Thats the pre-Jan 1st situation IF you were above the VAT turnover threshold and registered with HMRC.

The new situation is a bit more complex, even for sole traders trading from their bedroom offices.

It's not, the guy downloads the app on paying his 79p and the seller accounts for the VAT element. Nobody knows or cares about anything else. It is of no interest to the bedroom trader whether the buyer is a foreign national, etc and would be wholly impractical and impossible for the trader to even attempt to ascertain this on a sale-by-sale basis. He'll just charge the default VAT (or his computer will) and that's that.

You might want to read this tangled web of complete bollax and do a quick search for some of the advisory platforms that accountants have set up, as I said it applies to digital media at the moment, next year its supposed to apply to all media, Vince is still sitting on his hands. rlhttps://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumersrl


Or from a small business forum https://www.smallbusiness.co.uk/financing-a-business/accounts-and-tax/2475862/eu-vat-changes-affecting-digital-content-and-eservice-sellers.thtmlrl

Have a quick read of rlthis blogrl. Heather Burns seems to have got it summed up pretty well

This us just another example of why the EU is dragging us all into an uncompetitive more. Small businesses general provide most employment growth but are disproportionately affected by regulation - not just tax but employment law, etc, etc which stifles growth and gives further advantage to big businesses. The EU is rapidly making its citizens poorer in a competitive world.

No, it's an indication of a less than useless Business Minister and a bunch of even more less than useless MEPs

How do you work that one out?

Vince Cable was aggressively lobbied about the potential implications to SMEs, he took absolutely no notice

Didn't one of the links explain that the UK has lobbied to try to relieve the burden on small business but to little avail?

Yes, the lobby was to try and enforce the standard UK turnover threshold of £80k (or thereabouts) on this legislation which would alleviate a lot of the problems that its going to cause, particularly next year, but the reason not to do so was that each EU country has its own threshold so it would be unworkable despite the fact that each EU country has its own level of VAT but that is not unworkable

One concession was made which was to keep the UK threshold for VAT registration for UK sellers trading within the UK but then they still have to register to sell in the EU, which is the sort of crazy thinking that politicians go through, "Oh its ok because you don't have to register, but actually you have to register anyway".

So how easy is it to trade in the EU - very easy, in fact its so easy that you have no control over where your goods are being advertised, nor should you want to if you are serious about selling online and if your product can be downloaded then it makes perfect sense to sell all over the world - and you can bet that everyone else in the world will be trying to sell into the EU.

What it will do of course is to simply increase prices of all goods by one hell of a margin, overnight, what that will do for inflation has to be seen but for me selling artwork online my prices in the UK will be the same but they will increase by the VAT margin to any state in the EU and the reverse is true for any european trader selling to the UK, their prices will increase by 20% at a stroke, thats one hell of a concession from Vince the small business champion although of course in the manner of all civil servants he probably thought that small traders would just absorb the VAT and carry on regardless.

One other thought on the subject for next year, the raw materials that I currently purchase for my product are purchased from high street retailers and just looking at one of their receipts they do not break down the VAT element to me as an end user member of the public because they don't have to, all they currently have to do in law is show their VAT number but they don't issue a member of the public with a VAT invoice.

Thats going to have to change

Because if a trader has to collect and submit VAT collected from EU consumers at no benefit to that trader, then you may as well go the whole hog and claim input VAT back, I would certainly want to do that because there is no way that I would be collecting VAT for a foreign government and not having some benefit to myself.

Just out of interest have you ever spoken to a VAT inspector and had their point of view and of how they are doing you a big favour by allowing you to collect their tax for them, I have, it was one of the funniest conversations I have ever had.

So not only will the retail craft establishments have to get used to printing the VAT content on their receipts but consumers, members of the public, may have to get used to seeing nett prices quoted on products, its normal practice for B2B to quote £xxx + VAT but not for retailers in a B2C scenario - if you are selling across Europe then you are commercially far better to quote nett plus vat rather than publish ten or fifteen vat inclusive prices.

Retailers normally issue simplified VAT invoices for sales up to £250 - which include VAT number, rates, etc So I am unclear of your point.

I'm sitting here looking at receipts from the likes of The Range and WH Smith both of whom are pretty much B2C outlets, no VAT breakdown on either of them, the only reference to VAT is their reg no, which is not a lot of use as a VAT invoice - they need to issue one like Staples who are used to dealing with B2C and B2B.

And another point I sell to a client in Ireland a couple of times a year where they have a VAT rate of 23%, so the price to him as an end user will have to increase 23%, this element is then passed to the Irish government via the MOSS portal which from everything I have read will simply do that, you register a sale, they calculate the VAT for you, bill you, pass the tax onwards, no mention of input VAT though - so presumably I make separate claims to the UK government for relief on my purchases (and why shouldn't I), nett result being a loss to the UK revenue ?