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Why VAT tax on online shopping please someone clarify?
I bought a software online during payment there was extra charges other than the software cost. I contacted software company and they said we do not know why their processing company is charging.
I made payment using PayPal and later contacted the payment processing company and explained that I live in Japan a why did they charge VAT.
After few e-mail exchange they sent this message
Thank you for contacting the online store.
Please be advised that VAT is not only charged on orders placed within the European Union. It is not a charge imposed by our company but by your own country, city or locale.
You will need to contact your local tax authorities for an explanation
about this tax charge.
I also cleared this matter from PayPal Japan and they said they do not charge VAT.
So, question is even if I am not in EU country and the vendor/seller is then am I liable for that VAT?
Any clarification in this regard will be appreciated
Thank you
1 Answer
- Skoda JohnLv 75 years agoFavorite Answer
Prices quoted to companies are quoted less VAT as companies claim back impt tax.
They still pay the VAT but it is added at point of invoice.
You need to understand how VAT works.
If you are outside the EU and the company is dispatching directly to outside the EU you can get the goods without VAT.
You have to complete a declaration to do this.
The goods may be subject to customs duties on arrival.
Some companies may not be set up for this if they do not normally ship outside the EU.