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Not something we cover very often, but it seems the EU is introducing new rules that could really ruin things for indie developers. It could also cause price changes across many stores.
It's annoying how out of touch the people are who come up with these rules. The good news is that if you sell through a store like Steam, Desura or other stores they are responsible for it, so it may not hurt as many developers as first thought, but anyone who can't get on a store will get burnt badly.
This basically means that any small developer who is too small to get onto a store that properly implements these rules will have to be VAT registered, and that's even if you only make £1.
You will need to store country details for all your customers for ~28 countries. Instead of charging say UK VAT if you're based in the UK, you would do VAT for the country of the customer. This is utter madness for any small business to manage.
Source
What a bloody mess. Luckily stores like Itch.io exist which are already working on implementing it, and Itch.io is apparently the easiest store to get your game on. Looks like they may get a lot more smaller indie developers pushing games to their store:
We shot off a message to Desura and they confirmed people selling games through them are fine too:
No word back from Humble Store, but we imagine it's the same for them.
It's also worth noting that developers that opted to use FastSpring don't have to worry, as that does it for them too:
It isn't known how this affects Patreon, Kickstarter or IndieGoGo:
See this video for more info:
https://www.youtube.com/watch?v=cZdDIVNaL18
I see where the government is coming from; they want to stop massive corps from using dodgy tax rules to pay really low VAT and that does reduce a governments income, but removing exceptions for smaller businesses can destroy them for admin time and costs.
There is a rather large petition growing here to try to get it changed. I urge anyone in the UK to sign it, now!
It's not clear right now how it affects us, and we have shot off a message to Patreon to ask about it. Article taken from GamingOnLinux.com.
It's annoying how out of touch the people are who come up with these rules. The good news is that if you sell through a store like Steam, Desura or other stores they are responsible for it, so it may not hurt as many developers as first thought, but anyone who can't get on a store will get burnt badly.
This basically means that any small developer who is too small to get onto a store that properly implements these rules will have to be VAT registered, and that's even if you only make £1.
You will need to store country details for all your customers for ~28 countries. Instead of charging say UK VAT if you're based in the UK, you would do VAT for the country of the customer. This is utter madness for any small business to manage.
QuoteAfter January 1st, not only will they have to pay VAT on sales made in Europe, they will also have to VAT-register, file quarterly reports and keep detailed records on all their sales for a period of 10 years. For someone making a little money on the side from selling games (or digital comics, or e-books), it’s just not worth the cost and hassle. Many independent creators have already said they are being forced to choose between breaking the law and stopping selling digital things on the Internet in the New Year. It’s not worth the cost of compliance.
Source
What a bloody mess. Luckily stores like Itch.io exist which are already working on implementing it, and Itch.io is apparently the easiest store to get your game on. Looks like they may get a lot more smaller indie developers pushing games to their store:
@lucyamorris It is something that we're working on. The announcement was very sudden but we're hoping to have something ready b4 2015.
— itch.io (@itchio) December 17, 2014
We shot off a message to Desura and they confirmed people selling games through them are fine too:
@gamingonlinux Yes we are... We've been in compliance throughout 2014
— Desura (@Desura) December 17, 2014
No word back from Humble Store, but we imagine it's the same for them.
It's also worth noting that developers that opted to use FastSpring don't have to worry, as that does it for them too:
seem to be repeating myself massively - if you're worried about these VAT issues then use Fastspring https://t.co/LGCxZV4lfH
— Paul Mode7 (@mode7games) December 17, 2014
It isn't known how this affects Patreon, Kickstarter or IndieGoGo:
@kickstarter @Patreon @Indiegogo do you know how #VATMOSS will affect crowd funding creators from Jan 2015? Wont this cripple your business?
Owen Jollands (@ComicColorist) December 9, 2014
See this video for more info:
https://www.youtube.com/watch?v=cZdDIVNaL18
I see where the government is coming from; they want to stop massive corps from using dodgy tax rules to pay really low VAT and that does reduce a governments income, but removing exceptions for smaller businesses can destroy them for admin time and costs.
