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Now Collecting VAT on Envato Market

On January 1, 2015,  the European Union (EU) introduced new rules on value-added tax (VAT) collection. Envato will be determining, collecting and remitting VAT on Envato Market purchases by non VAT-registered EU buyers.

After months of community discussions and development work, we’re today releasing the final changes needed to calculate and apply EU VAT on Envato Market.

What does this mean for Envato Market buyers?

Starting today, we will be collecting EU VAT from Envato Market buyers who are located in the EU and don’t provide a valid VAT registration number. We will calculate the VAT based on the location of the buyer, apply the VAT at the time of sale and remit it to the relevant EU member state authorities using Envato’s EU MOSS VAT registration.

VAT won’t be applied to purchases by EU buyers with a valid VAT number however they must account for VAT using the reverse charge mechanism. This will be noted on relevant invoices.

These changes don’t apply to buyers located outside of the EU.

Detailed information and FAQs are available in the following help center articles:

What does this mean for Envato Market authors?

For EU VAT purposes only, Envato will be the supplier of record for your transactions with EU buyers. We’ll collect the correct amount of EU VAT, as determined by the buyer’s location, and remit it under Envato’s own VAT registration. EU VAT will be collected, even if the author of the item is not located in the EU.

As Envato is now responsible for determining, collecting, and remitting VAT for all purchases by EU buyers, authors do not need to calculate and send VAT separately. This is due to new EU VAT rules starting January 1st 2015.

Today’s changes mean we’re now issuing EU VAT-compliant commercial documents (e.g., invoices) for relevant transactions. These list Envato as the supplier of record as well as our EU VAT registration number.

Detailed information and FAQs are available in the following help center articles:

Update to Market Terms

For further clarity, we’ve updated the Market Terms and Author Terms so these agreements reflect the treatment of sales for EU VAT purposes.

In the Member Terms, section 20 covers taxes and EU VAT specifically.

In the Author Terms, section 22 covers taxes and EU VAT specifically.

Read the Market Terms and Author Terms.

Discussion

We’ve created a forum thread for questions and feedback. Before jumping in, please carefully read the help center articles linked to above. As with previous tax-related discussions, please also keep in mind that we’re not able to provide advice specific to your tax situation (instead, we encourage you to speak to a professional accountant / tax advisor) and you can also always email: taxinfo@envato.com.