How about Vat EU Regulations For Kitely Shop in $

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Manuel Carius
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How about Vat EU Regulations For Kitely Shop in $

Post by Manuel Carius »

:?: Hi, you all know that the new VAT EU changes are a little difficult in some ways. My question is who is paying the vat when i sell on kitely shop to eu customer not with kc but for dollar by paypal. Is Kitely paying the vat in country of the buyer? Because kitely make the payment transaction with the buyer and keep the amount for 14(?) days because of refund policy and also a fee for selling. Or must the seller pay the vat to country of buyers from eu? At last the question is, will i get the money from kitely or from the buyer? In practise i think from kitely or ???? Think this is a important question for all seller on kitely shop?
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Ilan Tochner
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Re: How about Vat EU Regulations For Kitely Shop in $

Post by Ilan Tochner »

Hi Manuel,

Kitely is an Israel-based company using services provided by US-based companies located in the United States, neither of these countries is part of the EU. We have no nexus in any other country and, as we don't ship any physical goods, the customer information at our disposal is very limited.

Based on this limited information it does not look like we have passed any EU country-specific annual VAT exemption thresholds.

Given the above we don't see a reason to collect VAT on the merchant's behalf nor do we pay VAT to the buyer's country. All money that is paid by Kitely Market buyers sits in PayPal until it is transferred to the merchant's PayPal account. We wait at least 45 days before clearing the funds for transfer, to ensure that the PayPal transaction dispute window has ended before transferring the money to merchants, and we only collect our sales commission when the money has been cleared.

It is also worth mentioning that Kitely Credits are a non-convertible virtual currency. Our Terms of Service forbid exchanging KC for real money and we are very diligent in enforcing that. This means KC paid to merchants will never be converted to real money, so at no point does Kitely interact with buyer's real money prior to transferring it to merchants.

If, despite all this, you believe you have a requirement to pay VAT in any EU country due to your use of any of Kitely's services then it's your responsibility to do so.
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Manuel Carius
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Re: How about Vat EU Regulations For Kitely Shop in $

Post by Manuel Carius »

:idea:
Thanks, that i want to know. But that makes it difficult at all. I think a great help for merchants would be, when selling digital goods on kitely market, there is a possibility to exclude eu customers from buying with dollar/paypal, but allow this with kc. An example is online service selfy, where sellers can select in their store account to deliver to eu buyers yes or no.
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Ilan Tochner
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Re: How about Vat EU Regulations For Kitely Shop in $

Post by Ilan Tochner »

It's an interesting idea, which we'll definitely consider, but I think it's important to remember that we've yet to see any Kitely Market merchant that has even come close to the VAT threshold of any single EU country.
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Manuel Carius
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Re: How about Vat EU Regulations For Kitely Shop in $

Post by Manuel Carius »

Because i come from eu, means when i buy anything from kitely market, than the seller must pay vat to my eu-country. No matter that it cost 1 dollar or 100 dollars, there is no minimum amount for vat paying. When i can not buy for us dollar because i was blocked, i can buy with kc when i am a registered user. This is better for merchants and kitely will get more users. And than inworld selling with kc i think will be more interesting too. And also more merchants from eu will join because there is less problems with vat paying, special for small business owner.
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Re: How about Vat EU Regulations For Kitely Shop in $

Post by Ilan Tochner »

Thank you for the suggestion Manuel, we'll certainly consider it but it might not be feasible without hurting the buyer's shopping experience. We should be able to use IP-based classification to know which buyers are currently inside the EU but I'm not sure we can get the actual country from PayPal before we've already sent the user to complete their transaction (and even then the PayPal account may not include the real information unless it is a Validated PayPal account).
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