Get the most out of tax havens on the internet
Truths and stories, and the sales tax in e-commerce
Meanwhile, a variety of online retailers run their business out of various non-EU countries (offshore). A clever idea, but it also includes some hooks. So that you and your clients do not run into an “open knife”, here are some views to this subject.
For non-EU countries (so-called supply from third countries), the customs fees as well as some taxes have to be considered first:
* Duties,
* Import turnover tax (19%, or in case of food, books, newspapers, works of art 7%) or
* For some products a special consumption tax (for example alcohol, cigarettes, coffee).
The amount of duty depends on the type of goods. Usually packages whose value are less than 150 Euros and contain no alcohol, perfumes, tobacco or coffee remain duty free. Customs regulations are not easily predictable, and often the custom duty depends on the technical configuration of the, for example, electrical appliance. Beyond that, some tariff reductions may apply to certain countries (e.g. Switzerland).
Importation VAT
In principle, the importation of goods to Germany gets charged additionally to the customs with the import tax. The imported goods will be relieved from the tax from their country of origin and will therefore be taxed with the national tax. (Import turnover tax). The import turnover tax is equal to the value added tax; therefore for most products it will be in Germany 19% and is applicable for shipments over 22 Euros.
Customs inspection
All batches from non-EU countries are presented to the customs. Many packages will be opened by customs officials. If customs becomes due, one has to distinguish whether the postage was done using the normal post or a parcel service. The post pays the duty in advance. Only later, when the mail is delivered, the messenger collects the money from the recipient. It might be different using a parcel service. Therefore you should review these procedures with the shipper.
An interesting view on the subject of tax liabilities can be found in the book “Steueroasen Ausgabe 2010" by Hans-Lothar Merten on page 472. In short, it refers to a turnover threshold from non-EU countries amounting to 100.000 Euros annually revenue. This means, that e-stores with a turnover of up to 100.000 Euros annually do not need to register in any EU member state and therefore not pay the applicable VAT for the entire European business.
Do you have any questions about this broad topic? Or do you wish a personal consultation? We are at your disposal:
