Tax regulations
Overview
As your dedicated provider of commerce services, it is 2Checkout's responsibility to stay up to date on worldwide financial and legal requirements to make sure you benefit from a seamless and fully compliant international buying and selling experience.
Find out how 2Checkout handles sales taxes, VAT, regulations, and other complicated updates for you!
European VAT rates
European Union countries
Country | Taxable products/services | Transaction type | VAT rate | Applicability (based on merchant location) |
---|---|---|---|---|
Austria | All | B2C | 20% | All merchants |
Belgium | All | B2C | 21% | All merchants |
Bulgaria | All | B2C | 20% | All merchants |
Croatia | All | B2C | 25% | All merchants |
Cyprus | All | B2C | 19% | All merchants |
Czech Republic | All | B2C | 21% | All merchants |
Denmark | All | B2C | 25% | All merchants |
Estonia | All | B2C | 22% | All merchants |
Finland | All | B2C | 25.5% | All merchants |
France | All | B2C | 20% | All merchants |
Germany | All | B2C | 19% | All merchants |
Greece | All | B2C | 24% | All merchants |
Hungary | All | B2C | 27% | All merchants |
Ireland | All | B2C | 23% | All merchants |
Italy | All | B2C | 22% | All merchants |
Latvia | All | B2C | 21% | All merchants |
Lithuania | All | B2C | 21% | All merchants |
Luxembourg | All | B2C | 17% | All merchants |
Malta | All | B2C | 18% | All merchants |
Netherlands | All | B2C and B2B* | 21% | All merchants |
Poland | All | B2C | 23% | All merchants |
Portugal | All | B2C | 23% | All merchants |
Romania | All | B2C | 19% | All merchants |
Slovakia | All | B2C | 20% | All merchants |
Slovenia | All | B2C | 22% | All merchants |
Spain | All | B2C | 21% | All merchants |
Sweden | All | B2C | 25% | All merchants |
United Kingdom** | All | B2C | 20% | All merchants |
*Verifone Payments BV dba 2Checkout is registered in the Netherlands, impacting the VAT calculations for B2B transactions.
** Post Brexit, we will start collecting VAT through our newly registered UK ID. Till then we continue to collect VAT from the UK via our VAT ID in the Netherlands.
VAT exemption
VAT-registered business customers based in the European Union can pay for their orders while being charged according to the VAT ID they provide. VAT ID support is available for all 2Checkout purchase flows, including Express PayPal Checkout.
Non-European Union countries
Sales made by Verifone Payments BV dba 2Checkout to customers in Iceland, Norway, and Switzerland are subject to each country’s VAT rate. Non-EU companies providing electronic services to customers in multiple EU countries are encouraged to use MOSS (Mini One-Stop-Shop) to collect and distribute VAT more efficiently.
Country | Taxable products/services | Transaction type | VAT rate | Applicability (based on merchant location) |
---|---|---|---|---|
Iceland | All | B2C | 24% | All merchants |
Georgia | All | B2C | 18% | All merchants |
Moldova | All | B2C | 20% | All merchants |
Norway | All | B2C and B2B* | 25% | All merchants |
Russia | All | B2C and B2B | 20% | All merchants |
Serbia | All |
B2C B2B** |
20% 25% |
All merchants |
Switzerland | All | B2C and B2B | 8.1% | All merchants |
Turkey | All | B2C and B2B | 20% | All merchants |
Ukraine | All | B2C | 20% | All merchants |
* Norwegian companies with valid TAX IDs are tax-exempt.
