I’m a new UK seller , I sell to UK,USA, Australia Canada and EU , I don’t take over 85k in fact only just started so don’t have to register for VAT in UK. However I want to know firstly do I take tax off of customers just in other countries and not UK, do I just not take tax at all ( will this annoy the other countries) and do I have to take tax on digital downloads as I heard about new laws about these. how do I find out rates for different counties and places as I heard USA has loads of different tax bands.
If I take taxes does the money go straight into my bank? if so how do I know what’s tax and what’s my profit?
finding this all so confusing and PS I’m a grandmother and a home from home dog boarder, so tech is not my strong point.
Really hoping someone out there was once in the same boat and knows what to do as I don’t want to get in trouble or anything.
Hi,
All destinations have different ruls and that is why you should be careful how you handle these issues.
Save approach is to send everything DDU to other countries, but that negatively imapcts your customer relations. Nowadays everyone wants to know how much merchandise would cost them at the moment of the sale.
But customers behave differently: USA customers are ok with tax exclusive prices and they are accustomed to GS/use tax being visible only at the checkout or paid later (if we talk about use tax) . The very fact that you are not registered for VAT in UK (being a small business) does not mean that you merchandise is not taxable in other countries. If you start any solutions when you collect taxes (VAT/GST/GS) you will receive the taxes to your account as part of the payout and would have to pay the taxes to respective tax authorities based on your registrations and other arrngments. I am only giving a general answer since going into detailes would take much time.
In EU you customers will have to pay VAT and VAT+customs duties depending on the order value. The process of collection/ payment depends on wthether you are registered for IOSS special VAT scheme and your arragements with shipping companies (you can deliver orders DDP and DDU).
The easiest way to sell to EU nowadays is to register for IOSS and make up your mind on DDP/DDU solution (which also may be influenced by Shopify plan that you use)
We can help you with IOSS registration , visist us at www.easproject.com and register for free IOSS number. We will provide support on the abouve issues based on the praticulars of your store.