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Non-resident ecommerce country taxation; a new trend in international trade

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Last updated on November 18th, 2020 -

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Non-resident ecommerce country taxation

Non-resident ecommerce country taxation

In 2018, Australia came out with a law that requires non-resident businesses to collect and remit tax on their low-value sales into the country. Businesses must register with Australia in order to file and remit the collected tax each quarter. Australia decided to put this into place as a way to level the playing field for Australian businesses that must charge GST on all of their orders. About a year later, Switzerland implemented a similar law and with New Zealand, Norway, and Indonesia following suit, the trend has begun. The UK will be rolling out a similar law at the end of the year and the EU has one coming next summer. You can learn more about the UK VAT scheme in our blog post about the UK post-Brexit VAT changes.

With the growing number of countries putting taxation schemes into place, it’s important to know when and how to register, the requirements to stay compliant, and the differences between each country. If you are registered to collect and remit tax for multiple countries, it can be challenging to make sure you are collecting tax on the correct orders or items, meeting the country’s requirements on commercial invoices and labels, and accounting for all the orders you collected tax on so you can report and remit the right amount at the end of the quarter.

That’s where Zonos can help! Zonos will:

  • Let you know when you are getting close to the threshold and need to register for a specific country
  • Educate you on details for special requirements each country has
  • Automatically calculate tax on the correct orders so you don’t over or under collect taxes
  • Provide you with a summary of orders to report on, along with the correct tax amount to remit

Non-resident VAT GST ICMS ecommerce tax management

Non-resident VAT, GST, ICMS tax collection country guide

Zonos has put together a summary of some key points for each country currently using a non-resident tax scheme. Review this information in the table below, or in the more detailed breakdowns that follow, to stay up-to-date, and to see if you need to get registered for any of these countries.

 Threshold/yrCollect tax onRemitRegisterMore infoTax type
Australia 🇦🇺A$75,000Orders below A$1,000QuarterlywebsiteDocsGST
Indonesia 🇮🇩600 mil rupiahs*All itemsQuarterlyn/a***DocsVAT
New Zealand 🇳🇿NZ$60,000Items below NZ$1,000QuarterlywebsiteDocsGST
Norway 🇳🇴NOK50,000Items below NOK3,000QuarterlywebsiteDocsVAT
Switzerland 🇨🇭CHF$100,000**Items below CHF$65QuarterlywebsiteDocsVAT
* or website traffic of 12,000 visitors
**of low-values sales
***Government will reach out to you

 


Australia’s 🇦🇺 GST taxation law

Threshold amount:
A$75,000 within a 12-month period

Collect GST tax on:
All orders below A$1,000

How often to remit taxes:
Quarterly

How to register:
Register on Australia’s website

Other requirements:
Include a statement on the order’s commercial invoice stating that tax was collected on the order

Learn more about the Australian GST taxation law.


 

Indonesia’s 🇮🇩 VAT taxation law

Threshold amount:
600 million rupiahs or website traffic of 12,000 visitors within a 12-month period

Collect VAT on:
All intangible good and taxable services

How often to remit taxes:
Quarterly for three tax periods

How to register:
The Indonesian government will reach out to you and provide you with a tax identity number

What to do after you register:
Activate your account, update your data online through their system, and follow the requirements provided by the Indonesian government.

Learn more about the Indonesian taxation law


 

New Zealand’s 🇳🇿 GST taxation law

Threshold amount:
NZ$60,000 within a 12-mont period

Collect GST on:
Each item that is below NZ$1,000

How often to remit taxes:
Quarterly

How to register:
Register on New Zealand’s website

Other requirements:
Provide a full tax invoice with each order and include a statement on the order’s commercial invoice stating that tax was collected on the order.

Learn more about the New Zealand GST taxation law


 

Norway 🇳🇴 VOEC (VAT on ecommerce) scheme

Threshold amount:
NOK 50,000 within a 12-month period

Collect VAT on:
Only items that fall within the VOEC scheme (below NOK 3,000 and not certain types of items).

How often to remit taxes:
Quarterly

How to register:
Register on Norway’s website

Other requirements:
Include your VOEC number on the shipping label

Learn more about Norway’s VOEC scheme.


 

Switzerland’s 🇨🇭 low value consignment relief (LVCR)

Threshold amount:
CHF$100,000 of low-values sales within a 12-month period

Collect VAT on:
Anything with a value below CHF$65

How often to remit taxes:
Quarterly

How to register:
Register on Switzerland’s website

Other requirements:
Appoint a fiscal representative in Switzerland, maintain customer invoices for 10 years, and follow any requirements provided by the Swiss government

Learn more about Switzerland’s low value consignment relief (LVCR).


 

Zonos International Compliance

About the author

Michelle Taylor

Michelle is a Project Manager at Zonos who enjoys learning about the complexities of global trade as well as being involved in the exciting possibilities that innovative technologies can offer. She has an excitement for understanding how things work and making sure that our software handles international requirements correctly.

By Michelle Taylor

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