** Serbian companies are charged 5% for the withholding tax, in addition to the 20% standard tax rate.
Non-European countries
Country | Taxable products/services | Transaction type | Tax rate | Applicability (based on merchant location) |
---|---|---|---|---|
Australia | All | B2C and B2B** | 10% | All merchants |
Bahrain | All | B2C | 10% | All merchants |
Belarus | All | B2C | 20% | All merchants |
Chile | All | B2C | 19% | All merchants |
Colombia | All | B2C | 19% | All merchants |
Egypt | All | B2C | 14% | All merchants |
Ghana | All | B2C and B2B | 21.9% | All merchants |
India | All | B2C and B2B* | 18% | All merchants |
Japan | All | B2C and B2B | 10% | All merchants |
Kenya | All | B2B and B2C | 16% | All merchants |
Malaysia | All | B2B and B2C | 8% | All merchants |
New Zealand | All | B2C and B2B** | 15% | All merchants |
Oman | All | B2C and B2B* | 5% | All merchants |
Saudi Arabia | All | B2C and B2B | 15% | All merchants |
Singapore | All | B2C and B2B** | 9% | All merchants |
South Africa | All | B2C and B2B | 15% | All merchants |
South Korea | All | B2C | 10% | All merchants |
Taiwan | All | B2C | 5% | Foreign merchants |
Tanzania | All | B2C | 18% | All merchants |
Thailand | All | B2C | 7% | All merchants |
Uganda | All | B2C | 18% | All merchants |
United Arab Emirates | All | B2C and B2B | 5% | All merchants |
Vietnam | All | B2C | 5% | All merchants |
Zambia | All | B2C | 16% | All merchants |
* Indian companies that provide GSTIN are tax-exempt. No VAT is applicable if a valid VAT ID from Oman is provided.
** Australian, New Zealand, Canadian (Quebec only), and Singapore companies that provide a valid VAT/GST ID are tax-exempt. If a valid VAT/GST ID is not provided, the invoice will be issued with Sales tax. For Singapore and New Zealand, 2Checkout is not required to validate the VAT-ID documents provided by shoppers.
Taxes in Argentina
Argentina has made recent changes to its tax laws which impact purchases by Argentine shoppers. Merchants should be aware of these tax costs so they can adjust pricing (if they so choose) or at least be aware of the competitive landscape of selling in Argentina.
Argentina places the responsibility for applying VAT and other taxes on banks and credit card processors and not on selling merchants. Therefore, 2Checkout will not issue invoices showing tax collected from Argentine shoppers. Instead, the Argentine shoppers' bank will apply an appropriate tax levy on top of 2Checkout charges for merchandise purchased. The bank then remits the tax to the Argentine Tax Authority.
On September 16, 2020, Argentina passed a new tax measure that applies an additional 35% tax on top of existing VAT and other taxes. As such, an item purchased for ARS 100 will ultimately cost the shopper ARS 164.
Canada GST/PST Tax
State | Tax type | Taxable products/services | Transaction type | Tax rate | Applicability (based on merchant location) |
---|---|---|---|---|---|
Quebec | QST | All | B2C | 9.975% | All merchants |
Quebec | GST | All | B2C | 5% | All merchants |
British Columbia | PST | All | B2C and B2B | 7% | All merchants |
British Columbia | GST | All | B2C | 5% | All merchants |
Saskatchewan | PST | All | B2C | 6% | All merchants |
Saskatchewan | GST | All | B2C | 5% | All merchants |
Alberta | GST | All | B2C | 5% | All merchants |
Ontario | HST | All | B2C | 13% | All merchants |
Manitoba | PST | All | B2C | 7% | All merchants |
Nova-Scotia | HST | All | B2C | 15% | All merchants |
New-Brunswick | HST | All | B2C | 15% | All merchants |
Newfoundland | HST | All | B2C | 15% | All merchants |
Prince-Edward-Island | HST | All | B2C | 15% | All merchants |
Northwest Territories | GST | All | B2C | 5% | All merchants |
Nunavut | GST | All | B2C | 5% | All merchants |
Yukon | GST | All | B2C | 5% | All merchants |
US Sales Tax
Verifone Payments BV dba 2Checkout collects sales tax for a number of US states, however, the tax rate varies depending on the address of the shopper.
