Background Information

Digitally Delivered Items

These are subject to the modified Place of Supply Rules introduced on 1st January 2015.

If you add one ‘Digitally Delivered Product One’ to your Basket you can see the appropriate amount of VAT displayed. We’ve carefully priced the Product at £100 exclusive of VAT so that the VAT rate is easy to see. (You may, of course, select more than one product in any quantity, the vatmate® API will deliver the correct VAT amount and this will be displayed in the Basket and Checkout panes.)

Once online sales have been made there is a requirement to deliver a VAT return and remit all the VAT collected, within a specified time, to all countries where sales have been made in a given VAT quarter.  It is important to note that the ‘VAT quarters’ for these payments are independent of ‘normal’ VAT Returns and may NOT coincide:

  • Q1   01 January to 31 March
  • Q2   01 April to 30 June
  • Q3   01 July to 30 September
  • Q4   01 October to 31 December

Non-Digitally Delivered Items

These are not currently subject to the same Place of Supply Rules as digitally delivered items.

VAT is required to be charged to purchasers, both consumers and businesses, if they are based in the same country as the seller with the rate of VAT set by that country.  If the purchaser is a business that is not based in the same country as the seller then the VAT rate levied depends upon the geographic location of that business. If the business is located in a Member State of the EU then the supply will be zero rated providing that a valid VAT Registration Number is provided at the point of sale. If no valid number is entered then the VAT is levied at the rate applying in the seller’s country. If the business is located outside of the EU the supply is outside the scope of VAT and the rate returned by the API is therefore always zero. Note: certain countries have their own tax tariffs and it up to the seller to satisfy themselves that they are taking this into account should they trade with such countries.

If you would like to learn more then please contact us.