EU based translators invoicing customers who are outside the EU,re. VAT
Thread poster: DGK T-I

DGK T-I  Identity Verified
United Kingdom
Local time: 08:10
Member (2003)
Georgian to English
+ ...
Jul 3, 2003

Much has been said about new agreements between the EU and US, that mean that EU based entities (who do not have VAT numbers) will now have to send fees including VAT to US based entities that they buy things (including Proz. membership) from.

Do these agreements affect translators based in the EU (if they have to collect VAT under their countries regulations) when they are invoicing the US. Or vice versa ?
Or are they still regarded as exporting their services outside the EU, etc, and therefore not subject to VAT ?

I'd be grateful for advice - I appreciate the answer must seem obvious to people who know.
Best wishes
Giuli






[Edited at 2003-07-04 14:30]


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Williamson  Identity Verified
United Kingdom
Local time: 08:10
Flemish to English
+ ...
The US does not have VAT Jul 4, 2003

In the US, there is no such thing as VAT, but sales-tax which has by far not attained the E.U.-level.

An interesting article about this is : http://www.theinquirer.net/?article=10218

Besides if you are in the UK, the VAT-treshold is £ 60,000 (Gordon Brown recently raised it), so you do not need a VAT-number if you earn less than that amount.

Within the E.U.
VAT works as follows (in those countries with a lower treshold) :
The service-provider (translator) and the client live in the same country.
VAT is calculated and cashed.
If the client is a private person he pays VAT.
If the client is a legal entity VAT for the service is deduced from the VAT he owes to the VAT-office at the end of the quarter.
At the end of each quarter the translator also has to calculate the total amount of VAT he has received from his clients, deduce the VAT, he has paid for business-related purchases and pays the difference to the VAT-tax office.
If the client lives outside the State of the translator, but inside the E.U., no VAT is to be calculated. Only his VAT-number has to be mentioned on the invoice (if he has one).
To elsewhere in the world outside the EU, it is and remains pure export of an intangible service on which no taxes are to be levied.


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DGK T-I  Identity Verified
United Kingdom
Local time: 08:10
Member (2003)
Georgian to English
+ ...
TOPIC STARTER
Thank you very much for the very full & kind explaination Jul 4, 2003

Thank you very much for the very clear explaination and the interesting article - which did a lot to reassure me about what has and hasn't changed. As you say, I'm not registered for VAT collection under UK rules (although some proz members such as Mary have advocated voluntary registration).

I guess it's a bit loose of me to call sales taxes VAT !

Gratefully
Giuli


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EU based translators invoicing customers who are outside the EU,re. VAT

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