VAT registered anyone?
RedRobo
Member, PRO Posts: 682
Hi,
I'm just getting ready to release my first paid app on Google play and have just got to the Tax section. It is so complicated and the more I look into it the worse it sounds. According to what I am reading I will have to to become VAT registered and submit quarterly tax returns as well as keeping all of my customers data for 10 years!
Is this correct can anyone offer advice? I must admit I haven't spent ages researching this yet but considering that I don't know if I will actually make any money yet it seems a huge overhead.
By the way I'm based in the UK.
Comments
If the customer makes payments to Google, and Google then pay you, it is Google who are responsible for tax. It should be subtracted from what they pay to you in advance of them paying it. This is the approach Apple are currently taking, too.
If the customer is from the EU and paying you directly, that's when you need to be submitting the quarterly tax returns.
Thanks @Armelline for the response.
It seems that Google are calculating,collecting and paying VAT to Euro countries (see attached.)
I'm just confused what happens for my sales in countries outside Europe? In the US for example? Google allows me to set my own VAT rate for these countries so is i the case that I would just set the VAT rate to zero?
Any advice much appreciated.
Just found this!!!
OMG I'm like a dizzy dog chasing it's tail!
Google say you are classed as a business if you aim to make a financial gain.
I've spent 6 months preparing an app to sell and I feel like I can't publish as I have no idea how to deal with these VAT procedures.
I called an accountant today who was no help. I think it's a very specialist area.
I suppose most indie developers ignore it and hope to stay under the radar?
My understanding is that unless you are selling direct to the customer you have nothing to worry about. Apple/Google/Amazon etc will collect and pay the VAT at the relevant rate to the different tax authorities.
This thread is about the same issue, worth reading through:
http://forums.gamesalad.com/discussion/76167/gamesalad-marketplace-new-eu-vat-laws/p1
@DigiChain Thanks for forwarding the thread full of excellent research by @Armelline .
Made me laugh about her comments of being on the phone to HMRC for hours....that's what I've been doing today...they did point me towards a nice flow chart though: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/390300/VAT_MOSS_Flow_chart.pdf
So I'm almost understanding it, I can see that because we are using a third party to sell that they deal with sorting out VAT to the various EU countries.
My final question that I have yet to find an answer to is what about sales made to countries outside the EU? Google does not mention anywhere on their site that they deal with the VAT in those cases.
@strag - This is a new EU law. Outside of the EU things remain the same as they were before.
When selling to countries outside the US, you only pay tax if you're above the sales threshold (I don't remember exactly, but it's ~£100k, a little less). So unless you make a ton of money from your games, you can ignore non-EU tax.
And not that it actually matters at all, but it's a he :P
@DigiChain @Armelline Thank you both for your advice, you've put my mind at rest
P.S. OMG sorry Armelline
good to know if i become the next millionaire