There is a rather large petition growing here to try to get it changed. I urge anyone in the UK to sign it, now!
It's not clear right now how it affects us, and we have shot off a message to Patreon to ask about it. Article taken from GamingOnLinux.com.
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Segata Sanshiro 17 Dec 2014
I find these kind of measures pretty hilarious. Those in power need to be seen doing things against major issues like tax evasion, which are ultimately out of their power since the entire global economy is completely dependent on corporate tax evasion.
So what do they do? Token gestures like this which makes no real difference on the grand scheme of things other than to make headlines and only hurts the little guy while Amazon, HSBC (and Valve) and countless others continue to pay nothing. It's kind of ridiculous that Valve S.A.R.L (subsidiary based in Luxembourg) most likely pays next to no tax while some indie devs may have to put their businesses at risk so some people somewhere can score some political points.
Remember a thing a couple of years ago where HMRC would "name and shame" tax evaders and create greater transparency. People expected the likes of Barclays, Vodaphone, etc. but all we got was some small businesses like carpet layers. That same year I believe those considerably larger companies payed around 1% corporation tax.
So what do they do? Token gestures like this which makes no real difference on the grand scheme of things other than to make headlines and only hurts the little guy while Amazon, HSBC (and Valve) and countless others continue to pay nothing. It's kind of ridiculous that Valve S.A.R.L (subsidiary based in Luxembourg) most likely pays next to no tax while some indie devs may have to put their businesses at risk so some people somewhere can score some political points.
Remember a thing a couple of years ago where HMRC would "name and shame" tax evaders and create greater transparency. People expected the likes of Barclays, Vodaphone, etc. but all we got was some small businesses like carpet layers. That same year I believe those considerably larger companies payed around 1% corporation tax.
4 Likes, Who?
This basically means that any small developer who is too small to get onto a store that properly implements these rules will have to be VAT registered in the UK
Not quite. You have to be registered (*) at one "Mini One Stop Shop" (MOSS), not necessarily the UK. Every EU member should have one, so if you're already living in the EU, you should probably register at your local MOSS.
In Germany, for example, this thing is called the "Kleine einzige Anmeldestelle" (KEA) and it's part of the Bundeszentralamt für Steuern.
EDIT: (*) Well, you don't have to, either. You could just do all the VAT crap for every EU member state yourself.
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Sadly, it will probably mean shutting down our Patreon. Since that would most likely be classed under a service of giving users GOL Premium. From what I have seen Patreon aren't replying to people about it.
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This basically means that any small developer who is too small to get onto a store that properly implements these rules will have to be VAT registered in the UKNot quite. You have to be registered at one "Mini One Stop Shop" (MOSS), not necessarily the UK. Every EU member should have one, so if you're already living in the EU, you should probably register at your local MOSS.
In Germany, for example, this thing is called the "Kleine einzige Anmeldestelle" (KEA) and it's part of the Bundeszentralamt für Steuern.
Ah yeah, I was writing from a UK point, but have removed that small reference as this is EU-wide.
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Segata Sanshiro 17 Dec 2014
Sadly, it will probably mean shutting down our Patreon. Since that would most likely be classed under a service of giving users GOL Premium. From what I have seen Patreon aren't replying to people about it.
You could register as a non-profit... Depends if you think its worth the hassle though (no idea how easy or difficult it is in the UK unfortunately).
1 Likes, Who?
Hmm, well, Patreon does the billing and administrative things. You probably don't even know where the people giving you money live, right?
So yeah, this is something Patreon will have to handle. They will have to react to that before long. This is something concerning nearly all people getting money through Patreon.
So yeah, this is something Patreon will have to handle. They will have to react to that before long. This is something concerning nearly all people getting money through Patreon.
2 Likes, Who?
Hmm, well, Patreon does the billing and administrative things. You probably don't even know where the people giving you money live, right?
So yeah, this is something Patreon will have to handle. They will have to react to that before long. This is something concerning nearly all people getting money through Patreon.
