Oh Europe, you and your lovely bureaucratic hurdles

Discussion in 'Ecommerce Forum' started by Federico Parravicini, Feb 22, 2018.

  1. RSR Fulfillment (FR & DE)

    RSR Fulfillment (FR & DE) UKBF Regular Free Member

    138 13
    The main issue for me is language with VAT. All of a sudden you have to deal with each country individually once you hit their rather low thresholds.
     
    Posted: Feb 26, 2018 By: RSR Fulfillment (FR & DE) Member since: Dec 8, 2017
    #21
  2. Federico Parravicini

    Federico Parravicini UKBF Newcomer Free Member

    11 1
    I sent you a message with some more specific questions, I hope you don't mind!

    Yeah, I agree, but when an entrepreneur is starting and hasn't got the funds to pay a Steuerberated 70 euro an hour, you have to do all this bureaucratic buzz yourself

    Man, that does sound problematic, I suppose that's why people try to focus on the countries with the highest VAT thresholds
     
    Posted: Feb 26, 2018 By: Federico Parravicini Member since: Feb 22, 2018
    #22
  3. The Byre

    The Byre UKBF Ace Free Member

    7,319 2,838
    I run a German company and I do not recognise any of that description by @RSR Fulfillment (FR & DE) . MwSt is done in-house and the accountants just are there for end-of-year stuff and are cheaper than in the UK.

    Taxes are considerably higher, esp. payroll taxes (the ones the employee does not see and fails to realise he/she is paying!) and the bureaucracy is absolute. It works, but there are no grey areas! Just don't ask them to be flexible or speedy.

    But one thing I must point out - if you don't speak fluent German and have a comprehensive understanding of German commercial laws, rules and regulations, the system is merciless and will chew you up for breakfast!

    (One of the more fun aspects of doing business in Germany, is that the laws and state mandated holidays are different in the 17 different states - that gets the novice foreign businessman on the back-foot every time!)
     
    Posted: Feb 26, 2018 By: The Byre Member since: Aug 13, 2013
    #23
  4. RSR Fulfillment (FR & DE)

    RSR Fulfillment (FR & DE) UKBF Regular Free Member

    138 13
    I think I would not worry about VAT thresholds...language and market size are the 2 things for me that would steer my business.

    I don't speak German but the market is the biggest of UK, Germany and France. I speak French but it is the smallest of the 3.Bummer!
     
    Posted: Feb 26, 2018 By: RSR Fulfillment (FR & DE) Member since: Dec 8, 2017
    #24
  5. RSR Fulfillment (FR & DE)

    RSR Fulfillment (FR & DE) UKBF Regular Free Member

    138 13
    Well that's me. the novice foreign businessman for sure! If only I could employ someone inhouse. But that is a long way off. We have 1 director and employee in UK and just me manning Germany and France.
     
    Posted: Feb 26, 2018 By: RSR Fulfillment (FR & DE) Member since: Dec 8, 2017
    #25
  6. RSR Fulfillment (FR & DE)

    RSR Fulfillment (FR & DE) UKBF Regular Free Member

    138 13
    But i disagree on the cost of accountants. I pay a UK chartered one to prepare my VAT returns. She charges me less than 200 quid. The Germans check it and submit it and charge me more than triple.

    If you are small with low turnover like me (about £15k sales per month), the massive difference is that you have to submit VAT returns every month and in UK it is every 3 months.

    This, and the higher fees, nearly bankrupted me as soon as I rocked up with the stuff last year.

    I resent this. Germany is not helpful to startups at all. France is actually better, they have a micro-entrepeneurship scheme where you just pay 14% on your sales up to 80,000 euros. So you don't need to pay accountants at all, inhouse or outsourced.
     
    Posted: Feb 26, 2018 By: RSR Fulfillment (FR & DE) Member since: Dec 8, 2017
    #26
  7. The Byre

    The Byre UKBF Ace Free Member

    7,319 2,838
    It is every month for the first two years only. After that it depends on your usual MwSt amount to be paid. If you only usually pay €1000 or less then it is once a year, if you pay between 1k and 7500, then it is every quarter and after that it is once a month.

    As for who does the MwSt and VAT - it is such an easy task (takes just a few minutes) both here and in Germany and is done on-line and is designed to be completed by a non-accountant, that there should be no reason for anybody to have to farm-out this process!

    I really can'r remember what we pay our German accountants, but it is about half of the UK cost. The trick is to have everything in standard form, ready and clear and all they have to do, is present it to the Finanzamt. If you are a small company, you (and not the accountant) have to be the bookkeeper!

