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VAT facts

Entrepreneur, Oct, 2003 by Amanda C. Kooser

It's official: The Value Added Tax (VAT) required for purchases made in the European Union (EU) now extends to non-EU companies. The VAT, which ranges from 15 to 25 percent, depending on the product and country the customer resides in, represents a substantial amount. If you have online business customers overseas, you'll have to collect the VAT for digital sales. That includes software downloads, paid content, online auctions, e-books, Web hosting and other electronic services. Details on enforcement are sketchy, but there are potential monetary fines for late VAT payments or nonregistration.

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Fortunately, entrepreneurs don't have to register with each EU member state--only one is required. The UK Customs site simplifies the process by allowing you to sign up online at https:// secure.hmce.gov.uk/ecom/ voes if you choose the UK. Visit the EU's VAT site at www. eurunion.org/legislat/ vatweb.htm for more on who is required to register and what items are covered by the new law.

Business Services Industry

VAT facts

Entrepreneur, Oct, 2003 by Amanda C. Kooser

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