Businesses who provide goods or services in a foreign jurisdiction with a VAT regime must comply with the relevant VAT laws of that country. There are several cases where it will be a legal obligation for a company to register for VAT in the country because they are undertaking taxable business activity. Such activity includes:
- Importing goods into the country for sale or distribution
- Buying and selling goods locally
- Selling goods to individuals over the internet (revenue thresholds may apply) Storing goods in a warehouse
- Organising an event in the country (specifically if there is paid admission to the event)
- It is the company’s responsibility to register for VAT prior to commencing taxable transactions and once registered, one must comply with the compliance and reporting requirements.