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Envato EU VAT problems. Need help!

Discussion in 'Design Jobs & Employment Forum:' started by Andyhunder, May 25, 2016.

  1. Andyhunder

    Andyhunder New Member

    Greetings! I am the freelance web designer doing projects in EU. I’ve done a lot of them for Envato.

    But recently it turned out that I might be a subject to EU tax authorities’ investigation, as well as thousands of other Envato authors in EU. I’ve described my problem on one of the forums in April. People told me to consult with tax advisor or lawyer, which I did.

    It turns out that I am eligible to EU VAT as an author. And Envato collects and pays this tax for authors since 2015. But the problem is that I’ve been doing projects since 2013. So who will pay VAT for those two years? If you take all authors from EU, this may be hundreds thousands of Euro.

    What should I do? Can this be the subject for tax authorities’ investigation? Am I in danger? If I am sued for tax evasion, can I summon Envato as a third party responsible for the situation to the court?
  2. Paul Murray

    Paul Murray Moderator Staff Member

    What did your accountant/tax advisor say? If the issue is about back-paying unpaid VAT then I would assume that responsibility lies with you since in the eyes of the EU you're the one that ultimately hasn't paid it.
  3. Levi

    Levi Moderator Staff Member

    There are so many technicalities with VAT when working within the EU that your best bet would be to talk to you VAT/Tax advisors, not to mention each country is different in how it's done. You also have things like VAT thresholds to consider, do you earn enough to actually have to charge VAT or if you even need to charge VAT (printed books for example)

    There's also been a change in regards to how online VAT is charged for digital items etc which complicates things somewhat...
    It gets even more complicated when you supply a service such as web design as depending on who you speak to it might be deemed a digital product and subject to the new laws or it might be deemed a service because you're selling your skills...

    Now your IP says you're in the Ukraine and this is a United Kingdom based forum so to be honest the odds are we're not really going to be able to help you that much and the best advice we can give you is as I said above, talk to the relevent people in your country who will be able to give you more accurate information relevant to your situation.

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