How do you manage VAT with Stripe?
https://stripe.com/docs/orders/tax-integration
How do you manage VAT with Stripe?
I know you can charge the local VAT using stripe, described here https://stripe.com/docs/orders/tax-integration, but how do you actually pay the VAT to the related country?
Let's make an example: say VAT in France is 10%.
I sell my service for 10€ (included VAT) with Stripe.
In my account I receive 10€ (imagine a 0% Stripe fee), how do you pay 1€ to the France Government? Do you use an online service or go through a tax advisor/professionist?
Which countr is your company incorporated?
The easiest outcome is if your customer is VAT registered in their country, you can collect their VAT number and zero rate the VAT and you don’t have to worry about it on your end.
If they’re not VAT registered, it’s called a distance sale and you charge the VAT and pay it to your country. There is a distance sale threshold and once you exceed it you need to register for VAT in the country where you are making the sales.
Thanks for your answer! I'll do some research
This comment was deleted 7 years ago
Consider Paddle or Gumroad who deal with VAT for you as well if you're not too far along.
Are they equivalent?
I've not made a detailed comparison. You'd be best prototyping as they'll all have their quirks. They all support subscription based payments though.
Paddle transaction fees are 5% + $0.50 though which is a lot higher than Stripe. Gumroad has lower transaction fees but their web store model might not fit your project. Fastspring is another one but more expensive than Paddle.
Either way, I would highly recommend not wasting your time and risking potentially very complicated to resolve mistakes doing per country tax yourself until you know you've got lots of money coming in. It's easily a project in itself to solve and the time you spend on it is time you're not spending validating your product.
I'm using Paddle for subscriptions for https://www.checkbot.io/ if you've got any specific questions.
This comment was deleted 7 years ago
Thank you so much for this detailed answer! Will deep dive into all these links! Grazie :)