Posts by natman

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi guys, sorry for the slowness on the update front!

As you’ve already put together, Akshay (who took over from Dan Michael as Elite Program Manager) finished up with Envato a few weeks ago.

We’ve just re-advertised the position (see link in Palzme’s post above) and if you know someone amazing, please encourage them to drop their hat in the ring. It’s a super important role and we want to make sure we find the very best person for the job.

While we’re recruiting, the whole community team (me, Scott, Travis and Calin) along with Curt from our help team (who also happens to be one of our awesome Elites) are pitching in to make sure reward fulfilment and support continues as per normal :)

Thanks for your patience and understanding and free to get in touch with us directly if you have any questions about any of this.

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi everyone, hope you all had a good weekend :) A couple of new questions came in since my last round up and I’ve pasted these along with answers below. I’m going to un-sticky the thread today but I’ll loop back tomorrow one last time to check for any new questions. After that, please email taxinfo@envato.com. Thanks!


Is there any update on how past VAT issues will be handled? (By ‘past’ I mean transactions before January 1st 2015).

Hi randomnoise, we don’t have any updates since our last announcement, but we’ll let you know as soon as we do. We expect this to take some time as dealing with an authority is generally not a fast process unfortunately. As Collis explained previously, we are working to resolve historic issues with the relevant EU Member States, we aren’t seeking recourse from authors, and we will work to support authors in the event they are audited or need documentation about the past. Hope this helps! :)


@randomnoise, you raise a very important issue and I’ve posted on the topic of who is the actual seller/supplier a few pages back, but my post was ignored so far. I’ll post my message again:

I’ve seen it mentioned several times that this is a 2015 change in the EU law, which I don’t think is quite correct. The actual 2015 change in the EU law refers to the place of supply: whether the supplier’s location is considered to be the place of supply or the buyer’s location is considered to be the place of supply. Before 2015, the supplier’s place was considered to be the place of supply, so VAT had to be charged at the rate of the country where the supplier is registered, but, as of 2015, the buyer’s place is considered to be the place of supply, so VAT has to be charged at the rate of the country where the buyer resides.

Who is considered to be the actual supplier is not changed by the new law, there are only some new clarifications. Article 28 from Directive 2006/112/EC of 28 November 2006 states this: “Where a taxable person acting in his own name but on behalf of another person takes part in a supply of services, he shall be deemed to have received and supplied those services himself.” So, from my understanding, even according to the old law, Envato is considered the supplier. In the new law, there are some additions that elaborate on Article 28 from the old law:

For the application of Article 28 of Directive 2006/112/EC, where electronically supplied services are supplied through a telecommunications network, an interface or a portal such as a marketplace for applications, a taxable person taking part in that supply shall be presumed to be acting in his own name but on behalf of the provider of those services unless that provider is explicitly indicated as the supplier by that taxable person and that is reflected in the contractual arrangements between the parties. In order to regard the provider of electronically supplied services as being explicitly indicated as the supplier of those services by the taxable person, the following conditions shall be met:

(a) the invoice issued or made available by each taxable person taking part in the supply of the electronically supplied services must identify such services and the supplier thereof;

(b) the bill or receipt issued or made available to the customer must identify the electronically supplied services and the supplier thereof.

For the purposes of this paragraph, a taxable person who, with regard to a supply of electronically supplied services, authorises the charge to the customer or the delivery of the services, or sets the general terms and conditions of the supply, shall not be permitted to explicitly indicate another person as the supplier of those services.

The text can be found here, in Article 1 > Article 9a.

The current invoices don’t follow the law, in my opinion, because they still indicate (in a very confusing way) that the author is the seller/supplier, which the law explicitly prohibits in the passage I posted above.

Hi bqworks, I think you’re mainly asking two questions – one about the changes to the law, and the other about the invoice structure.

With respect to the changes introduced this year, yes it’s probably a bit more complex and nuanced than a forum thread is going to capture. There are a number of changes (or clarifications), some of which impact non-EU sellers, some for EU sellers, some for platforms, mostly focusing on place of supply and involvement in the supply. We’ve used some fairly broad language in some of our forum posts for simplicity.

In terms of the invoice language, Envato is marked as supplier for EU VAT purposes and EU VAT is being collected and remitted by Envato.

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi again everyone, I didn’t get a chance to prepare answers to the latest round of questions today, but will get to them on Australian Monday along with any new questions that come in over the weekend. Thanks! :)

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi guys, thanks for the comments overnight. I’ve picked out a couple of new questions and added answers below and I’ll be back again tomorrow to do the same. Thanks again! :)


Not to derail the topic at hand, but there has been a question I’ve been wondering about as it relates to VAT that perhaps you all can shed some light on. How can the EU force a non-EU company to charge a tax to EU members? On what authority can they force a company outside of their jurisdiction to collect and remit tax? If this has been addressed somewhere else and you know the link, that would be great…I understand there are other topics being addressed here and don’t want to hijack the thread :)

It’s a great question. A very broad answer is that when you are trading with people in a particular jurisdiction, regulatory/tax authorities in that jurisdiction will seek to regulate/tax the transaction. To push an obligation outside a jurisdiction has some practical implications in regard to enforcement (i.e. it’s harder to do!) But that doesn’t mean the obligation hasn’t existed, and authorities can and sometimes do seek to exert themselves through inter-country cooperation agreements and other means.

