Tuesday, November 17, 2009

Tax Doesn't Have To Be Taxing

.... Apparently it does actually.

I spent 3 hours in a meeting today, which I initially thought was to prepare us for the UK rate change on 1st January but was actually to tell us that tax rules throughout the EU are changing, especially in relation to services. And with about 6 weeks to go, some of the national legislation has not yet been published. This is an issue for us when transacting for example out of Germany.  Most of this stems from an EU directive passed in February 2008, however national Governments have still not put the legislation in place formally leaving all businesses precious little time now to be prepared.

The point is, I work for a big IT company, and we pay a well known Financial Services firm for accountancy advise and we pay a lot of money for a well known IT software to transact our business on. None of it can be compliant today with the (known) changes.  We will work hard and undoubtedly have to pay to get compliant before the deadline.  But we have just 6 weeks to meet compliance with as yet unwritten tax laws and with as yet unannounced VAT rates and changing EU VAT regulations.

If you are a part of, or know someone who is a part of a business that transacts cross-border sales, especially if they transact any type of services, please tell them to call their tax accountant right away. My company will find this exceptionally challenging - if you are a small business you are about to get completely walloped.

It is not just rules and rates that are changing; there are filing timeline changes in some EU countries (with subsequent fines for non-compliance). 

Good luck!

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