If you’re a WordPress ecommerce site admin or owner I’m sure you’ve heard and even seen some of the upcoming changes being made to EU VAT.
How EU VAT Worked Before January 1, 2015
Before January 1, 2015 if you sold digital goods online, you only needed to charge taxes at the rate from the EU member state in which your store is registered. For example, if you’re an author in Spain selling your ebooks online, you only needed to charge taxes applicable to Spain. In summary, you charged taxes based on the store owner’s tax rates.
Effective January 1, this will change.
How VAT MOSS Works After January 1, 2015
Online sellers will have to charge tax rates according to where the purchaser lives instead of where the store owner lives. This change applies to any and all ecommerce sites selling to users living within the EU.
From January 1 2015, telecommunications, broadcasting and electronic services will always be taxed in the country where the customer belongs… –European Commission
You’re now able to add tax rates for every member state of the EU right from Exchange, so your store can charge taxes accordingly.
The new VAT regulations apply to digital & downloadable goods such as:
How to Add VAT Rates for EU Member Countries
If you already have the EU VAT Add-on installed on your WordPress site, update to v1.1.0.
To add VAT rates, click the gear icon to access the settings screen.
Select the product type where the settings should be applied, then begin adding VAT rates to the member countries where people can purchase your products. When finished, don’t forget to click Save Changes for your rates to go live on your site.
You can add multiple rates for each country.
Additionally, when editing an individual product, you can enable VAT MOSS and select the rate for each country to be applied to that specific product.
- If you have questions about updates for the EU Value Added Taxes Add-on for Exchange, reach out via the Support Forum or Twitter and we’re happy to help.
- For more details on the EU VAT regulation changes check out the European Commission’s site.
- Scope of changes can be found on GOV.UK.