Hi! I have started my first Shopify store but I’m not sure about the VAT/import duties. I live in the Netherlands (EU), I have a Dutch VAT number and I sell Limited Edition Giclee Fine Art Photo Prints World Wide using the PRINT SPACE. They have printing labs in Germany (EU) and London (UK). My questions:
Since I’m starting, I can probably register as Micro-business exemption (in the EU there’s a threshold until 10.000). However, it’s not clear to me if I can sell to other countries outside of EU (like UK, US or South Africa) as well when I use this Micro-business exemption for European Union. Is that possible or not? It says the following: ‘To add countries, change your VAT registration from micro-business exemption.’ That’s why I’m doubting.
Other parts of the world and especially South Africa, Kenya, UK, Canada and US are also clients so I’d like to know how I can make the VAT & IMPORT DUTIES work for world wide delivery without having to upgrade to the Advanced Shopify.
If you have a VAT number, to my understanding you would be VAT liable regardless of whether you have reached the threshold or not. Your company registration type does not have any effect on liabilities in other countries. In order to sell throughout EU you should register to OSS, which you can do via your Dutch tax admin portal. With OSS there are no value thresholds. If you are shipping from UK to EU, you should also register for IOSS in EU. To sell Low Value Consignments (<135£) to UK, you should register for UK VAT at https://www.gov.uk/register-for-vat/how-register-for-vat, and if you are shipping from UK, you will need the registration in any case. For US and S-A I don’t have such clear instructions.
Take advantage of the simplified VAT schemes whenever possible. They allow for simplified customs process, collection of VAT at checkout and basically better customer service. When not applicable, talk to your logistics partner about DDP solution. That reduces the costly returns.
As for shopify version we make even basic plan work. In general, the advanced plan really is the thing for cross-border.
And now a word of warning: some print-on-demand companies are simply wilfully and knowingly avoiding taxes with their solutions. If you want, just talk to us and we will make sure you are compliant.
Forgot about German production unit: Because it is your company in the end-customer receipt and the print-on-demand company invoices you for the goods, this will form a warehouse for you in Germany. And, again, storing goods in another country will require you to have a VAT registration in Germany.
And again, if you need more assistance we are here for you!