I have a question to all of you who sell digital goods (outside the European VAT MOSS scheme) to countries such as US, Canada, Russia, Norway, India, Australia etc.
In some of those countries, you can not sell at all without registering in their jurisdiction:
- Belarus (B2C)
- Colombia (B2C+B2B)
- India (B2C+B2B)
- Russia (B2C)
- Serbia (B2C)
In other countries there is a threshold. If you exceed certain sales, you need to charge sales tax and register or do some reporting in those countries:
- Australia = above 75000AUD (ca. 47.500€) in global sales to B2C in a 12 month period
- Canada = above 30000CAD (ca. 20.000€) in global sales in the last four consecutive quarters
- New Zealand = above 60000NZD (ca 35.000€) towards B2C in New Zealand
- Norway = 50000 Norwegian Krone (ca 5.000€) towards B2C in Norway
- United States = In certain states digital products are taxable. So if you have a physical presence (or also economic nexus) you need to comply with the sales tax requirements of that state:
- Nebraska = Threshold: sales into Nebraska exceeding $100,000 or sales were made in 200 or more separate transactions in the current or last calendar year
- New Jersey = Threshold: sales of $100,000 in New Jersey, or more than 200 transactions in the state in the current or last calendar year.
- Washington = Notice & Report Threshold: Sales of $10,000 or more into the state
Do you simply not sell to those countries or do you sell and once you’ve reached the threshold you just stop selling there?
What if you sell to US customers but just not in certain states where there is a digital sales tax.
How do you block those specific states?
Do you also block the credit card coming from such states?
How are you dealing with this and does anyone know any services that can help with this?
Thx a lot!