VAT on digital downloads

[newme]

Hello,

I run a UK based, VAT registered agency.

We're planning to sell off-the-shelf reports online: people pay for the report online with a credit card and download the file automatically after payment.
People from anywhere in the world will be able to buy from us.

How should we display our prices? Should we include VAT or should we show the price before VAT and add VAT at the checkout?

Should we charge VAT to Uk based buyers only or to everybody who buys a report, even overseas buyers?

What do you do with VAT on the products and services you sell online?

Em

 

[dx3webs]

Hi there,

I hate to say this but you really need to talk this over with your accountant.

General rule of thumb.. B2B ex VAT B2C inc VAT

B2B within EU is 0 rated provided they can provide you with a valid VAT number

 

[optik]

dx3webs is spot on

 

[SuffolkDesigns]

According to the EU VAT should be charged based on the place of purchase not the place of sale for digital downloads. You will see some US based companies charging VAT on digital products for their EU clients. They are meant to pass the VAT back, but whether they do or not, and how the EU can force the USA to charge VAT to EU clients is anyone's guess.

http://www.out-law.com/page-3480

 

[newme]

Thanks Suffolk designs. The link you provided answers my question perfectly.