It's quite disturbing they are being quiet on it. Seen many complaints across twitter of no one getting a reply out of them.
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I'm french, i'm live in a country with a LOOOOOOOOOOOOOOOOOOOOOT ot tax....... Tax for USB drive/Hard Drive etc.... Grrr.... :'(
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I'm sorry but I'll have to disagree with the author. While it's an obvious inconvenience for the small developers this is a matter that goes way beyond gaming and aims to solve a much more important problem. You know how big companies operating in the states sell their production in America but pay taxes elsewhere? That hurts the national budget. So it does in Europe. Getting this rule means more fair taxation could be in place and more money would go to public services like health care and eduction or even subsidies for small, medium and large businesses. As much as I feel for indie developers this is one of these cases where the need of the many outweigh the need of the few. Plus, I'm sure they'll find a way. Worst case scenario - they'll use Skrill and PayPal for checkout and let them handle at least part of the administrative bullcrap.
2 Likes, Who?
I'm sorry but I'll have to disagree with the author. While it's an obvious inconvenience for the small developers this is a matter that goes way beyond gaming and aims to solve a much more important problem. You know how big companies operating in the states sell their production in America but pay taxes elsewhere? That hurts the national budget. So it does in Europe. Getting this rule means more fair taxation could be in place and more money would go to public services like health care and eduction or even subsidies for small, medium and large businesses. As much as I feel for indie developers this is one of these cases where the need of the many outweigh the need of the few. Plus, I'm sure they'll find a way. Worst case scenario - they'll use Skrill and PayPal for checkout and let them handle at least part of the administrative bullcrap.
Paypal and Skrill acts as banks, so payments directly through them still apply to these new rules. They are not stores, as you can see it's really not that simple.
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Fuck EU, the peoples of southern europe are tired of this monopolistic shit.
Yes, It's very yes... I'm bored, my country is dead. Europe has killing my country and same for other country in EU.
For 4TB Hard Drive we have 60€ tax, imagine...
[Tax of Private Copy in France for EU](https://translate.google.fr/translate?sl=fr&tl=en&js=y&prev=_t&hl=fr&ie=UTF-8&u=http%3A%2F%2Fwww.sudouest.fr%2F2014%2F11%2F25%2Fcopie-privee-la-redevance-cinq-fois-plus-elevee-en-france-que-la-moyenne-europeenne-1747734-4725.php&edit-text=)
and 20% of TVA, enjoy it!
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Keep in mind that the private copying levy, which exists in many countries and yes, is quite high in France, is not an EU law. It's not centralized at all. It was introduced separately in every country, with the record and movie industries pushing governments to introduce them.
Also, legally, it's not a tax, it's a levy. The money is not given to the governments. The money is given to copyright agencies, private companies.
And yes, the USA have such a levy as well, but not for "computer peripherals", only blank media and "audio devices" that can record.
As you can see, this levy is not valid ammunition for anti-European / anti-EU sentiments.
Also, legally, it's not a tax, it's a levy. The money is not given to the governments. The money is given to copyright agencies, private companies.
And yes, the USA have such a levy as well, but not for "computer peripherals", only blank media and "audio devices" that can record.
As you can see, this levy is not valid ammunition for anti-European / anti-EU sentiments.
2 Likes, Who?
StianTheDark 18 Dec 2014
YES! Norway isn't part of the EU because we're so freaking nationalistic! No tax for meh' :D
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I also think you are making too much hustle about it. This is something wich is implemented in the most of e-commerce sites (AFAIK it is implemented for a long time in woo-commerce, the most popular wordpress plug-in, and I implemented it in my company's store in less than two days with testing) ... If you own a store you need to keep all the sales informations anyway (at least in Poland). It is similar with Internet Service Providers -- they all need to keep all the informations about connections of every user for 5 years (so that's MUCH more data) and no ISP went bankrupt because of that.
