So, I’m confused.
Customer pays 125 USD for the product. 25 USD (i.e.) is the VAT fee of IT.
Then there is i.e. 20 USD author fee. That is included in the sale, but has it’s invoice number.
As my company is located in the EU, some tax consultants are not sure, but some are saying that that author fee has to be taxes with VAT (in my case that is 21% of i.e. 20 USD would be 4,2 USD), and I must add it and pay it to local tax authority. But then I feel like double-taxed, as the that VAT was already paid once for that amount when somebody bought the product. As appears they treat that as a Envato service to my company, and not the author fee as a tax, or service to the customer.
Also, Envato smart on taxes, and gives all the bills with correct taxes, but author fee does not have a separate viewable invoice (but it also does not have for commercial reason an author fee line on the regular invoice taxes). But Envato gives this fee in summary as NOT taxed, with 0.00 tax (the EU VAT Tax is empty here). As they could then write the invoice with VAT, but they don’t do that, appears that is not needed then?
Or is that somehow relates to the VAT number entering in the setting, as my company is no VAT-payer yet, but I can register as a VAT payer voluntarily.
Anybody here in EU does the taxes and what you do with author fee? Pay a VAT on it? As we all (each EU country) just have to follow the Brussel’s directive?
This is taken from EU VAT Information for Authors:
Why do Envato’s Service Fee invoices not show EU VAT?
For EU VAT purposes only, Envato steps into the supply chain as the supplier on record.
This means that for VAT purposes, an EU buyer buys from Envato and EU VAT is accounted for on this transaction.
As a result for EU VAT purposes only the author is deemed to have sold the item to Envato. Since Envato is not an EU entity, there is no further EU VAT applicable.
For all other purposes, including selling to non-EU buyers, and including income tax purposes, the author is selling directly to the buyer and receiving a sale income.
Subsequently the author pays an author fee to Envato. You will receive a non-VAT service fee invoice for all author fees and you can use this for accounting for income tax.