Improve Tax feature in Membership Pro 1.6.8

That's not true in Spain... Here the rules are as follows:

To all EU Countries:
- VAT/ IVA 21% --> Al people Private or Company must be charged of this tax.
- Only a company with a valid 'VAT Number' can avoid to be charged by setting it during subscription process.

- Other countries ( no EU ones) don't have to be charged the 21% of EU VAT/ IVA.

Recommended test at your end:

1) As prove of that go to Akeeba site (they're European): www.akeebabackup.com/subscribe/levels.html start a subscription process selecting an European country and their EU tax (Cyprus) of 19% will be charged (no matter if you are a company or a private). As said before only if you have a valid EU VAT Number you could avoid to be charged.
2) Change later to other non EU country VAT will not be charged.

Hope this helps,
Rgrds,

Thanks Gabriel. So I think the current implementation in Membership Pro works good for you ?

I read from somewhere that if you are from your own country, even if you have a valid VAT number, you will still be charged tax. Is that correct ? Right now, Membership Pro works in a way that if you provide a valid EU VAT Number, you won't be charged tax. Not sure it is correct ?

Tuan

answered through Skype.
Thnaks4All

Hi all
It seems like we need some clarification here.
@Gabriel correct me if you think I´m wrong, I´m in no way any expert in this.

The new tax rules will be applied per 1.1.2015
If you sell electronic services, telecommunication services and transmission services to individuals in other EU countries, they are taxed in the country where the purchaser resides. You as the seller is responsible to pay VAT.

Meaning that VAT is to be applied for that specific country (Spain 21%, Sweden 25%, Italy 19%, Greece 19%) and I as a seller is to pay the VAT to the corresponding country (here in Sweden we pay to our tax authority and then they will pay to the correct EU country)

Text below is taken from our taxauthority here in Sweden

Selling goods to VAT registered buyers in other EU countries
1) With EU countries we mean countries within the EU VAT area. The general rule is that you should add VAT on sales when you sell an item that is located in Sweden and transported to a purchaser in another EU country.

2) You may, however, sell without VAT to a purchaser in another EU country if the purchaser is registered for VAT in another EU country and invoking the VAT number (VAT number). The buyer must then account for VAT in the other country.

Selling goods to non-VAT registered buyers in another EU country
When selling goods to private individuals or other non-VAT registered buyers in other EU countries, when the goods transported there from Sweden, the starting point is that you should add on VAT. However, there are specific rules on such sales.

General rule for sales to traders
The main rule when selling services to traders is that services are regarded as supplied in the country where the customer is established, if the service is sold there.
You should not charge any VAT if the buyer is a trader in another country than Sweden.
Established considered to be where one has his place of business or a fixed establishment.
If the buyer has no place of business or fixed establishment is considered the service supplied where the purchaser resides or habitual abode.

To be able to sell without VAT under the general rule, you must be able to verify that the buyer is a trader established abroad.
For sales to VAT registered purchasers within the EU, it is normally sufficient to have buyer's VAT number.
You can verify the purchaser's VAT number is valid.

Have you checked your customer's VAT number?
It is important that you check your customer's VAT number. You may be required to pay Swedish VAT if you have sold a product without Swedish VAT and it later turns out that the buyer did not have a valid VAT number on delivery.

Check the buyer's VAT registration (VAT number)
You can check the buyer's VAT number in the following way.
Check the format. The buyer's VAT number must contain the correct number of characters, etc. as applicable for each country. (se file)

Selling gods within your EU country (Sweden)
What is VAT?
VAT is a tax on goods and services that must be paid to the state.
VAT is often included into the price and nothing you need to consider as a private person.
As an entrepreneur (trader, company), however, you must report and pay VAT on the goods and services that you are dealing with.

Pay VAT
If you run a business where you trade with goods or services in Sweden, you are obliged to charge VAT from your customers and remit sales tax to the state.
VAT is therefore no cost to you, it is a tax that you take out of the customer and further to the state.

Conclusion
1) Selling gods within the EU (except your own country), VAT is to be charged to private coustomer but my not be seen in the invoice, all is included in the price. I as a trader pays the VAT to the corresponding EU country.
2) Selling gods to a trader within the EU (except your own country), VAT is not to be charged or included.
3) Selling gods within your own country (Sweden) The same as #1 above, The VAT is included and should not be seen in invoice I as trader will take care of paying the VAT to the state.
4) Selling gods to another swedish trader VAT is not to be included in price. VAT is to be charged separatly on the invoice.

Selling gods to a private coustomer in EU NO VAT is to be seen, the trade will take care of this.
Selling gods to a trader in EU OUTSIDE of your own country NO VAT is to be included, therefore the VAT number must be verified agains the countries (se attached file), selling gods in EU WITHIN your own country VAT IS TO BE CHARGED separatly on invoice.

Example:
Selling to a trader in Spain.

NET PRICE: 100
TAX (VAT): 0
GROSS PRICE: 100

Selling to a trader in Sweden

NET PRICE: 100
TAX (VAT): 25
GROSS PRICE: 125

Selling to buyer in Spain (private person)
Price 100 VAT (in spain 21%)

GROSS PRICE: 121 (VAT included)

Selling to buyer in Sweden (private person)
Price 100 VAT (in sweden 25%)

GROSS PRICE: 125 (VAT included)