managing VAT on ecommerce

Rdz

Free Member
Dec 24, 2009
2
0
Hi There.
I am building a website, and I am stuck with the question on how to manage VAT. We are based in the UK, and will be selling to europe. Therefore we decided to add a function in our ecommerce website for european customers to input their vat number, this will be validated automatically, resulting in VAT free export from the UK.

My questions is:
1. Is it possible for my website to validate the VAT numbers automatically, and if it is valid the customer will then be able to continue without VAT being applied?
2. How can I prevent a user from using a VALID VAT number belonging to another company? Therefore making a VAT free purchase which they are not entitled to. From my understanding, VAT numbers can be verified but not to a specifc company.
3.If point 2 occurs, would we be liable for VAT on the item?

Thanks
 

Top Hat

Free Member
Mar 3, 2005
2,183
172
Airstrip One
I think you might be getting bogged down in detail.

My advice is make your system work as you are proposing, when you get an order using a European VAT number, don't ship until you have checked it, company web site etc.

When/if this extra work becomes a burden that's the time to look at developing a better system and automating it, you may find you get very few of those orders.

It might also be worth while speaking to the VAT man, the advice can sometimes be good.
 
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Rdz

Free Member
Dec 24, 2009
2
0
Thanks for the advise. Initially i taught this vat system must be good and not easily to be abused. Looking at so many big e commerce companies if they have to individually check the vat number, it will take a lot of time and effort. I guess i will have to do it manually for now since we are just a start up.
Can anyone share a light on how to do it automatically?
thanks.
 
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