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RE: profit on line, taxes, internationally...how?
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Jeffrey Baumgartner
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Mar 07, 2005 08:02 PST
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Come on, legal specialists out there, let's see your
comments!
In the meantime...
On 6 Mar 2005 at 17:46, al wrote:
| | | | Your business is subject to all local and national taxes
in the location where your business is established. The
location of the server hosting your e-commerce web site is
irrelevant.
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But I don't understand one thing: the website would be in
English, it would sell worldwide, basically there would be
nothing to do with Italy besides the fact that I am Italian.
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No, the only thing your business would have to do with
Italy is the fact that it is registered there. If you
wanted to, you could register your business in another
country - particularly a EU country - and run it out of
Italy. Then you would be subject to the taxes of the
country where your company is registered. Of course it is
not as simple as that, get professional advice before doing
something like that.
| | | | I do not know where you are located, but let us say you
have a business registered in Rome but sell services
globally via a web sit hosted in London. Your business
would be subject tall Italian taxes as well as any
property or other taxes applicable to businesses in Rome.
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So, let's say that I am selling a membership to be part of
my website, and I ask 1$, how would I count the VAT and
local taxes? What if I just put the CCBill transaction on
the site and I would just get the transactions in my bank
account? Cause I saw many website and I have never noticed
any VAT or taxes
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Normally, for B2C sales, VAT is incorporated into the
'sticker price' For example, when you visit your
supermarket, I don't expect you see an indication of VAT on
the price labels, do you? Nevertheless, it is incorporated
into the price.
Different on-line businesses have different ways of dealing
with this. Some, will have you indicate a currency before
entering the shop. If you indicate a EU currency, VAT is
automatically added to the pricing.
Others will have an advertised price for all buyers - $1 in
your case, but the defacto price for EU buyers is equal to
$1 - VAT. And they pay the VAT for EU purchases to the
taxman. This is often easier for smaller businesses
| | | | However, your customers may be subject to tax for
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purchases
| | of your services. For example, if my company in Belgium
buys translation services from your company, my company
would have to pay VAT on the cost of the translations.
(but, since we are a company, we would calculate the VAT
we received from our customers, subtract the VAT paid and
make up - or receive the difference - from the
government).
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But your company is actually selling goods, and I would sell
a service, something not phisical, and plus I would only
relate to private customers.
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Actually, my company sells services, but almost entirely to
businesses.
| | | | The best thing to do is discuss your situation with a good
accountant.
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It's not easy to find one here, believe me.
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Surely, there must be a good accountant or two in Rome! The
best thing to do is to ask around among Entrepreneurs and
managers of small businesses and ask for recommendations.
This has pretty much reached the limit of my expertise on
VAT and accounting legislation. Hopefully a more qualified
eThesian can offer additional advice.
Jeffrey
--
Helping businesses innovate better
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