At the end of the day for a global marketplace like Envato Market with both authors and buyers around the world, it’s important for us to be respectful of different regions and their laws, both from a simple legality point of view, but also because of our company values.



Could you please email taxinfo@envato.com with documents you typically use to do this when interacting online? I know the team would find that really helpful to have real user feedback here!

Thank you for your reply. The above link is relevant to the UK law regarding this, here is an excerpt that states typical documents used>

If a customer is unable to supply a VRN but claims they are ‘in business’ but not VAT registered because, for example, they are below their member state’s VAT registration threshold, you can accept other evidence of your customer’s business status eg, a link to the customer’s business website or other commercial documents.

It’s your decision whether to accept alternative evidence that the customer is ‘in business’ and your customer can’t require you to treat a supply as business to business if they haven’t provided a valid VRN.

If you accept that your customer is in business, the supply doesn’t come within the scope of these business to consumer arrangements. With a cross-border business to business supply the customer will be responsible for accounting for any VAT due to the tax authorities in their member state.

As requested, documents I have personally used in the past to prove my business status without a VAT number include:
  • Bank account statement in my own name
  • Tax return first page
  • Utility Bill
  • Business Letter Headed Paper
  • Business Card

Please note that the UK government seems happy enough for anyone with a website to be considered a business. Even my local Costco is stricter :D

It is good to know you are considering alternative proof as I would rather keep purchasing from Envato. I am delighted with the service apart from this situation.

Thanks MigC! I’ll pass this along to our finance team. If anyone else here is in the same boat as MigC but has used different documents to those listed above, please let us know at taxinfo@envato.com. Thanks again :)

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi guys, thanks for all the questions and feedback! Here’s the first round of Q&A and I’ll be back again tomorrow to do the same :)


One last question, where we can find full Envato (in Europe) company details with EU-VAT number, address etc?

We don’t have a physical presence in Europe, but here are the address and MOSS details that appear on EU VAT invoices:

Address: Envato Pty Ltd, PO Box 16122, Collins Street West, Victoria 8007 Australia ABN: 11 119 159 741 EU VAT Number: EU826409867


What about Canada and some other countries that are not EU but may have a sales tax system. Are you supposed to include it in invoicing?

Except where explicitly called out (such as EU VAT), indirect taxes are the responsibility of the author. For example in Canada, if the author meets the relevant threshold for registration for GST/HST, then sales to Canadian buyers would be treated as inclusive of applicable sales taxes. You can add a custom invoice footer and business number to show this to buyers, and you can download a CSV of your statement to quickly ascertain information such as which province the buyer is in.

You can find more information on managing sales taxes (other than EU VAT) in our Help Centre.


Can anyone explain what happens with non-EU authors VAT that Envato collect?

All EU VAT collected on Envato Market, regardless of whether the author is located within or outside of the EU, will be remitted by Envato to the EU via our VAT MOSS in the UK in our name.


Good to see this implemented after such a big lead up. Must be a big relief for the devs! A very serious question, are you having a VAT party?

:-) It’s a big relief, and we’re really proud of the product and dev team. Although it might seem like a simple thing when you’re using the system, it’s actually monumentally complex with a huge number of permutations to consider and build for.

All up we counted, and seventy people worked on the VAT project in different phases over six months. So yes, we’re having a little celebration on Friday for the launch! And then back to work, as we actually have post-VAT VAT work to do (there’s some edge cases and extra features that would improve the VAT system).

Still – a big well done to the whole team who worked on this stuff!!


So now an EU buyer has to actually pay 20.52$ for an item with a 16$ price tag ? .... am I correct?

The amount you pay depends on the EU VAT rate of the country where you’re located. However, you’re correct that EU VAT is exclusive to the purchase price and that EU buyers who don’t provide an EU VAT number will be paying more than in the past.


Hello natman,

as a German resident I make use of a VAT exemption for small trade and start-ups (This is a very common practice for freelancers right here). So what happens to the VAT which is collected on my items?

Will I have a checkbox to opt-out of VAT collection? :-)

Best wishes!

Hi Baumann, great question. We’re currently looking through what VAT exemptions there in different member states and regions. There seems to be a lot of edge cases so we may not be able to adequately implement solutions to all of them, but obviously it would be ideal to have solutions for as many as possible.

