Printful VAT Compliance Confusion (UK Seller)

[tyrra0001]

Hello,

I am starting my first business and wish to trade across Europe, however I am finding it very difficult to establish my VAT compliance commitments and this despite contacting a number of well established tax consultants who either don't know the answers or have supplied erroneous and conflicting information

My company is established in the UK but uses a clothing and printing supplier who has bases in Latvia and Spain

This supplier does not hold stock for me but they produce to order and the goods are then pass to a shipper to deliver to the end customer, I take ownership of the goods when they are accepted by the shipper. The end customers can be anywhere in the world including across the EU

The supplier will send an invoice to me in the UK with VAT zero rated

So in effect ,the producer of the goods is in country A

My company is in the UK, say country B

The consumers are in country/countries C

So the goods will move from country A directly to the consumers in C

I believe that I have to do the following;

1. Sign up the union OSS
2. To do item 1 I need to be VAT registered in a member state of the EU and I have chosen Spain because a company called Simply VAT is able to register me in Spain and file the Union OSS returns on my behalf

What I am not clear on is whether I also need to register for VAT in Latvia?

Could you please advise on the correct course of action that I need to take

Thank you

[Taxdoo]

Hi Tyrra,
If you are using the OSS, you don't need a VAT registration in Latvia unless you are storing goods in Latvia. 

If you are open to it, you can book a free demo with Taxdoo through this link to get all your questions on UK and EU VAT + accounting answered. Our tax experts will present a customized solution that fits your specific case.

Taxdoo has a fully automated and simplified VAT and accounting solution for Shopify merchants. Check out our listing here:  https://apps.shopify.com/taxdoo

[tyrra0001]

I wouldn't be storing goods from Latvia but I would be purchasing goods from that country.

[sharonlee123]

VAT compliance can definitely be confusing, especially when it comes to international sales. As other community members have suggested, it's a good idea to consult with a tax professional or accountant who can help you navigate the complexities of VAT and ensure that you're in compliance with all applicable laws and regulations. Additionally, some third-party services like Printful may offer support or resources to help sellers understand their VAT obligations. Best of luck as you work to stay compliant and grow your business!

[tyrra0001]

Unfortunately I've contacted Avalara, SimplyVAT, Hellotax etc and they're all giving conflicting information. Printful also have incorrect information on their website too. I'm just feeling very lost with all of this and want to give up.

[kr701]

Hi Tyrra0001, have you found a way? I had the same experience as you. 😞

[tyrra0001]

Not quite yet, I've paused all my sales to the EU for the time being. I've just recieved a report from a tax consultant. It cost me £2700! I would like to chat more about it with you and share my findings.

[TeemuEAS]

That is just terrible!

Tyrra0001, just get in touch with us via our website meeting link (can't post it here, shopify doesn't like it). Although we are experts in international taxation and tech, we don't speak consultant. We only make money when you generate cross-border revenue, you are in good hands 🙂

[TeemuEAS]

I feel for you Tyrra0001, there is a massive amount of disinformation out there. 

Legally the fact the goods are not sent to you but a customer creates a warehouse for you at the production facility country. And that requires a VAT registration, always. Not heavily enforced, but it is a legal obligation. Since to our knowledge you cannot choose the production facility, you should be VAT registered in all possible countries. 

To sell to another EU country you should register for OSS in the a country of VAT registration. 

Your company being outside of EU does not change the obligations. 

If, however, you choose to do things like I presume most non-EU customers of Printful do, just leave it to Printful to handle you should be aware you will participate in their under reporting and payment of taxes. They will use their own OSS to report the goods and use the selling price to you as the basis for taxes when it should be the selling price to end-customer. 

To make things easy for you: https://apps.shopify.com/eas-eu-compliance