scheme: if you exceed that country’s selling threshold or store goods in that country.
Recently (July 2021) the EU’s distance selling threshold was changed to €10,000. Under this new VAT rule, any e-commerce business that sells its goods or services to their customers via the European Union (EU) must register for the new One-Stop Shop (OSS) VAT scheme. This allows you to be VAT compliant in EU member countries where you sell your goods but don’t store your goods in that country,
If you still aren’t sure if you should be VAT registered or if you need help setting up your VAT, contact our VAT specialist on +44 (0) 208-004-1160 in the UK, ++1 (714) 782-7000 in the USA or simply email us at query@MyVATdirect.com.
About My VAT Direct Ltd
My VAT Direct is a bespoke VAT registration, fiscal representation, calculation and filing service specifically designed to assist Amazon Sellers and e-commerce merchants who desire the benefits of cross-market selling without the worry of tax compliance in foreign markets.
My VAT Direct is comprised of knowledgeable and experienced tax experts, who for 10+ years have helped e-commerce sellers enjoy the selling opportunities a mass market can provide.
About SMBE Direct Ltd
My VAT Direct is a subsidiary of SMBE Direct, a world reaching B2B and B2C business services conglomerate, giving rise to exceptionally talented and well-experienced professionals organised into business units, that provide direct services to SMEs and enterprise level businesses, whereby increasing their brand awareness and sales.