Paperwork is just something you need to be used to in EU :)
Paperwork is just something you need to be used to in EU :)
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I'm sorry but I'll have to disagree with the author. While it's an obvious inconvenience for the small developers this is a matter that goes way beyond gaming and aims to solve a much more important problem. You know how big companies operating in the states sell their production in America but pay taxes elsewhere? That hurts the national budget. So it does in Europe. Getting this rule means more fair taxation could be in place and more money would go to public services like health care and eduction or even subsidies for small, medium and large businesses. As much as I feel for indie developers this is one of these cases where the need of the many outweigh the need of the few. Plus, I'm sure they'll find a way. Worst case scenario - they'll use Skrill and PayPal for checkout and let them handle at least part of the administrative bullcrap.Paypal and Skrill acts as banks, so payments directly through them still apply to these new rules. They are not stores, as you can see it's really not that simple.
This regulation seems to make a lot of sense to me politically, but I definitely agree its implementation could make finding the right information for tax declarations unnecessarily hard for small businesses. There are, however, a few reassuring facilities in the (not legally binding) [explanatroy notes](http://ec.europa.eu/taxation_customs/resources/documents/taxation/vat/how_vat_works/telecom/explanatory_notes_2015_en.pdf). Read section 9.5. "Detailed issues arising from the provision". It also includes a note about payment providers. It's also worth pointing out that VATmoss is created as a solution to the problem - it isn't the problem itself.
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"to choose between breaking the law and stopping selling digital things"
It`s easy choise. You must break the law.
It`s easy choise. You must break the law.
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Fuck EU, the peoples of southern europe are tired of this monopolistic shit.
Monopolistic? I am not sure you know what words mean.
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Fuck EU, the peoples of southern europe are tired of this monopolistic shit.Yes, It's very yes... I'm bored, my country is dead. Europe has killing my country and same for other country in EU.
For 4TB Hard Drive we have 60€ tax, imagine...
[Tax of Private Copy in France for EU](https://translate.google.fr/translate?sl=fr&tl=en&js=y&prev=_t&hl=fr&ie=UTF-8&u=http%3A%2F%2Fwww.sudouest.fr%2F2014%2F11%2F25%2Fcopie-privee-la-redevance-cinq-fois-plus-elevee-en-france-que-la-moyenne-europeenne-1747734-4725.php&edit-text=)
and 20% of TVA, enjoy it!
You realize that exactly is not EUs fault but France's own fault, right?
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I'm sorry but I'll have to disagree with the author. While it's an obvious inconvenience for the small developers this is a matter that goes way beyond gaming and aims to solve a much more important problem. You know how big companies operating in the states sell their production in America but pay taxes elsewhere? That hurts the national budget. So it does in Europe. Getting this rule means more fair taxation could be in place and more money would go to public services like health care and eduction or even subsidies for small, medium and large businesses. As much as I feel for indie developers this is one of these cases where the need of the many outweigh the need of the few. Plus, I'm sure they'll find a way. Worst case scenario - they'll use Skrill and PayPal for checkout and let them handle at least part of the administrative bullcrap.
This guy got it.
People flying off their handle are just confused and pseudo-educated in economy. Yeah, this might be uncomfortable but it won't have impact on most people and it's more or less necessary to curb problems that actually matter (corporate tax evasion).
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People flying off their handle are just confused and pseudo-educated in economy. Yeah, this might be uncomfortable but it won't have impact on most people and it's more or less necessary to curb problems that actually matter (corporate tax evasion).People "flying off their handle" (whatever that means) perhaps have a reason, you know? Like it’s making selling digital goods/services *even more* complicated, as if it wasn’t already difficult enough. And of course it will impact most the little guys trying to sell their work directly. Because no, Paypal will not handle this.
Paypal won't, Google Play, Steam, Desura, Humble Store, Bandcamp, Amazon, all of these, will.
Most people who had it "easy" before just dodged taxes altogether before, it will be just more closely watched, now, that's not a bad thing.
It would be reasonable if the legislation counted with a low lump sum for very minor producers, but you can't just say "wow taxes are complicated, I shouldn't have to bother", that's not how the world works.
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