EU VAT threshold for B2C digital services for micro businesses

Since 2019 EU introduced a new €10,000 threshold for total supplies of digital services to consumers in the EU in a calendar year. As a result, businesses will be subject only to the VAT rules of their home country if their relevant sales across the EU in a year (and the preceding year) fall below this threshold.

 

Russia introduced VAT for B2B digital sales

New tax rules effective from January 1, 2019. Foreign companies providing electronically supplied services to Russian companies or individual entrepreneurs will be liable for the calculating and payment of Russian VAT. The earlier VAT was due only for digital  B2C sales.

standard VAT rate increased from 18% to 20%

Threshold:

There is no VAT registration threshold. Foreign suppliers, therefore, will need to register if they make even single e-supply irrespective of the volume of such sale.

 

New rules for marketplaces

Online marketplaces liable for the missing VAT in Germany and the UK.  Distance sellers may need to adapt their business processes in order to ensure their compliance. In any case, distance sellers should apply for a confirmation of registration as soon as possible. It is unclear whether marketplaces will require an original confirmation from their sellers. Therefore, if possible, distance sellers should request a separate confirmation for each marketplace they use. This rule will be accepted by all EU countries by 2021 online marketplaces will become responsible for ensuring that VAT is collected on sales of goods by non-EU companies to EU consumers taking place on their platforms.

 

Switzerland distance sales threshold

Effective from 1 January 2019, the registration threshold for distance sales will be 100 000 CHF (annually). In this sense, if the 2018 annual turnover exceeds or the expected annual turnover in 2019 will exceed this threshold, the company has a tax liability as from 1 January 2019.