Tax and VAT Rules are Changing for App Developers in 2015

October 24, 2014 in Announcements (E)

[] London, United Kingdom - Starting from 1st January 2015, anybody selling digital content will need to charge VAT at the rate of their customer's country, as opposed than their own country. According to Pollen VC, 63% of developers are unaware of the changes and 35% don't know what to do about it [1]. To help with this, Paddle, an e-Commerce platform for digital products, has published an overview of what developers need to know about the changes to VAT in January 2015.

Paddle has also published a free VAT calculator, showing the rates applying to sales of digital content from 1st January 2015 in the 28 EU member states. Developers selling exclusively through marketplaces like the iOS App Store, Mac App Store and Google Play Store should not be affected by these changes because Apple already handles VAT on behalf of its vendors and Google looks to be doing so by 1st January 2015.

However, developers who sell direct to their customers will be liable for handling VAT - they will need to identify their end customer's location in order to determine the correct VAT rate to apply. There are also changes to the filing regime - instead of filing a single return in the country in which they are VAT-registered, vendors will need to submit an additional return which aggregates all sales made in other EU countries (under mini one-stop shop (MOSS) simplification regime). Otherwise, they will need to file returns in each EU country in which they sell.

Paddle's e-Commerce platform makes it incredibly simple to sell digital content like apps, games, eBooks and creative resources. Developers selling with Paddle don't have to worry about VAT liability since Paddle handles it on their behalf. Paddle's SDKs for Mac and Windows give developers have an easy way to manage their trial versions, licensing, payments, analytics and more.

Paddle is an online marketplace for digital products. Currently offering over 500,000 products across the Games, Software, eBook and Courses categories on site by some of the biggest and best publishers, developers and authors in the industry. Copyright (C) 2012-2013 Paddle Market Ltd. All Rights Reserved. Apple, the Apple logo, Mac OS X, and Macintosh are registered trademarks of Apple Inc. in the U.S. and/or other countries. All other trademarks and trade names are the property of their respective owners.


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