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Diabolique says

OK, but still I don’t understand why Envato doesn’t add 10% VAT to theme price.

If they sell themes for non-business customers then they should collect 10% VAT – http://world.tax-rates.org/australia/sales-tax

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Gareth_Gillman says

Because to non-business customers, you don’t need to display the Non-vat and vat price, so the vat would be included in the price.

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alast says

envato doesnt charge vat. it charges gst (10%) on all deposits/purchases from the buyers (including the ones fron EU) and pays gst to the australian tax authorities. but we would really want an oficial response to this.

i think there’s an EU law that says that all non-EU companies that provide digital goods to EU customers should charge VAT depending on the country where the customer is located. Then envato would have to pay the vat to that country.

in reality, not many companies from outside the eu respect this legislation. some companies never even heard of it while others choose to ignore it (and i dont blame them). i mean the eu doesn’t really have the authority or jurisdiction to impose laws to companies from all over the world.

but again, a response from envato regarding this matter would really be apreciated.

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Diabolique says

Then price of theme for companies should be $45.40, not $50.

i think there’s an EU law that says that all non-EU companies that provide digital goods to EU customers should charge VAT depending on the country where the customer is located. Then envato would have to pay the vat to that country.

As I know digital good is a service and if company is registered in Australia then service is executed in Australia, so buyer pays their value added tax.

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psvent says

I think we are just overcomplicating things.

If you are an EU resident, whether buyer or author, you just don’t have to care if Envato is charging VAT or not, that is Envato’s responsibility.

If you are buyer, you pay the final price and that’s it.

If you are an author, as previously said, you are actually “invoicing” Envato for the earnings you make on Envato, and because Envato is in Australia, VAT does not apply (in any EU member country).

I had a similar situation when I worked thru oDesk and after clearing it with the Tax offices here, I was to invoice oDesk and not the end customer so I would (as I am not yet an author) do the same here on Envato and I wouldn’t charge VAT, as I have to do that only for services provided here in Slovenia.

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ChapterThemes says

psvent is right.

When i started i’ve checked and researched everywhere, even check with my accountant.

You don’t have to pay VAT from money earned at and payed from Envato. They are located in Australia and therefore you don’t have to pay VAT in Europe.

What Envato does with their earnings isn’t our business

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