Cross border VAT?
The rules for cross border VAT are applicable for more then 25 years since borders in the EU are removed. The business people had to adapt to the new situation and hear new terms like VAT treshold. The numerous VAT changes are responsable for the complexity and rising costs to be VAT compliant. Especially the fact when you do cross border operations and so you have to be compliant in many of the 28 EU member states.
When do we talk about cross border VAT? We speak about it when companies are selling goods and services in another EU Member State. The rules about VAT compliancy apply also for companies bases outside the EU. The guidelines are set in a European Directive. The big difference in B2B and B2C business is that companies selling to other companies are ‘zero VAT rated’. But when it comes cross border selling to consumer (B2C) the rules change spectecular. You have to consider the hight of the VAT treshold. You pay VAT in the country that you are based, but when exceeding the treshold you need apply for a local VAT number.
To avoid cross border VAT issues you should hire a fiscal representative in each European country. You get headace now? You should have because it is very complex to find companies that can give the service of fiscal representation. You are Lucky that you found this article, because we found our solution in RM Boulanger. This company has centralized al the expertise in the VAT compliance hub in the heart of Europe. So dealing with RM Boulanger means that they handle all the applications and do the administrative paperwork when you have to fill out the reporting forms.
You can decide to not pay VAT in each country but have to realize that you get penalized and your company can be blacklisted. This means when you do business in another EU Member State that your company will double checked because you have a spot on your imago. And when you deliver goods and services to the government you play with you license. So be smart and contact the people of RM Boulanger. You can continue doing business and they will handle al the husle. And when you expand to another country it is easy to do, because RM Boulanger knows your company and your business you are in. So that makes the Application easier en cheaper for you.