Dealing with VAT is an administrative burden for many e-commerce sellers because of the many different rates, rules, and regulations for each member state. Even with the simplification that came this July, there are certain aspects of e-commerce VAT that warrant the help of a local tax accountant.
Hiring local business tax accountants are necessary to avoid confusion and waste of time when sellers deal with VAT-related issues, more so if they’re non-EU businesses.
A huge change in the way e-commerce merchants are doing business came in 2020 when the COVID-19 pandemic hit. Online sales skyrocketed and many were left to deal with VAT on their own as thresholds were breached, and consequently, authorities battled with increasing VAT fraud and non-compliance.
And then Brexit happened which meant more changes and more adjustments for these sellers. It doesn’t end there. While the new EU VAT rules have also been pending for some time, these are additional modifications for the already bombarded e-commerce merchant.
Aside from the introduction of the OSS or One-Stop-Shop system in the EU, there have been changes in the rules regarding the need to appoint a fiscal representative post-Brexit. It can be recalled that most EU member states require non-EU businesses to appoint a local fiscal representative. Some territories have even announced the deactivation of VAT numbers for non-EU businesses that fail to appoint one.
In short, there has been so much confusion with the shift in the e-commerce landscape and rules, some of which have not been clarified yet by local tax authorities.
Instead of relying on speculative online information and discussions, you’ll always get surer results by hiring a professional local tax accountant instead. Having a local CPA by your side ensures VAT compliance in every EU country, thus, hassle-free e-commerce for you.
What is a Fiscal Representative?
A fiscal representative is an entity with a local address acting as a VAT representative of a non-EU-based foreign seller.
Representation is necessary when the foreign seller exports goods into that country, making him liable to collect VAT from his customer. That will require VAT registration and hence, compliance.
The entity itself must be locally tax-registered and will be liable for any VAT payments and penalties due of the business it represents. This is known as joint and several liability. Hiring a fiscal representative, therefore, is a delicate matter as this entity must understand its responsibilities
And since the UK is no longer part of the EU, a UK-based seller will have to appoint a tax (or fiscal) representative for EU territories that require them.
These countries that require non-EU businesses to appoint a local representative are:
- Austria
- Belgium*
- Bulgaria
- Croatia*
- Cyprus*
- Denmark* (with exceptions)
- Estonia
- Finland
- France*
- Greece
- Hungary
- Italy*
- Lithuania*
- Poland
- Portugal
- Romania
- Slovenia
- Spain
- Sweden
*except for UK-based businesses
What Can a Local Tax Accountant Do For My Business?
Joint and several liability is a heavy obligation especially for the representative, so much so that there are not a lot of companies in some EU territories willing to carry that burden. In these places, the issue is still being discussed further to see what the authorities can do to mitigate this after 1 July.
For those who fully understand the responsibility and take up the challenge, much can be accomplished.
Among these are VAT registration, returns filing, and other VAT compliance needs. When tax authorities need a response from the business, they will contact the representative.
Your local business tax accountants will stay on top of new information on all EU member states as it comes in, making sure you are on the right track with your VAT obligations.
VAT penalties are becoming stricter and thus accurate records keeping and calculations done by your trusty accountant will keep those tax authorities off of your back.
Where Can I Find Local Tax Accountant I Can Trust?
Don’t just hire anyone. Trust Munshian Ltd.
At Munshian, we don’t see joint liability as a burden but an opportunity: our local tax preparers become the vehicle with which your business becomes successful in the EU.
Munshian Ltd offers detail-oriented service through expertise in local tax regulations, ensuring that your business’ tax-related needs are properly and promptly attended to. Munshian has local tax experts in at least 8 different EU countries:
- The United Kingdom
- France
- Czech Republic
- Poland
- Italy
- Spain
- Germany
- Austria
By partnering with us, you gain a competitive edge through:
- Cost-effective solutions
Choose the best package that meets your company’s needs.
- Legal and accurate tax affairs
We guarantee nothing but legal and accurate taxes and records. Our team takes extensive measures to deliver only the best VAT services for your business.
- Use of appropriate software programs
Being detail-oriented professionals, we double-check all calculations using dependable software programs. Through this, human-made errors are eliminated and you have ensured accounting accuracy.
No More Worrying About VAT with Munshian
Munshian is your single point of contact for the whole of the EU and the UK no matter where you are in the world. As an Amazon seller, you need to be properly VAT registered, compliant, and informed of the latest tax rules that concern you. Munshian does that and more.
Munshian has local tax accountant with years of experience and can speak your language. If you need someone who will talk to you about your tax concerns regarding any country in the EU, you can rely on the knowledge and expertise Munshian provides.
Rule the EU e-commerce market with Munshian . We are here for you all the way.