State | Order with Backup Media | Order without Backup Media |
---|---|---|
Alabama |
YES (for the full value of the order) |
YES (for the full value of the order) |
Arizona |
YES (for the full value of the order) |
YES (for the full value of the order) |
Arkansas |
YES (for the full value of the order) |
NO |
California |
YES (for the full value of the order) |
NO |
Colorado |
YES (for the full value of the order) |
NO |
Connecticut |
YES (for the full value of the order) |
YES (for the full value of the order) |
Florida |
YES (for the full value of the order) |
NO |
Georgia |
YES (for the value of Backup Media if its price is stated separately) |
NO |
Hawaii |
YES (for the full value of the order) |
YES (for the full value of the order) |
Idaho |
YES (for the full value of the order) |
NO |
Illinois |
YES (for the full value of the order) |
YES (for the full value of the order) |
Indiana |
YES (for the full value of the order) |
YES (for the full value of the order) |
Iowa |
YES (for the full value of the order) |
YES (for the full value of the order) |
Kansas |
YES (for the full value of the order) |
YES (for the full value of the order) |
Kentucky |
YES (for the full value of the order) |
YES (for the full value of the order) |
Louisiana |
YES (for the full value of the order) |
YES (for the full value of the order) |
Maine |
YES (for the full value of the order) |
YES (for the full value of the order) |
Maryland |
YES (for the full value of the order) |
YES (for the full value of the order) |
Massachusetts |
YES (for the full value of the order) |
YES (for the full value of the order) |
Michigan |
YES (for the full value of the order) |
YES (for the full value of the order) |
Minnesota |
YES (for the full value of the order) |
YES (for the full value of the order) |
Mississippi |
YES (for the full value of the order) |
YES (for the full value of the order) |
Nebraska |
YES (for the full value of the order) |
YES (for the full value of the order) |
Nevada |
YES (for the full value of the order) |
NO |
New Jersey |
YES (for the full value of the order) |
YES (for the full value of the order) |
New Mexico |
YES (for the full value of the order) |
YES (for the full value of the order) |
New York |
YES (for the full value of the order) |
YES (for the full value of the order) |
North Carolina |
YES (for the full value of the order) |
YES (for the full value of the order) |
North Dakota |
YES (for the full value of the order) |
YES (for the full value of the order) |
Ohio |
YES (for the full value of the order) |
YES (for the full value of the order) |
Oklahoma |
YES (for the full value of the order) |
NO |
Pennsylvania |
YES (for the full value of the order) |
YES (for the full value of the order) |
Puerto Rico |
YES (for the full value of the order) |
YES (for the full value of the order) |
Rhode Island |
YES (for the full value of the order) |
YES (for the full value of the order) |
South Carolina |
YES (for the full value of the order) |
NO |
South Dakota |
YES (for the full value of the order) |
YES (for the full value of the order) |
Tennessee |
YES (for the full value of the order) |
YES (for the full value of the order) |
Texas* |
YES (for the full value of the order) |
YES (for the full value of the order) |
Utah |
YES (for the full value of the order) |
YES (for the full value of the order) |
Vermont |
YES (for the full value of the order) |
YES (for the full value of the order) |
Virginia |
YES (for the full value of the order) |
NO |
Washington |
YES (for the full value of the order) |
YES (for the full value of the order) |
Washington D.C. |
YES (for the full value of the order) |
YES (for the full value of the order) |
West Virginia |
YES (for the full value of the order) |
YES (for the full value of the order) |
Wisconsin |
YES (for the full value of the order) |
YES (for the full value of the order) |
Wyoming |
YES (for the full value of the order) |
YES (for the full value of the order) |
*A flat sales tax rate of 8% is applied to all transactions in Texas.
Frequently Asked Questions
- How is the VAT calculated for orders where I ship a CD and an electronic license key?
- CDs are a backup media, an additional service for the main product, thus they follow the same regime as the main product. Consequently, Verifone Payments BV dba 2Checkout applies the same VAT as to the main transaction of the license.
- It appears that the place of supply is calculated differently for phone consulting and software. Do I have to tell you what kind of service I am selling when I bill someone?
- Yes, you should provide an accurate description of your products in the Order Form/Contract so that we can represent them correctly when we resell them.
- How does 2Checkout calculate the VAT/sales tax value for all orders?
- 2Checkout calculates the VAT/sales tax value based on the delivery address details provided by the customer in the shopping cart.