Does small US LLC company selling B2C to EU customers have to add VAT?

[vgahdmi123]

Hi all,

I am currently thinking about moving my company to Delaware. I am selling VPN Licences (Digital goods), approximately 9000 Eur per month in sales which is 100k Eur per year.
This is small business, but per EU regulations (most of my customers are EU), seems like I have to get into VAT System and pay 25% VAT on all income from EU Customers, even I am US LLC.

Can you please confirm this is true? Will stripe or other payment processor control the payments and report this, or I can get away with 100k per year since this is considered small business i guess?
Any other solution?

thanks for advices

 

[daniels27]

No, you need to register if you have just one sale.
https://stripe.com/en-ch/guides/introduction-to-eu-vat-and-european-vat-oss

For example, in Spain there is no registration threshold. Businesses in Ireland, on the other hand, have two different VAT thresholds: €85,000 for local businesses selling goods and €42,500 for local businesses selling services. These domestic registration thresholds apply only to domestic, or in-country, business. Businesses based outside of Europe or selling cross-border within Europe have to register before their first sale.

 

[vgahdmi123]

what is chance stripe will figure out or report me if i dont register? 25% eu tax is a lot.

 

[Don]

what is chance stripe will figure out or report me if i dont register? 25% eu tax is a lot.

They report almost everyone now due to CESOP (If the number of payments made to one recipient exceeds 25 in a quarter, data for all these payments must be reported).

 

[vgahdmi123]

then LLC US does not make sense, i can simply keep EU company and pay same 25%

 

[daniels27]

US LLCs only make sense in limited number of cases, mainly by digital nomads etc. that have no problems with PE and PEoM. They will save on profit tax.

VAT has been fairly streamlined and all major countries have laws in place that force all companies, irrespective of the place of incorporation, to collect and remit VAT.