If you’re from the UK, please sign this petition.
Rachel
P.S. Hat-tip to Rachel A. for tweeting about this petition, which is how I found out about it…
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We signed this yesterday, lets hope they take notice of the thousands of small businesses this will have a dire impact on.
The post guidelines says “Constructive criticism is welcome, but criticize ideas, not people.” were merely offering a solution to a problem that is going to be a major headache to EU businesses so it is highly relevant to this topic, not sure how this can be considered spam!
You’re right, that wasn’t a very civil post. Apologies. I’ll remove it.
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How not to register for VAT MOSS (funny):
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Love it! More or less went through that myself yesterday. “MOSS” and “Mini One Stop Shop” are obviously not in the automated system’s dictionary yet… Just said “VAT” after the second attempt.
Seems you need to “Register” for MOSS before you can “Enrol” (for anyone else that is trying to do what I did and just trying to enrol).
This is my life right now 
At Ravelry, we have a knitting and crochet pattern marketplace that is similar to Etsy (before they had Direct Checkout) and Bandcamp^ in that sellers bring their own PayPal account and we aren’t part of the transaction. We have about 2000 sellers in the EU who have sold digital products to other EU countries in the last year and almost all of them are far, far below the current VAT thresholds in their respective countries.
Sucks. We’re working on a solution but it’s not going to be pretty and some shops are going to choose to stop selling to the rest of the EU, which is really sad.
As far as I know, there are no payment processors that provide all the things that you need to run a marketplace (ie. like Stripe, PayPal, etc) that also take care of VAT for you. If you are selling goods or services and trying to accept money without handling VAT yourself, it looks like you left with Fastspring and… not much else.
Their service isn’t something we can use but Recurly has put some effort into this, in case it helps anyone: https://docs.recurly.com/eu-vat-2015
^footnote: Neither Bandcamp nor Etsy has said anything about any of this yet.
Also Avangate (and others). But Fastspring and Avangate are very much set-up for software vendors. I’m not sure they would be a good solution for people selling crafting related stuff.
Things like ebooks have different VAT classes in different countries. In the UK they are charged at the standard rate, but in France and Luxembourg for example they are charged at a reduced rate.
I see you’ve got the types of good that applies to the different rates, are those standardised across different countries?
Things like ebooks have different VAT classes in different countries.
This is by far the biggest problem I have with this. It is hard enough to understand UK VAT law to know what the correct rate to charge is (think the heated pasty v cold pasty debate a little while ago). Now we need to know the nuances of VAT law for all 28 member states. But far the majority (all?) will use their standard rate, but if there is special provision for software downloads, or worse a specific type of software, then we risk an unlimited fine for charging the wrong VAT rate.
The burden that this places on small businesses, in combination with keeping up with any changes(!), is ridiculous.
I’ve got to question the logic of trying to handle all this chaos yourself rather than use a ‘full fat payment processor’ who does it for you.
Sure - your loosing some cash in higher fees (but not as much as it first looks like as you’re always going to be paying some fees) but unless you are shifting some volume then I would think you the time spent trying to do this in your own payment systems will just overwhelm any savings.
Whats your time worth?
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The problem is there’s really only a few payment processors that can fix it for you. They have to be resellers not just payment processors. Since they’re resellers you’ll probably have to change a lot about how your existing sales process works, etc.
That’s handing over a very key part of your business to a third party.
I think if you are starting out then yes, it’s a good idea to lean on third parties but the danger of too tightly integrating with one is that they can then pretty much do what they like in terms of fees and so on as the cost of moving is high.
And as Ian points out it isn’t just about using a third party for payment, you are making a third party the reseller of your stuff. Potentially there you lose out on a lot of data that is critical to your business. I’ve run a VAT registered business since 2003, I’ve been dealing with cross border sales of a product since 2009. Yes it is work, but we have systems that deal with it and we can change them. This puts us in a far far better situation than people who are integrated with third parties who are not offering any help with these new rules.
We updated our accounts system in July to cope with being able to charge VAT at the customer’s rate. Our issue is really just in checking that we are gathering correct proof of location. Not really a technical issue at all, we just need to know what is accepted.
@rachelandrew - How are you sourcing your VAT rate information? Are you using https://vatapi.com/ (or similar) or just doing it manually? I’ve been talking with the HMRC software support team and they said they have no plans for an API to cover it, but it just seems so fundamental to this change that I can’t understand why there isn’t a central official API for this information. its driving me nuts 
I am just going to maintain a list myself and keep an eye out for changes, certainly for the time being. It’s not like VAT rates are highly volatile. The important thing is just having a way to be notified or at least to check regularly for updates.
Once I’ve ironed out all the gotchas with our implementation I’ll publish a list of any resources, authoritative sources for this stuff.
Are the new rules compatible with the flat rate vat scheme?
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After going through all the stages: shock, anger, disbelief, denial, etc, there is no other way than to accept this.
For reference, I’m in The Netherlands.
I applied on line for MOSS, and was registered within four weeks. So that was not so bad.
Now, I’m very busy adapting my systems for this. Since a few days PayPal at least seems to provide me with a full customer address for each payment. So that’s good for the two pieces of location evidence required. I added some extra logic to my checkout system to retrieve the IP address as well. This now works for all of my four payment options: PayPal, Stripe, iDEAL and bank transfers. I’m not sure about privacy regulations though. Perhaps it’s not allowed to store this data. Or perhaps it’s not allowed if they origin from Germany or Hungary. No clue really.
Another thing:
I understood the main objective is to create a level playing field. I think it’s unfair that I currently have to collect VAT starting with my first sale in the UK, while sellers within the UK are free of collecting VAT for their domestic sales up to GBP 81000. So they have a 20% price advantage. Not that I was aware of this until very recently…
At least that inequality seems to be gone now… Sorry if that hurts 
Anyway, I’m looking forward to visits by tax representatives from all 28 countries to check my VAT administration. I’ll put the kettle on and make sure I have my dictionaries ready.
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I might’ve missed this, but what’s supposed to happen about old versions of applications which embed payment forms but don’t collect location data?