With effect from 1 January 2015 new EU VAT rules in relation to the supply of the above services will come into effect.
Currently the place of supply rules are:
– Supplies to private individuals within the EU by a supplier established in the EU, the place where the supplier is located.
– Supplies to private individuals within the EU by a supplier established outside the EU, the place where the customer is located.
With effect from 1 January 2015 the place of supply of the above services will be where the consumer resides. This means that the rate of VAT to be applied to the service will be the rate applicable in the Member State of the customer.
To assist suppliers of these services to meet their obligations a new scheme called Mini One Stop Shop (MOSS) will also come into effect on 1 January 2015. MOSS will enable relevant suppliers to file returns and pay any tax due to a particular Member State through a web portal of one Member State as otherwise the relevant supplier would be obliged to register and file returns in several Member States. The use of this service is optional and will be available to both suppliers established within the EU and outside the EU.
It will be a whole new world of compliance for SMEs from 1st January 2015 when the new EU VAT rules will come into existence. The Mini One Stop Shop (MOSS) is a service which we will be hearing a lot about as it allows businesses to register all their EU VAT once a quarter. It is definitely an added advantage, especially for SMEs. Thanks for the post.