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EU taxes for digital products


Jan Fromm
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Hi @kongondo,

I would be interested to know to what degree Padloper handles EU taxes for digital products, and what may need to be added by the developer. As I’m sure you know, this varies greatly depending on whether the seller is based in the EU or not, whether the customer is based in the EU or not, and whether it's private (without VAT number) or business (with VAT number).

There is this option »Charge EU Digital Goods VAT Taxes« in the tax settings. As far as I can see, this has no effect yet. Or did I miss something?

Is this still WIP? Or what are your plans?

Thanks!

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Hi @Jan Fromm,

5 hours ago, Jan Fromm said:

There is this option »Charge EU Digital Goods VAT Taxes« in the tax settings. As far as I can see, this has no effect yet.

It does have an effect, unless I recently broke something 😄. I've just tested the below and it works fine.

5 hours ago, Jan Fromm said:

to what degree Padloper handles EU taxes for digital products, and what may need to be added by the developer.

Currently this is limited to the following:

  1. A product has been designated as NOT taxable.
  2. The product is specified as a digital product.
  3. The Charge EU Digital Goods VAT Taxes is ticked.
  4. The customer country is IN the EU (proceed to #6).
  5. The customer country is NOT in the EU (proceed to #7).
  6. (EU Digital Goods) Tax will be charged on this product. (unless it is a manual order and the order or the customer has been exempted from tax).
  7. Taxes will not be charged on this product (unless it was specified as taxable in #1).
5 hours ago, Jan Fromm said:

As I’m sure you know, this varies greatly depending on whether the seller is based in the EU or not, whether the customer is based in the EU or not, and whether it's private (without VAT number) or business (with VAT number).

These complexities (at least currently) would have to be handled by the developer. I'm not sure that we currently have somewhere to hook into. I'll have a look.

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2 hours ago, kongondo said:
  1. A product has been designated as NOT taxable.

That was the trick. Thanks!

Assuming that only digital products are to be sold, would it be enough to only care about the tax rates of EU countries? The other countries could be created without tax rates, right?

2 hours ago, kongondo said:

These complexities (at least currently) would have to be handled by the developer. I'm not sure that we currently have somewhere to hook into. I'll have a look.

Fantastic. Thanks again.

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19 minutes ago, Jan Fromm said:

Assuming that only digital products are to be sold, would it be enough to only care about the tax rates of EU countries? The other countries could be created without tax rates, right?

Theoretically, yes. However, you would need to be aware of any laws similar to the EU Digital Goods regulations.

Not closely related, but I forgot to mention (and you are probably aware of this) that we also have tax overrides that can be applied per category of products or shipping.

22 minutes ago, Jan Fromm said:

That was the trick. Thanks!

Glad you got it sorted.

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