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EU Tax Challenges for Creators This is a running documentation of me figuring out how to bill, collect, remit tax as an online course creator
#ODCC1
In EU 
tax there's a concept called 'Place of Supply'
You pay tax in the country where your business is based == where sell the product
This does not apply for digital products
In that case you have to pay tax where the customer is based
tax there's a concept called 'Place of Supply'You pay tax in the country where your business is based == where sell the product
This does not apply for digital products
In that case you have to pay tax where the customer is based
Example:
* I sell online courses
* I have customers in Germany and Ireland
This means:
Add 19% VAT rate to the invoice for German customer
Add 23% VAT rate to the invoice for Irish customer
The VAT table looks as follows
* I sell online courses
* I have customers in Germany and Ireland
This means:
Add 19% VAT rate to the invoice for German customer
Add 23% VAT rate to the invoice for Irish customer
The VAT table looks as follows
I can solve it as follows:
A) Manually: Create each invoice by hand and have my accountant calculate + remit the tax obligation for each country separately
B) Automatically: Implement a tech solution to take care of it
Wouldn't it be nice if Option B were easy?
A) Manually: Create each invoice by hand and have my accountant calculate + remit the tax obligation for each country separately
B) Automatically: Implement a tech solution to take care of it
Wouldn't it be nice if Option B were easy?
Gumroad + Paypal: Does the trick
Pro: Easy to spin up
Con: Paypal's fees are intransparent and way too high https://twitter.com/artlapinsch/status/1377627087708753921?s=20
Pro: Easy to spin up
Con: Paypal's fees are intransparent and way too high https://twitter.com/artlapinsch/status/1377627087708753921?s=20
Paddle: The solution w/ a caveat
Pro: Start-to-finish revenue delivery platform + takes care of tax calc + remittance
Con: Doesn't seem to integrate with all online course platforms (i.e. Podia++)
Pro: Start-to-finish revenue delivery platform + takes care of tax calc + remittance
Con: Doesn't seem to integrate with all online course platforms (i.e. Podia++)
Stripe: The big fish but with a recent acquisition
Pro: Integrates with all platforms
Con: Doesn't support EU VAT calc/remittance yet
My buddy @ChrisSamiullah shared that Stripe acquired TaxJar - Definitely a move in the right direction https://www.indiehackers.com/post/yes-stripe-acquires-taxjar-53db5c21d1
Pro: Integrates with all platforms
Con: Doesn't support EU VAT calc/remittance yet
My buddy @ChrisSamiullah shared that Stripe acquired TaxJar - Definitely a move in the right direction https://www.indiehackers.com/post/yes-stripe-acquires-taxjar-53db5c21d1
My friend @nikwen_de shared this interesting discussion on IndieHackers
It is a comparison between Strip & Paddle https://www.indiehackers.com/post/stripe-vs-paddle-89161b0d5c
It is a comparison between Strip & Paddle https://www.indiehackers.com/post/stripe-vs-paddle-89161b0d5c
Fantastic writeup by @iwootten - he compares
@Stripe
@PaddleHQ
@quaderno
@gumroad https://www.ianwootten.co.uk/2021/02/23/comparing-vat-solutions-for-bootstrapped-uk-businesses/
@Stripe
@PaddleHQ
@quaderno
@gumroad https://www.ianwootten.co.uk/2021/02/23/comparing-vat-solutions-for-bootstrapped-uk-businesses/
Steven from @goodandprosper as well as @DominicZijlstra pointed me to VAT tax exemption schemes IF sales are below a certain threshold
As a DE sole proprietor it seems that educational product sales below <17.5k are exempt from VAT. https://europa.eu/youreurope/business/taxation/vat/vat-exemptions/index_en.htm
As a DE sole proprietor it seems that educational product sales below <17.5k are exempt from VAT. https://europa.eu/youreurope/business/taxation/vat/vat-exemptions/index_en.htm
@_karimelk would love to hear from you if you came across this problem + how you/your clients are usually going about it.
