What are the cases in which CDON will collect VAT?

In the following two cases of intra-community distance sales of goods, CDON will declare and collect the VAT on your behalf:

• Intra-community distance sales of goods imported into the EU ≤ 150 EUR excluding VAT. Order amount: ≤150 EUR excl. VAT         

Origin of the seller: Anywhere

Origin of the goods (shipment): Outside of the EU

Goods destination (end customer): Within the EU

• Intra-community distance sales of goods made by a seller registered outside the EU, whose goods are stored in the EU

Order amount: Any amount

Origin of the seller: Outside of the EU

Origin of the goods (shipment): Within the EU

Goods destination (end customer): Within the EU

In both cases, the VAT will be directly reported to the tax authorities by CDON. It will be deducted from the payments made by CDON to you.

The CDON IOSS-VAT number must be clearly indicated on the customs documents and on the packages in order to allow customs clearance. A customs report will still be necessary for parcels coming from a country outside the EU.

All customs formalities as well as the payment of customs duties remain is at your charge.

What are the cases in which a seller remains responsible for the VAT reporting and payment of VAT? 

As a seller, you will remain subject to your tax obligations and remain liable for VAT in the following cases:

• You are a seller registered within EU and ship your products from EU to customers located within EU.
• You are a seller shipping your products from a warehouse outside EU to a customer within EU for an amount> 150 EUR excluding VAT.

What is the VAT rate to be applied to the intra-Community distance selling of goods?

The VAT rate to be applied on the intra-Community distance selling of goods is the rate of the country of consumption of the goods (= country of destination of the goods).

It is of high importance to ensure that correct VAT rates are communicated to CDON. If incorrect VAT-rates are registered it can lead to suspension from the marketplace.

What is the basis of taxation of the VAT collected by CDON?

To calculate the VAT, CDON will use the sales price including VAT that you have entered as well as the possible shipping costs of your offer.

Is the VAT calculated per order or per order row?

The calculation of the VAT amount is done at the order row because different VAT rates may apply depending on the items.

What is the intrinsic value of 150 EUR?

The intrinsic value corresponds to the price of the goods themselves without the cost of transport and insurance unless they are included in the price without being separated from the Invoice. This value is assessed on the total amount of the order.

Do I have to register for VAT?

VAT registration for your activities on CDON is mandatory.

If you are concerned by the VAT registration and you have several stores on CDON attached to the same company (identical company name and registration number), then only one VAT registration number will be necessary.

You need to communicate a VAT registration number for those markets where you are active, even if CDON collects and reports VAT on your behalf. This is important since you need to report and are responsible for the VAT due to Intra-Community distance sale of imported goods >150 EUR excluding VAT. Otherwise, the buyer will be charged with double VAT and usually a customs clearance fee charged by the transporter at the moment the goods are imported into EU.

Your original VAT number is also mandatory to communicate to CDON.

If you sell goods to customers within EU via your own website and via CDON, you need to keep clear evidence of the distance sales carried out via your own website and those carried out via CDON.

If you only supply goods to customers in your own country (e.g. a Swedish company to a Swedish customer) and the goods are of EU origin, there are no changes compared to before. You continue to apply the VAT rules in your home country, report the VAT in the local VAT return and pay the VAT to the local tax authorities. You cannot register the sale in OSS.

Will CDON suspend a store if no VAT number has been entered?

It is mandatory and it is your responsibility to register and provide CDON with the corresponding VAT number.

If there is a doubt about your tax compliance, the Swedish tax authorities may require the suspension of your account, which will result in prohibiting the sale of your products to customers on our marketplace.

I am a seller registered outside the EU, shipping all my orders from outside the EU. Will CDON charge VAT on all my sales?

CDON will collect VAT on all your sales, except in the case where the sale concerns a delivery to a customer within EU for a value > 150 EUR excluding VAT. You will have to make the appropriate VAT reporting for this specific case, and you will need to register for a local VAT-number for the countries where your end costumers are.

I am a seller established in the EU. Am I concerned by the E-commerce VAT rules?

CDON will report and collect VAT on your behalf in the following case:
Shipment from outside the EU to a B2C customer of an item ≤ 150 EUR excluding VAT.

If you are an EU registered seller and you ship your products from the EU to customers in the EU, you need to register for OSS or with a local VAT-number for the countries where the customers are.

How will I be charged the VAT collected by CDON?

The VAT will be directly deducted by CDON at the time of payment, as for the commission and service fee.

How will the commission on my sale be calculated following the direct deduction of VAT by CDON?

The rule of calculation of commission does not change.

How can I check the VAT collected by CDON on my payments?

In CDON Connect under Reports and Payment reports. You can see the details of the VAT amounts that are collected on each order.

Will CDON communicate with the Tax Authority? 

Yes, CDON will collect, report and pay the VAT to the Swedish Tax Authority. CDON will also be obliged to transmit a VAT register on request. The tax authorities will thus be able to check the reliability of the data transmitted during audits.

As a non-European seller, can I benefit from IOSS for sales where VAT is not collected by CDON?

 

No, IOSS can only be used for goods whose value is ≤ 150 EUR excluding VAT. In this case, CDON will declare and collect the VAT for you.

 

This information is not comprehensive, and it is your responsibility as a merchant to assure correct VAT reporting regarding your sales.