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Upcoming Changes to EU VAT

January 1, 2021, Written by 0 comment

As you may recall, in 2015 changes were made to VAT legislation in the EU which shifted the requirement for the charging of VAT on certain digital services from the place of supply (in our case, the UK) to the place of consumption.

This meant that even as a non-VAT registered UK company, we became responsible for charging local sales taxes in the form of VAT to all of our users in the EU, unless a valid VAT number could be supplied.

We ended this practice in January 2019 when a minimum threshold was implemented, allowing smaller businesses to opt-out of the scheme.

Unfortunately, one of the (many) complications of the UK leaving the EU is that this threshold no longer applies, and as such we need to begin charging VAT to our EU clients with immediate effect.

We understand that this is a situation that none of us want to be in, so to soften the blow, we’ll be adjusting the prices of our services for EU nationals from now until 31st March 2021, so that the price you pay will not increase as a result of VAT. This provides a three month window to ensure that we have your VAT number on file, and to contact us with any queries regarding charges on your account going forward.

Adding VAT to services such as web hosting will create only a minimal additional expense; we expect many EU clients will only see a difference of about €1 per month, though we appreciate that this isn’t an ideal situation, so if we can do anything at all to help, please do get in contact and we’ll do what we can to assist.

Due to the importance of this issue, we’ll soon be sending an email to all affected clients detailing this change, which will provide an opportunity for you reply with any questions or concerns.

Red tape is never fun. Here at Valcato Hosting we promise to do what we can to minimise the impact on all of our affected users. Thank-you in advance for your understanding, and for your continued business!

Jay

Founder and Managing Director of Valcato Internet. Based in Staffordshire, UK but a frequent visitor to the USA and mainland Europe. Passionate about all things billing and admin related, but enjoy getting my hands dirty with some web dev and tech assignments once in a while!

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