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Governments throughout Europe are trying to find ways to ease cash flow concerns for businesses to alleviate some of the pressure caused by the current pandemic.
Value Added Tax (VAT) is applied in different - and sometimes complex - ways by different tax authorities. Across Europe, a variety of approaches are being taken to payment deferrals and qualifying criteria in response to the coronavirus.
If you think your company may be impacted by either of the announcements below, please contact us to discuss your specific circumstances. You can also read about other measures designed to help companies with UK operations.
With effect from 1 May 2020, electronic books and digital publications (such as online newspapers, magazines, books, academic papers and journals) will be zero-rated for UK VAT purposes, instead of subject to the standard rate of 20%. The VAT rate reduction was originally announced in March 2020 and was scheduled for 1 December 2020 but has been brought forward in response to the increased number of publications which are now only distributed digitally. This change applies to all transactions where the customer is located in the UK, regardless of the supplier's location.
The EU VAT eCommerce package which was due to launch on 1 January 2021 has been pushed back to 1 July 2021 due to the pandemic. The eCommerce package includes:
Sellers who are non-resident in the EU can use the OSS simplified filing; however, they must first register as a 'non-Union' taxpayer with the tax authority of an EU Member State.
For more information on VAT across Europe, contact Jamie Richardson or Sean O'Sullivan below:
Tel: +44 (0)20 7430 5889
Senior Tax Manager
Tel: +44 (0)20 7430 5966