Often times developers want to sell their wares, be they themes, plugins or other enhancements in order to make a semi passive income. There are rules and regulations attached to these and one of the most onerous and difficult to get your head around is EU VAT. As a global marketplace, we have you covered.

Where ever you are in the world, VATMOSS applies to you if you sell digital products that can be downloaded via a link, email or digital payment function. Don’t be misled, if your products are on a Marketplace, EU VAT MUST be charged to EU Registered Citizens and Companies and, accounted for.

For Vendors, Elegantmarketplace.com do this on your behalf so you do not end up liable. If the marketplace you are listed on does not charge EU VAT on each and every one of your downloads, you as a vendor become liable and its only a matter of time before the Tax Man comes knocking on your door. In point of fact, any website that sells digital downloads MUST charge EU VAT so, be wary of those that do not declare or account for EU VAT to European Registered Citizens.

It can sometimes be confusing where and when a seller of digital services like themes, plugins or other digitally delivered documents including zip files are electronically delivered should charge EU VAT – here’s advice for non EU registered companies.  If you are a UK based service – like us – these rules apply. 

In short, EU VAT rules are easy to comply with although it does add a cost to your accountants fees and calculating the VAT due – however, they do make your products less attractive to the consumer if say, your products are available on your own platform and you do not charge EU VAT (you should be) or if they are on another marketplace that is not charging EU VAT (they should be) as a seller, this can have a negative impact on you as you may well have 28 countries – currently 😉 demanding up to 27% of your charges to cover your sales.

Simply put, Elegant Marketplace charges EU VAT – this means that any company registered in The EU and has a VAT number can claim it back via their own channels. If a company or individual is not registered for VAT the price increases for them – unfortunately, rules are rules and as a marketplace, it is our responsibility to act in such a way that we are on the right side of every tax law there is and to protect our vendors from any VAT tax liability that they may not be aware of.

As a vendor and a customer, we like to think we protect you in all your transactions with us. We charge VAT where appropriate, account for it, and pay it on time, every time.

As members of the VATMOSS scheme, we simply upload our Taxable charges and the system makes sure each EU country is paid the right amount and, that any EU company that has claimed EU VAT back has a record of where and when it was charged and by whom.

This saves our vendors worrying whether they are liable for VAT, ensures that we act appropriately as a UK registered business and it keeps our accountants happy as we have no TAX surprises.

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Andrew Palmer
Andrew is the founder of Elegant Marketplace.