Newsletter Autumn 2014

More about MOSS

Do you know who and where your customers are? If you sell digital products such as software or music over the internet, and you are not VAT registered, you don’t have to worry about whether your customers are businesses, or where they are based. But that needs to change from 1 January 2015.

From that date, when you sell electronic services, broadcasting or telecoms to non-business customers in other EU countries, the sale will be treated as if it was made in the country where the customer is located. This means you will have to register for VAT in those countries, and apply the local rate of VAT to your sales.

The easiest way to complete your VAT obligations in other countries will be through the VAT-MOSS (“Mini One Stop Shop”) system on the HMRC website. This will be open for registration from October 2014.

However, to use MOSS you must first be VAT registered in the UK. This means you must pick one of these options:

If you sell your digital products to a distributor, that company will supply to the final consumer and it should sort out the overseas VAT. However, check what your contract with the distributor says, as some may act as your agent, just taking a commission on the sale.

Talk to us if you are unsure what to do.