VAT Question, shipping goods from abroad
Hi,
I'm importing goods from the US, storing in a warehouse in Holland, selling online and delivering around Europe (haven't started yet!). The products will be sold through a website and the company is registered in Ireland.
Do I pay vat in holland and then send out goods with dutch vat rate included in the price or do I use Irish vat rates?
A bit complex I know!
Thanks,
Hello Doberden,
Interesting post, I am actually a dutch national, living in Ireland for the past 28 years, involved in the transport and logistics industry for over 30 years.
Herewith an outline to try and simplify the issues. The critical issue is the place of supply and if your market is business to consumer (B2C) or business to business (B2B). In case of B2C, if I interpret the VAT rules correctly, the place of supply would be The Netherlands as that is where the transportation of dispatch begins. You can opt to register for VAT voluntarily in the EU member state that you are selling into. However, if you exceed the threshold, you need to register for VAT in that member state. If you stay below the threshold of the respective EU member states (and do not register), you need to add Dutch VAT to your sales invoice and remit the VAT on sales to the Dutch VAT authorities. If you register for VAT in the respective EU member state, you add the VAT rate that applies in that member state.
If the client you sell to is registered for VAT in the EU member state you are selling to (B2B), you can supply him on the basis of 0 (zero) VAT. Your VAT registered client then has the obligation to account for the transaction in his VAT and INTRASTAT returns.
Here is an excerpt from the Irish VAT guide
Distance sales out of Ireland
In the case of distance sales made from Ireland the place of supply of such goods is the Member State where the transport or dispatch ends where the supplier has either exceeded the registration threshold in the other Member State or has opted to register in that Member State.Where a supplier has not opted to register for VAT in that Member State the place of supply is Ireland i.e. where the transportation or dispatch begins.
Example 5
A VAT-registered Irish trader supplies goods by means of mail-order to a private individual in the UK. If the seller’s level of trade to private individuals in the UK is below the Distance Sales threshold of £100,000 as applied in the UK and the trader has not elected to register for VAT in the UK, the place of supply is the State and, therefore, the trader has an obligation to account for Irish VAT on the goods.
Details of the thresholds applying to Distance Sales in the Member Sales of the EU is at Appendix J.
Appendix J Distance sales thresholds for EU Member States
Austria c 100,000 Belgium c 35,000
Bulgaria c 35,000 Cyprus c 35,000
Czech Republic c 35,000 Denmark c 35,000
Estonia c 35,000 Finland c 35,000
France c 100,000 Germany c 100,000
Greece c 35,000 Hungary c 35,000
Ireland c 35,000 Italy c 35,000
Latvia c 35,000 Lithuania c 35,000
Luxembourg c 100,000 Malta c 35,000
Netherlands c 100,000 Poland c 35,000
Portugal c 35,000 Romania c 35,000
Slovakia c 35,000 Slovenia c 35,000
Spain c 35,000 Sweden c 35,000
UK c 100,000
some further information on the subject of distance selling ;
5.11 Mail-order and distance selling
Distance selling in the Single Market occurs when a supplier in one EU Member State sells goods to a person in another EU Member State who is not registered for VAT and the supplier is responsible for the delivery of the goods. It includes mail-order sales and phone or telesales but does not include sales of new means of transport (see paragraphs 5.6 and 5.7 above) or excisable goods (see paragraph 5.12 below).
An Irish supplier who makes distance sales to customers in other EU Member States who are not registered for VAT, is liable to Irish VAT on such sales until the value of the sales reaches the threshold applying in that other EU Member State (see Appendix J).Once the value of the supplier’s sales exceeds the threshold in a calendar year in the other EU Member State, the supplier will be obliged to register in that EU Member State and account for VAT at the rates applicable there. If the appropriate threshold is not exceeded, the supplier may, nevertheless, opt to account for VAT in the EU Member State to which the distance sales are made. Please see VAT Information Leaflet ‘Distance Sales in the Single Market’.
Example 13
– Irish company making mail-order sales to Belgium of c20,000. Taxed where transport begins viz Ireland.
– Irish company making mail-order sales to Belgium of c40,000.Taxed where transport ends viz Belgium since the threshold in Belgium is c35,000 in a calendar year.
– Belgian company making mail-order sales to Ireland of c20,000. Taxed where transport begins viz Belgium.
– Belgian company making mail-order sales to Ireland of c40,000.Taxed where transport ends viz Ireland. Registration required since the threshold in Ireland is c35,000.
There are some significant implications in what you are trying to set up. I am happy to advise you on the best options on all aspects of your supply chain, including transportation from the US to the Netherlands, (bonded) warehousing, order pick, stock control and despatch, Fiscal representation (all VAT and regulatory formalities in the Netherlands).
Let me know if you need anything further
Best regards,
Rudolf289
So I (B) buy/order products from supplier A and A issues an invoice to me. Then I issue an invoice to customer C. All A B C are VAT registered. NOW: who charges VAT? 'A' charges VAT in his invoice to me B? 'B' charges VAT on the invoice to 'C'? And then can A B C claim VAT back? The goods are delivered directly to C - they don't cross Irish border if it matters. The 'B' company is registered in Ireland. 'A' and 'C' are registered in 2 different countries within EU.