On January 1, 2015, new VAT laws passed by the European Union go into effect that now require businesses to collect VAT even if not based in Europe.
Previously, businesses collected VAT according to the country they operate from. According to the new laws, VAT needs to be collected according to the country of origin of the customer.
If you are selling digital goods, and might have customers in a country that is a part of the EU, you need to collect VAT from those customers.
Each country has a separate VAT rate, and some additional complexity is added for business customers with a VAT exemption - you can read more about it on our blog.
Fortunately, we take care of all of that for you. You can turn on VAT collection in your store's payent methods settings, and we'll do all the grunt work:
VAT collection is a small part of what we offer to digital creators. Create your free store today, and take advantage of a variety of digital fulfillment tools.