Could you shoot an email to taxinfo@envato.com with any extra information you have about the specific German small business exemption (like what it’s called in German) and who it applies to?


Anyway I got a feature request: Can we have Author Terms in PDF format as a single all in on document?

Thanks for the request, we don’t currently have that feature planned, but will pass it on as a suggestion.


Somebody explain me, why Envato collect VAT from my EU buyers if I’m not from EU? Furthermore, why you put this information on Tax Invoice if I don’t need it at all? Weird.

This is due to the EU’s new rules on VAT collection as of January 1st, 2015. For electronically supplied services, EU VAT rules need to be considered anytime the buyer is based in the EU, and with the new rules, that responsibility sits with Envato.


My opinion, and I respectfully admit we do not agree here, is that Envato could do more by allowing businesses to prove their EU business status without a VAT number and with suitable proof (tax documents, company website, commercial documents).

This is relevant because of the fact that I and many others will be paying a tax that legally does not apply to them . For example, EU freelancers under the VAT threshold are not required to pay VAT on these transactions, it is at entirely Envato’s discretion.

Official Source: https://www.gov.uk/government/publications/vat-supplying-digital-services-to-private-consumers/vat-businesses-supplying-digital-services-to-private-consumers#determining-whether-the-customer-is-in-business-a-taxable-person-or-is-a-private-consumer

It’s a great point, and one we are working on in our post-VAT VAT work including ways to confirm business status and exemptions beyond a VAT registration number, and for which countries what proof is applicable.

Could you please email taxinfo@envato.com with documents you typically use to do this when interacting online? I know the team would find that really helpful to have real user feedback here!

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Most of the buyers gives false information, and the lack of verification (eg. A comparison with data from PayPal) may result in exclusion Envato from the MOSS, are you aware of this? if so what steps you’ll make to prevent it?

Thanks prestahome, we track multiple data sources for verification and validation.

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi everyone,

On January 1, 2015, the EU introduced new rules on value-added tax (VAT) collection. Envato will be determining, collecting and remitting VAT on Envato Market purchases by non VAT-registered EU buyers.

After months of community discussions and development work, we’re today releasing the final changes needed to calculate and apply EU VAT on Envato Market.

Read the full announcement

We’ve created this thread for questions and feedback, but before jumping in please:
  • Carefully read the announcement and help center articles
  • Go through Travis’ post to check your question hasn’t already been answered
  • Keep in mind we can’t provide tax advice
  • Post in the relevant thread (off-topic posts will be removed)
  • Contribute in a way that’s respectful, constructive and in line with our guidelines

We’ll be touching base once a day to answer any new questions and on days that we’re not able to do this, we’ll be in touch to let you know.

Thanks for your cooperation!

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

Hi Nat,

I don’t see the buyer location anywhere on our invoice CSV, is this happening yet? Both the instructions page you linked to and the statement page make it seem like this is already live, but the March 5th blog post imply that it’s still in the works..

From your statement page you can download a CSV that shows each sale and relevant location information for those buyers.
The CSV file contains additional details, such as the buyer/author location.
Could you clarify for us, please? Cheers

It’s still in the works medium_rare. We’ll update on the blog and here in the forums again when it’s live.

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

What does Envato do if the author doesn’t fill out all the account information?

On a theme we bought last month, we have an invoice from the buyer and one from Envato. The Envato one is OK, however the author invoice has only the name and country of the author.

This is technically not an invoice and can not be used legally in our country or probably any country. We need minimum a full legal address with postcode, ideally a business number. How can this be resolved?

:confused:

Hey ikonome, it’s a great question. Given your country, I’m assuming you’re considering validity for EU tax purposes. Upon the release of our EU VAT invoices, that should not be an issue as it will be Envato appearing on the invoice as the supplier of record (for EU VAT purposes only).

The broader question we’ll be answering in future. We’re reviewing buyer requests/needs as they come in, and also looking region by region around the world to see how we can improve financial tools and documents to match local requirements.

108 posts
  • Located in Australia
  • Has collected 1+ items on Envato Market
  • Member of the Envato Team
  • Sells items exclusively on Envato Market
+1 more
natman
Envato team
says

So for authors outside of the EU, is Envato expecting authors to check every single invoice, see which country they’re from, and if in same country as the author work out and remit the necessary sales tax? What about authors with 1000’s of sales a month? As the seller, we don’t have any tools to easily do this.

Good question, digitalscience. We’re hoping the upcoming release to add city, state/province and country to the downloaded statements CSV will help authors with this. We’re working on this now and hope to be finished soon. Also, as Collis mentioned in a couple of his responses to previous related forum threads, it’s important to remember that such taxes in many countries only apply after a threshold of income has been reached. Additionally the number of transactions between two parties in the same country outside of our two biggest markets (EU and US) is very low.

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