For online buyers and sellers of digital goods and services to the EU, 1st January 2015 will bring some big changes.
Specifically, sellers will be obliged to charge VAT (IVA) at the rate of the country that the *buyer* is present in – not the rate of their own country.
This includes UpdraftPlus. From January 1st 2015, buyers of UpdraftPlus in the European Union will be required to pay VAT, at their local rate, when they purchase. A VAT receipt will be issued when they do so. Buyers outside the European Union are not required to pay VAT – nothing will change for them.
A fuller list of requirements is:
- Identifying the customer’s location and collecting multiple pieces of evidence
- Applying the correct VAT rate
- Validating VAT numbers for B2B transactions
- Having the data needed to create returns.
There are also rules about keeping the data – and of course, the accounting rules for submitting the data at the right times to the right people (including the system known as “MOSS”).
We’ve been working hard on compliance with this new law, for our own systems, and for others. Since there were no existing solutions for WooCommerce-based shops (like UpdraftPlus), our sister company has been busy creating one!
A free “WooCommerce EU VAT compliance” plugin is now available for users of the popular WooCommerce e-commerce plugin for WordPress; you can get it by following the link.
They’ve also been working hard on a Premium version, with more features and convenience. It’s not yet on sale, but when it is, full information and the ability to buy it will be available here. (Until then, you can get more information on the page of the free plugin).
David Anderson (founder, leader developer, UpdraftPlus)
