Author Topic: Physical Goods & VAT  (Read 2785 times)

Ilona

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Physical Goods & VAT
« on: April 16, 2015, 06:19:36 PM »
I have just been pondering on the VAT thing on Tutorials ect. This hasn't been thrown out by the EU yet, and they said that if it was a success, then in  the new year they would bring in VAT on Physical goods too. What I was wondering is, do you think etsy will sort out the VAT thing? I don't know what I will do if not. I would think I will close down. I would love to hear your thoughts on this VAT mess.

Jolene

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Re: Physical Goods & VAT
« Reply #1 on: April 16, 2015, 07:45:17 PM »
Well there is discussion going on at the highest levels in the EU about how badly this is affecting small business. It really hadn't been anticipated - to roll this out soon for physical goods without a threshold for small business, after now fully understanding the impact with digital would be willful stupidity on behalf of the EU. Gawd know what Etsy will do, suspect they don't even know that themselves.


jille

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Re: Physical Goods & VAT
« Reply #2 on: April 16, 2015, 08:17:36 PM »
I have been pondering what I will do too. Etsy or at least Folksy should do something because they would gain loads of business, because you won't want to sell through your own website

nemeton

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Re: Physical Goods & VAT
« Reply #3 on: April 16, 2015, 11:49:59 PM »
Etsy said in Feb they would be 'handling' the VAT on downloads and that we'd be updated on the details in 'mid March'. Hmm.  :-\ Haven't been able to get a response out of them since as to exactly how they would be billing it (would they be charging our customers extra, or would we be expected to hike our prices to accommodate it in some way?) so despite it being a massive PITA I am still selling all patterns via email not instant download until Etsy sort it out. Which at this rate doesn't look like happening any time soon  >:( and anyway I think I am the only Etsy user who is at all concerned. This doesn't make me hopeful that Etsy will do anything if the worst comes to the worst and this new rule rolls out to physical goods too...
I really hope that the recent discussions by Ansip and others reflect a real change in the understanding by the top level of EU administrators as to how online businesses now operate and how out-of-date and ill-informed the new VAT legislation on digital products has been. Even though I think they are serious about introducing the new system for physical goods too, I am hopeful that by the time this happens there will be agreed exemptions and limits that will enable the smallest of small businesses to continue to operate. I have to believe that, otherwise I'll just throw in the towel  :(

Ilona

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Re: Physical Goods & VAT
« Reply #4 on: April 17, 2015, 07:38:09 PM »
I think we will just have to wait and see. I just hope they don't leave it to the last minute.

GaysieMay

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Re: Physical Goods & VAT
« Reply #5 on: April 18, 2015, 08:19:53 AM »
I was in the midst of writing a tut to sell when I heard about this law - shelved it.  If they bring it out for physical goods, that would be me done.

Vickie

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Re: Physical Goods & VAT
« Reply #6 on: May 01, 2015, 11:03:57 AM »
I am waiting to find out about this too.

If they do allow the VAT on the shippable products there is a few things I need to alter on Truly Handcrafted and I may as well allow downloads again.


Pain in the backside it is.

Purple Cobwebs

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Re: Physical Goods & VAT
« Reply #7 on: May 01, 2015, 11:38:58 AM »
I'll be amazed if they reduce the vat registration limit from 82,000 to nil in the very near future. However it may well come in eventually to bring us in line with Europe.

However if they do, there are pros and cons.

1) Prices will rise, however the playing field will be level as no matter how big or small your business you will have to charge VAT. I have clients who are in the crazy situation where by closing their shops for an extra week a year they stay below the vat threshold and end up with more money in their pockets!

2) It will help weed out those who sell but don't register for tax. As everyone selling will have to register for VAT and show VAT numbers on invoices, HMRC will easily be able to ensure they register for self assessment as well.

3) If you go on the flat rate scheme, you charge VAT at 20%, but pay it over at a lower rate, and so make a small vat "profit".

So although an administrative pain, it might not all be doom and gloom  ???

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Pandanimal

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Re: Physical Goods & VAT
« Reply #8 on: May 01, 2015, 01:56:34 PM »
Can we not simply to refuse to sell to the EU? And state that on our sites/facebook listings?

Shirley

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Re: Physical Goods & VAT
« Reply #9 on: May 01, 2015, 04:58:59 PM »
I believe you have the right to choose who you do and don't sell to