    Here is a good, on-line primer in all things MwSt -
    http://www.expert-line.de/die-umsatzsteuer-fuer-selbstaendige-2-wie-oft-und-wann/
     
    Posted: Feb 26, 2018 By: The Byre Member since: Aug 13, 2013
    #27
  8. RSR Fulfillment (FR & DE)

    RSR Fulfillment (FR & DE) UKBF Regular Free Member

    138 13
    So....why do they make it easier for established companies and harder for start-ups? There is no good reason to make an under-resourced company do 12 VAT returns per year and an established one only 4 returns. It should be the other way round or equal.

    I am not great with accounts and forms. I used to make mistakes on all my UK self-assessment stuff. Every year i got it wrong until I paid an accountant to do it all. So in Germany the buck got passed to the accountants.

    I suspect there's a lot of cliquey mason types out here, trying to maintain the status quo! It's tough as a tiny player. They talk about being a family-business type country. But do not think that means what you think it means in UK, small outfit working from home. It means big company with plenty of nepotism.
     
    Last edited: Feb 26, 2018
    Posted: Feb 26, 2018 By: RSR Fulfillment (FR & DE) Member since: Dec 8, 2017
    #28
  9. Federico Parravicini

    Federico Parravicini UKBF Newcomer Free Member

    11 1
    Well, I do speak German and I'm improving enough to have conversations with officials about economic topics and so on, but it seems to me you're telling me that because I didn't get a bachelor in Business management from and German university and because I don't have a lawyer or two, I should stay put and don't start a company.

    Please, correct me if I misunderstood you.

    I think I can do with Germany and the English speaking countries at the beginning, besides, an English website also serves internationals and expats in those countries! Well, I like to believe so anyway :)

    Are you talking about the ELSTER software/thing? I heard it's quite useful once you're already into doing business! And honestly, I'm not going to hire anyone but a VA for the months and even year there is to follow.

    I do sense a bit of nepotism, I have to say... But I hope Germany corrects me and shows me otherwise!
     
    Posted: Feb 26, 2018 By: Federico Parravicini Member since: Feb 22, 2018
    #29
  10. The Byre

    The Byre UKBF Ace Free Member

    7,319 2,838
    You must also be capable of leaping tall buildings with a single bound!

    But most successful businesses seem to be started by either a Meister (master tradesman) or an engineer and these people get backing from their 'Innung' (trade association) and have to do courses on how to run a business, do the books, manage taxes and basic commercial and consumer law. The government and/or the Innung will give low-interest loans and grants to those with a suitable technical education.

    The UK has a very 'Have-a-go!' attitude, which is possibly why so many businesses fail here. Banks in Germany like to see people with a basic education in business. I started my first business in Germany in 1979 and both my wife and I had an education as 'Industriekaufmann' and I went on to study economics and my wife studied business economics (Betriebswirtschaft - known to its friends as BWL).

    Germans like to have everything in writing. The British/French/Italian idea of doing business on a handshake is very foreign to them! Everything has to be black and white and written down.

    I have seen German one-man companies actually writing down their standard procedures and QC protocols and on one occasion, even spend several days, working out and documenting company policy and ethics!
     
    Posted: Feb 26, 2018 By: The Byre Member since: Aug 13, 2013
    #30
  11. Federico Parravicini

    Federico Parravicini UKBF Newcomer Free Member

    11 1
    Haha, I don't get it :)

    It's great that those people were able to get financing early on and such, but I'm not really going to ask anyone for money and again, while one does need to be knowledgeable, I don't think it's impossible for a normal, hardworking person to start a successful business, especially a non-traditional, online one! But of course, that comes down to each's opinion.

    Pity! I like that have a go attitude, but I'm sure they're still human beings doing business at the end of the day :)

    Understandably so, policy and ethics are important!
     
    Posted: Feb 26, 2018 By: Federico Parravicini Member since: Feb 22, 2018
    #31
  12. Andrew_P

    Andrew_P UKBF Contributor Free Member

    34 1
    If you aren't registered as VAT payer (not VAT ID), then you don't have to add tax (VAT) to your invoice. There will be that single price and that's it. However keep in mind that when you want to buy some products or services from another EU country, you will have to pay (to your supplier) the price and also the VAT. And then you will most likely have to pay VAT in your country again. And then you'll have to deduct VAT you paid to your supplier to compensate that. Well, its a mess...imho better just register for VAT...
     
    Posted: Mar 2, 2018 By: Andrew_P Member since: Mar 2, 2018
    #32
  13. Federico Parravicini

    Federico Parravicini UKBF Newcomer Free Member

    11 1
    You know mate, I think I will, just not now because honestly, I think too much time has been spent trying to solve this stuff and the business needs to go on the air, but as soon as we reach decent profits, VAT it is!
     
    Posted: Mar 2, 2018 By: Federico Parravicini Member since: Feb 22, 2018
    #33