Key points
- Reporting the correct VAT rates and customer-facing prices are two different things. doggso will not automatically update your customer-facing prices.
- You don’t need to do anything for bookings for services and spaces. doggso will automatically report the correct VAT rate.
- You don’t need to do anything for webshop orders and products. doggso will automatically update the VAT rates for the webshop products from 24% to 25.5% on 1.9. New orders after 1.9. will thus use the new rates, and the orders before 1.9. will keep the previous VAT rates.
- When creating or updating courses you must make sure the correct VAT rate is selected. doggso will give a warning.
VAT change vs. Customer prices changes
Firstly, one important observation: all the prices specified in doggso (courses, bookings, products) are prices including VAT. This means that even when VAT changes, if you do not modify your prices by yourself, in doggso there will be no change to the customer-facing prices, just a different share within that sum of price-without-VAT and VAT.To give you an example, if a course now costs 100 €, out of that 19,35 € are VAT. After 1.9., if you do not actively modify the price, the course will still cost 100€, only the VAT part will be 20,31€, approximately 1€ less for you.
Whether or not you want to modify the price of courses, bookings and webshop products is entirely up to you. You can decide to make a change in prices on 1.9 or afterwards. In principle if you want to maintain the same amount after taxes, you should modify the prices with a factor of 1,012, meaning that if, for example, an 1 hour booking was 20€ before, it should now cost 20,24€ so that you are left with the same amount after taxes.
Interpretation of VAT change rules for services in doggso context
Tax administration states that:The point in time when a service performance is completed determines the VAT rate
Value-added tax on a service is allocated to the tax period when the service was given i.e. provided to the recipient. If the service performance is in an unfinished state at the time when the VAT change comes into force, the percentage rate to be applied will be the one in effect at the date when the finished service is provided. This means the date when the end result becomes available to the recipient of the service.
Paying a sum of money in advance
If an advance is paid to the seller, the seller must report VAT for it relating to the tax period when payment was made. If the seller is deemed as having received the advance before the VAT changes came into force, the VAT rate of 24% is applicable.
From taxation purposes courses and space bookings are a service.
Resources, service and bookings
According to the rules above, the VAT for bookings of spaces and services is determined by the moment of the last payment that paid off that booking. Regardless of when the booking will be, if the booking is paid off before 1.9, then the “advance payment” rule applies and thus 24% VAT will be shown in invoice/receipt and in the accounting report.Determining the applicable VAT for booking is automatically done by doggso based on the payment date.
Courses and Enrollments
Unlike bookings where the VAT rate is automatically determined according to the tax administration rules, in the case of course enrollments the VAT is specified in the course attributes, i.e. when you create or edit a course you specify the VAT applicable for that course.In all doggso schools the course payment is required before the course starts. This means that in case no partial payments are allowed, the course start date determines the VAT rate. Courses starting before 1.9. and requiring full payment have a rate of 24%. Courses starting after 1.9. have a VAT rate of 25.5%. Also courses ending after 1.9. and allowing partial payments.
Webshop Orders
Just like courses, in case of webshop products, the VAT rates applicable for each individual product is stored in the product attributes. According to the tax administration the date of delivery determines the VAT rate. To simplify, doggso will consider that all orders are shipped and delivered on the day of ordering - the order date will thus determine the applicable VAT rate.In order to help you, all products in doggso that have a VAT rate of 24% will be automatically updated on 1.9. to have the VAT rate 25.5%