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VAT at 25% added but you're an american company

The VAT added on top of services you buy in Sweden is normally 25% (in other parts of EU it may be different numbers). The VAT is of course a tax and is set by the company in question (in my case Sweden).

So, the problem with you adding 25% VAT (eg. Swedish VAT) on top of the cost for your services is that you don't seem to be a registered Swedish (or even EU entity). I.e - the "tax" I'm paying is just to your company which isn't the purpose of it. Unless of course you're an EU/Swedish entity in which case you may add the applicable VAT on top. You seem to be an american company though - there's no EU VAT-number on the receipt and your address is in the USA.

To reiterate - you seem to just take out an additional amount of 25% from me because I'm  a Swedish citizen but you just take that money and that's not how this is supposed to work.

If there's a US tax on services sold, that would likely apply here (but I'm not knowledgeable when it comes to US rules) and should be added to the receipt. However - you adding 25% VAT for Swedish  customers without being a registered company in EU (or Sweden) is not correct.

Forgive me if I'm misunderstanding something here - in that case, please explain how this all works from your perspective.

Thanks,

John

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  • Hi John,

    Just searched for the answer, so not 100% sure, but since 2021 non eu companies can register to One Stop Shop (OSS) where they have to report (and pay collected VAT) quarterly an aggregated report and OSS manages to channel tax income to the appropriate member states.

    https://vat-one-stop-shop.ec.europa.eu/one-stop-shop_en

    "Without the OSS schemes, the supplier would be required to register in each Member State in which he supplies goods or services to his customers. The OSS schemes are optional for taxable persons. However, when choosing to use an OSS scheme, the taxable person must apply the scheme to all supplies falling under this scheme in all relevant Member States. The taxable person cannot, therefore, opt to use the OSS scheme just for supplies in some Member States and not for supplies in other Member States. Once opting into the scheme, it is applicable for all supplies to consumers in all Member States. "

     

    Regards, 

    Aurel 

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