Tag Archives: eservices

Feautured article: Tax Planning International: Indirect Taxes – World Wide VAT forum: E-commerce

In April 2013 we have organized a workshop for our clients where we have presented the current and future ecommerce legislation in Switzerland, Europe and worldwide, discussed tax related trends among ecommerce businesses and tax authorities and presented our vies of the future cross-border tax and business implications for ecommerce. We have spent quite some time discussing how the ecommerce tax compliance will need to be modernized and automatized in order to meet the requirements of the ecommerce businesses of tomorrow and presented our vision on how to meet this goal of automated, scalable, seamless and affordable tax compliance service offering.

As a follow-up to the workshop we have prepared and publicized an article in the May 2013 edition of Tax Planning International: Indirect Taxes. For your convenience you can download its copy here.

USA: Washington state issues new regulations on software and digital products

The Washington Department of Revenue released new regulations on the taxability of software and digital products. The two new regulations, WAC 458-20-15502 and -15503 were adopted February 25, 2013, and became effective March 28, 2013.  The Department issued the new regulations to clarify the impacts of previous legislation taxing digital goods and to address other tax issues related to computer hardware, software, and computer services. Taxpayers engaged in selling software and digital products in Washington should review these regulations as they may provide clearer guidance for distinguishing between taxable and nontaxable digital goods, software, and services. [Computer Hardware, Software, and Digital Products, Washington Department of Revenue, WAC 458-20-155/15501/15502/15503] Find out more

USA: Another step towards Internet Sales Tax

US Senate has passed the Marketplace Fairness Act yesterday which aims at introducing collection of online sales tax in the US directly from online retailers.

Next stop: House of Representatives.

Here is the link to the text of the bill passed by the Sebate on 6 MAy 2013 and here an article which nicely summarizes pros and contras of the proposed bill.

 

 

 

 

US: Internet Sales Tax is coming?

It might well happen that in the not so far future all US online vendors with over $1 million in annual online revenue will be required to pay state and local taxes to the governments that their customers reside in. There are more than 9.600 different state and local tax jurisdictions within the US. This news makes issues related to the upcoming EU VAT 2015 ebiz changes look like a piece of cake.

A federal Marketplace Fairness Act was submitted to the US Congress in February 2013 and aims to substantially reform the taxation of the ecommerce industry in the US. PwC’s summary on the bill can be accessed here. For some more information on the taxation of internet transaction in the US we suggest you to read this report. Find out more

EU: Mini one stop shop 2015 – the basics

Today we will take a look at the basics of the new Mini One Stop Shop (“MOSS”) VAT registration scheme and compare the EU and non-EU MOSS schemes with their alternative – the “standard” local VAT registration in up to 28 EU countries.

As you are most probably aware companies selling telecom, broadcasting and eservices to B2C customers in the EU will have to charge VAT in the country of the customer and at that country’s VAT rate. This will mean 28 countries and 28 VAT rates (or 56 rates if ebooks and similar eservices will potentially become taxable at reduced VAT rate).

Find out more

South Africa plans to implement madatory VAT registration for foreign businesses selling digital products to SA clients

South African National Treasury has proposed that foreign businesses, which sell digital products to South African customers, be required to register for VAT purposes in South Africa.

The VAT implications of digital product sales, including books and music sold via the internet by suppliers who are neither resident nor established in South Africa, have caused uncertainties and resulted in VAT compliance risks for these foreign businesses.

For your convenience has therefore the National Treasury proposed in the 2013 Budget Review (which was released on 27 February 2013), that foreign businesses supplying ebooks, music and other digital goods and services in South Africa be required to register as VAT vendors.

Find out more

USA: Webcast – EU 2015 B2C VAT changes and what they mean for US based businesses

Please join PwC’s Value Added Tax Practice for a webcast on Thursday, March 14th from 12:00 to 1:00pm ET.

Webcast will focus on the challenges that sellers of electronically delivered content face when selling to customers in the European Union and elsewhere.

The European Union (EU) has long required EU established businesses to account for VAT, at the rate where the business is established, on sales of electronically supplied services (eservices), such as mobile applications, downloadable or cloud accessible games and music, and subscriptions to websites, to private individuals located in the EU. Find out more

EU: How to define the location of an ebiz customer?

In today’s article we will take a look at information the EU Commission suggests that should be collected and used to determine the location of the customer – buyer of eservices. We will also analyze the practicability of the various proposed location evidences and think about how easy they are obtained in practice.

As you are probably aware, at least as of 2015 every business supplying eservices to non-VAT registered customers in the EU will have to charge VAT in the country where its customer is located. In a number of cases this rule already applies (e.g. if the eservices are supplied by non-EU companies to EU customers or if they are supplied to Swiss, Norwegian, etc… customers).

Find out more

Our ebiz Due Diligence experience: When VAT becomes a material issue

In this article we attempt to explain in a simplified way the impact VAT can have on determining the purchase price of an ebusiness company during a due diligence process. This should be of special interest for investors investing in ebusinesses and also for owners of a start-up when planning to gain additional capital or when playing with the idea of selling their companies some time in the future.

We have explained in previous posts that as of 1.1.2015 all ebusinesses providing eservices to non-VAT registered customers in the EU will have to charge VAT at the rate applicable in the EU country the customer resides in. Find out more