eStore

Background

Our client is one of the leading manufacturers of pen tablets, interactive pen displays and digital interface solutions.  The head office is located in Japan. The German subsidiary is responsible for the European market.

In 2006 the client introduced eStore, an online shop though which customers may order products directly. The eStore is open for business clients, small entrepreneurs and private customers.

Issue

As sales of eStore increased the sale to private customers in other European countries increased as well. In some countries this led to the fact that the so-called delivery threshold was exceeded with the consequence that these sales to private customers became subject to VAT in the respective European country. This led to tax compliance problems in various European countries. The client preferred a single-source solution and approached our office requesting ECOVIS to manage tax compliance in all European countries.

Solution

We approached our colleagues in the (15) European countries where sales to private customers exceeded the threshold and asked them to examine tax consequences, risks and obligation in their countries. Our office as the coordination centre gathered all the necessary information and provided an overall statement to the client.

Currently

The client is now registered in most European countries and is working with ECOVIS partners in those countries. All communication and correspondence is handled by our office. When new registrations are necessary we approach the respective ECOVIS partner to ensure tax compliance.