The EU VAT thing…My take on it all

The holidays are upon us Whooopppeeeee”! But there is something that we need to think about for 2015 right now.

Long post, this…but it’s pretty important if you sell or plan to sell digital products online….

 As you are probably aware, the lovely EU (European Union) are starting their new policy for sales in the EU for downloadable digital products starting on 1st January. If you sell your own digital products, you need to take notice.

NOTE: This is NOT just applicable for EU residents. If you ever sell even one $1 product to anyone in the EU you need to read this..wherever you live
NOTE 2: I am not an accountant, a tax specialist or a lawyer. This is just my take on things, OK?

In this post, I would like to outline what the changes are (in simple terms), your options to continue to sell into the EU (and don’t forget that includes the UK – a MASSIVE market for digital goods) and what I think is the easiest way to deal with it.

1. What are the changes?

Rather than making this a super-long essay, I am going to link to a site that gives the full details >> Here

Basically, you will need to account for all of the VAT that you add to your products based on where they are bought (and VAT rates are different in each EU state) and remit the VAT you have collected from the customer to the revelant country. There is a way of simplifying the process called the VAT MOSS (mini one stop shop) whereby you register in one country and that will pay all of the others for you. There is a similar scheme for non-EU based businesses too.

But that is not the big problem. The big problem is having systems in place to make sure you account for everything properly


2. Here are your options

a) Hope that no-one will notice and ignore the whole thing. I know quite a few folks who plan to take this route. However, it seems that many of the EU states are quite prepared to levy high fines and penalties on transgressors.

b) Play a straight bat and do what they want. That would mean registering for VAT in, say, the UK as a non EU business, registering for VAT MOSS and maybe using a service like to handle the sorting & accounting for you.

c) Find a way to block all EU sales of your products. If you are in a EU country this would be illegal. If you are outside of the EU it would be madness as the UK (and Ireland) are MASSIVE markets.

d) Do the one simple thing that makes all this go away…. Sell through a “reseller”

So (d) seems the easiest, right?

But TAKE NOTE: Many “instant” platforms like Warrior Plus, Zaxaa and JVZoo are NOT resellers. They facilitate the sale that you make and their system administers the affiliates and commissions. If you sell via this type of platform you will still have to account for your EU VAT.

The easiest solution is actually provided by the biggest player in town that has payed out more than $3 BILLION in affiliate commissions and has over 1000 of it’s vendors become millionaires. Yes, I am referring to Clickbank.

As Clickbank is a reseller, it is Clickbank, not you, who is responsible for administering the correct VAT, collecting it and paying it to the relevant state.

If you don’t have a Clickbank account, you can get one here
>> Click for an account

If you want to benefit from a full and complete training about how to be successful selling on Clickbank, the company itself has a “University” course to teach you everything you need to know and more. This is delivered by a couple of Clickbank millionaires (and it looks like that they achieved that before having to learn how to shave, lol)

>> Get the Clickbank University Course here

Also there has been a free WP plug-in developed that goes *some* of the way to helping. I am not going to link to it in this post as, when I tested it, it didn’t work and it lacked vital functions. So I will keep you posted on developments.

In my next mail, I will let you know why I am seeing this whole thing in a very positive light.

But that will be after Christmas.

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1 ping

  1. Thanks for the heads up on this new VAT issue Barry and look forward to your update in new year.. Top Man… Merry Christmas & Happy New Year to you and your family… Many thanks… Del Williamson

    • Peter on December 24, 2014 at 2:36 pm
    • Reply

    Thanks Barry, great and useful info here. Happy holidays

  1. […] UPDATE Dec. 24, 2014:  The inimitable Barry Rodgers has written a really good blog post and offered another, definitely better approach to working around the VAT requirement — all completely legal and ethical . You can read it here:  The EU VAT thing…My take on it all  […]

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