We are sure that none of our Twitter followers could have missed yesterday that we are a bit in shock over how the new law regarding VAT payments for digital goods sales in Europe will affect us and our business.
For those of you not on Twitter we have recently discovered that a new European law will come into effect on 1 January in which all companies selling digital goods in Europe will be subject to pay VAT based on the country of origin of the customer as opposed to the country of origin of the seller.
Fat Quarterly is a small Business registered in the UK supplying digital goods worldwide. We have sales throughout Europe and the rest of the world and up until now have been subject to UK VAT laws. What this will mean for us is that we are now not only subject to UK VAT laws but to the VAT laws of each and every EU member state. An administrative nightmare to keep abreast of all the VAT laws in each country and to file VAT returns in each and every country to which we sell.
What does any of this mean to you our Fat Quarterly Reader?
Well, to start with as with all new laws the way forward is not as crystal clear as we would hope. We are unsure of how we can possibly 100% comply with the new legislation and unfortunately since any mistake could result in unlimited fines imposed on us from ANY EU member state, we are very nervous about continuing to sell until we are 500% certain that we are in compliance. There are still way too many uncertainties regarding the various platforms and payment portals that we use.
So we will be suspending sales of Fat Quarterly from 31 December 2014.
Buy now to avoid disappointment!
We strongly advise you that if you have had your eye on any back issue of Fat Quarterly, or wish to purchase a subscription that you do so before this date. We will also be taking pre-orders for Issue 20 – Paper Piecing due out early February.
What does this mean for current subscribers?
Do not worry. As current subscribers you have already paid for 4 issues and we will uphold our promise to you and continue to put together issues of the finest quality to fulfill the terms of your subscription.
What does this mean for the future of Fat Quarterly?
We are hoping that come February we will be back all pistons firing and in compliance with the new laws.
However, 1 thing is certain. In order to comply with the laws there will be a price increase in both single issues and in subscriptions and at least for European customers if not for all our customers, you will be required to pay VAT on top of the increased price.
Please be reassured that we will do our best to make any price increase as small as possible and it will only be in place to cover additional administration fees incurred by the new law. We hope you will understand and appreciate that this will be the first price increase since we began 5 years ago.
All of us at Fat Quarterly really want to thank our whole community for the Support you have shown us over the last 5 years and we hope you will continue to Support us through this tricky time and be back in February to celebrate the come back of FQ!!!!