VAT number an indispensable element for opening an e-commerce
Do you want to open an e-commerce business and want to know more about VAT registration, cost and requirements?
Appvizer explains everything about the e-commerce VAT number in this article.
Read to the end to find out more.
How to open a VAT number for e-commerce?
In Italy, the web sales sector is regulated like all forms of sales by the Bersani Decree and in Article 21, e-commerce sales are lumped together with all other forms of distance selling.
If you only occasionally sell online, you are not obliged to open a VAT number, but only to issue a receipt to the customer; if the amount of the receipt exceeds EUR 77.47, you must also put a EUR 2 revenue stamp on it.
The VAT number is made up of 11 numbers, the first 7 of which indicate the taxpayer and the other 3 identify the tax office.
In order to open a VAT number , you must notify the tax office of the start of your activity within 30 days using form AA9/7 if you are a sole proprietor or self-employed, or using form AA7/7 if you are a company.
You may submit these forms by handing them to the tax office, or by sending a registered letter with acknowledgement of receipt.
Furthermore, depending on your activity, you will have to choose the ATECO code and choose the type of accounting regime between: the forfetary regime and ordinary accounting.
After you have sent the signed declaration, you will be given a VAT number that will remain the same until the end of your activity.
What are the requirements for opening a VAT number?
First of all, you must be over 18 years of age and a resident, these two elements are mandatory.In addition, there are also mental requirements, you must have full mental faculties to open a VAT number.All of these requirements are necessary and the lack of just one is a blocking element for obtaining this tool that identifies you as an online trader.
Moral requirements are necessary for anyone wishing to open a VAT number. VAT:
- not having declared bankruptcy
- not having been previously sentenced to a term of imprisonment of more than 3 years
- not having previously been convicted of one of the offences referred to in Book II, Title VIII, Chapter II of the Penal Code, such as, for example, issuing bad cheques, insolvency or fraudulent bankruptcy, usury, kidnapping for the purpose of extortion or robbery not having been convicted of two or more prison sentences or fines within five years
- not having been declared a habitual offender.
Tax regime for e-commerce
Regarding the choice of tax regime, if your turnover is not very high, we advise you to opt for a 'forfettario' regime, i.e., a tax regime that is facilitated and suitable for those with a turnover of less than EUR 65,000 per year. This regime is designed to simplify VATmanagement and reduce taxes. If you opt for this type of regime, you will only have to pay one substitute tax at a fixed rate of 15% on your taxable income.
Moreover, for those who qualify , i.e. start-ups, the rate can be reduced to 5% for the first five years.
This is not only the advantage of the flat-rate regime, but also the exemption from VAT and all its obligations, you will also be exempt from sector studies, you will not be obliged to register invoices, and you will not have to use electronic invoices.
However, this regime has some disadvantages, such as the loss of the benefit of IRPEF tax deductions and there is no possibility of deducting what costs you incur, since the tax is a flat-rate cost taking into account the revenue obtained.
To be eligible for the flat-rate scheme, one must not exceed EUR 65,000 per year, which is the maximum threshold
What are the social security contributions for e-commerce?
In addition to taxes, you will also have to pay social security contributions, so you have to be registered with the INPS separate management as a trader.You will have to pay 2 types of contributions:
Fixed contributions , which cost approximately EUR 3600 and must be paid in 4 instalments, and percentage contributions, which correspond to 24% of taxable income.
As for the percentage contributions, you will only have to pay on the percentage of the part exceeding 15000 euros.
I would also remind you that flat-rate contributors can ask for a 35% reduction on the fixed contributions.
Is it compulsory to have a VAT number to do e-commerce?
A VAT number is compulsory when the activity is habitual; if it is an occasional activity , a VAT number is not compulsory.
You may now be wondering what the difference is between an occasional and a regular activity. According to the Internal Revenue Service, an activity can be considered regular and not occasional if it leads to a high turnover despite being a single business.
In addition, an activity is considered occasional when its duration is not long and it must have taken place in an unplanned and occasional manner.
If you decide to create an e-commerce site, you should definitely have a VAT number, because an activity for which an e-commerce site is created is certainly an activity that will last for a long time.
If you decide to carry out marketing campaigns, you have to open a VAT number, as the activities for which a marketing campaign is carried out are designed to last.
How much does it cost to open a VAT number?
There are costs involved in opening a VAT number. First of all, you have to register with the Chamber of Commerce at a cost of €35.50, which includes secretarial fees and stamp duty. For partnerships and corporations, there are additional costs, including: the cost of setting up the company, which is carried out by the notary, and the registration tax on the certificate of incorporation.
One must also consider the cost of INPS contributions , which must be paid to the Separate Artisans' and Merchants' Management, and the management of the VAT number.
Opening a VAT number is an essential element if you want to run your business without problems. Not having a VAT number will certainly be a blocking element for the management of your business. To be in order, think about all the tax obligations.
Article translated from Italian