| 12:27 pm on Jul 18, 2009 (gmt 0)|
The change is from Google US to Google Ireland, neither of whom are registered for GST (oddly enough ;) )
For us in .au there is no change in the GST implications - its just a different foreign entity.
| 1:27 pm on Jul 18, 2009 (gmt 0)|
|Lexur says that we will need to be paying the VAT (is that right?) & swa66 says nothing will change |
My understanding from a long and involved telephone conversation with the UK VAT office in 2006 is that for a UK-registered B2B business, sales to other UK businesses must include standard VAT (currently 15%); sales to EU businesses (non-UK) are zero-rated and sales to businesses outside the EU are out-of-scope.
If I understand correctly, this means that for UK-registered businesses no VAT is to be paid to Google Inc. (USA) because it's out of scope and no VAT is to be paid to Google Ireland because it's zero-rated.
Different category, same result.
Further, if I understand correctly, if your business is registered in any EU member state which isn't Ireland, sales to Google Ireland are zero-rated.
If your business is registered in Ireland, that's when you need to include VAT in your invoicing to Google Ireland.
I'm open to correction on any of the above points - they are merely a clarification of how I understand things at present.
| 1:46 pm on Jul 18, 2009 (gmt 0)|
That's exactly the same as my conversation with HMRC Ronin, I might add they highighted one important distinction between the a UK business dealing with Adsense registered in the US being out of scope of VAT - meaning that you do not include the total in your sales excluding VAT, whereas with Adsense registered in Ireland - where you still do not pay VAT as it is zero rated, you do include the total figure in you sales excluding VAT figure.
Again, just my understanding - please feel free to correct me!
| 6:22 pm on Jul 20, 2009 (gmt 0)|
Sorry to go off on a tangent but I switched currencies to GBP a few days ago.
I checked my 'Payment history' and see a balance of £0.00 and a remaining US balance of $xyz.
When I click 'Show prior US Dollar earnings/payments' I then see the message:
'Any remaining US Dollar balance will be automatically transferred to your British Pound Sterling balance between the 12th and 15th day of the month. In the future, you'll be paid according to your British Pound Sterling balance.'
As it has passed the 15th day of the month and the USD amount has not been transferred to the GBP balance does this mean I will not be getting paid this month?
| 9:07 pm on Jul 20, 2009 (gmt 0)|
Should be fine
See this thread:
| 1:47 am on Jul 21, 2009 (gmt 0)|
Remember that, Boy didn't ASA leap out of the starting blocks?
Apparently no cause for concern.
| 9:25 pm on Jul 22, 2009 (gmt 0)|
Seems to me there is a serious difference between out of scope and zero rated - in that it would be much easier for the government to change zero rated items to be at a standard VAT rate. Which I'm sure is the long term plan with aimed harmonisation of duties across the EU.
Whereas it would be much more troublesome to bring non-EU entities into the VAT fold - i.e. there would be a much greater lobby against.
| 10:57 pm on Jul 22, 2009 (gmt 0)|
Actually the EU is moving in the direction of getting more services onto the zero rate (all, not just an handful of exceptions), and the goods have been zero rated for a long time already.
Anyway for anybody who has a VAT number this hardly means anything anyway. If you're forced to collect VAT on behalf of your government, you need to give it to said government, it's always a null-operation in the end for the company involved.
The only tricky bit is when you paid foreign VAT and you need to get that back, it's a big hassle and that's what the EU is removing.
It's the consumer in the end who pays VAT, for businesses it's just an overly complex method of collecting it along the way.
| 4:11 am on Jul 23, 2009 (gmt 0)|
This thread has more paranoia than I've seen for a long time.
I don't live in Ireland, I don't live in the UK, I don't live in EU
BUT I can promise one thing.
The sky will not fall in. Lighten up, your worst fears will never be realised.
| 10:22 am on Jul 23, 2009 (gmt 0)|
I still think it most of it comes from people who aren't VAT registered, and hence aren't used to the concept of VAT being important to do right but not costing you anything in the end.
Add to that there are a few complications in some (all?) jurisdictions with extremely small entities that do have a VAT number, but have a weird status where they cannot recuperate paid VAT (but don't need to collect any anyway), complicating matters if you try to generalize.
For small publishers becoming VAT registered isn't always all that trivial, but taking that out on Google, the EU or anybody else is aside of the point: talk to the government you help elect every so often and get them to make it easier.
And then there's the big one: unlike the IRS in the US who can "own" you if you cheat, most Europeans will not have such a threat over their head if they get caught cheating on taxes. Creating an opportunity for those who like to take some risk.
Not declaring one's income from adsense means not paying taxes on it, easy. One just needs to be careful not to flash the money where the local taxman can see it.
Once Google isn't that US company -read: far out of reach of you local taxman- anymore but is a legal entity inside the EU doing the proper paperwork, things might change there and one might get caught not paying taxes on their income.
| 1:55 pm on Jul 23, 2009 (gmt 0)|
Thanks for the link, however I found the following paragraph on the Inside Adsense blog at [adsense.blogspot.com...]
|Will there be a delay in receiving my unpaid earnings once I make this change? |
No, making this change will not affect the timing of your payments. After you switch to Euro reports, your unpaid earnings in U.S. Dollars will be converted to Euros before the next upcoming payment selection deadline (typically the 15th of each month). For instance, if you make this switch on June 3rd, your unpaid earnings will be converted by June 15th; if you make this switch on June 20th, your unpaid earnings will be converted by July 15th.
That answer totally contradicts itself, ie it says there will be no delay, but then it says if you make the switch later in the month your earnings will be converted NEXT month.
| 8:32 am on Jul 24, 2009 (gmt 0)|
ThirdWheel, I read your post above about the reverse charge mechanism being used for VAT and you said it was in the new terms. Can you point me in the direction as to where to find this? I can't seem to find it.
My new terms to accept (USD>GBP) don't mention it and my localised terms also do not mention it.
I am dubious about proceeding until I'm clear on this (although I realise it will eventually be forced on me whatever!).
| 9:26 am on Jul 24, 2009 (gmt 0)|
I took the plunge. No use worrying about something that I can't change :-)
| 9:33 am on Jul 24, 2009 (gmt 0)|
Billuk, when I posted that, the Learn How The Terms Have Changed included a tax link to https://www.google.com/adsense/support/bin/answer.py?hl=en-uk&answer=64176. I suspect that the link has been removed while the page is being rewritten to be all inclusive.
However, the mention of the reverse charge mechanism seems only to serve to complicate the issue, so instead, and as swa66 stated, focus on the fact you are selling goods to a VAT registered company in another EU country. Google states in the terms that they "will only issue VAT refunds to publishers with an address in Ireland", meaning your earnings exclude VAT. You do not have to pay any VAT, but if you are VAT registered, these earnings (sales) must be entered on your VAT return form. As explained on HMRC's site:
|If you're sending goods to someone who is genuinely registered for VAT in the destination EU country, you can zero-rate the supply for VAT purposes ... |
You can read the full article at [hmrc.gov.uk...]
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