4 ms·

I have a question. If business sells something directly for bitcoin (not via 3rd party which accepts bitcoin and proceeds cash), how do they do VAT?

gcp 12y ago
What does bitcoin have to do with this question? Hint: nothing.
- Keyframe 12y ago
  It has to do everything with it. If company sells something directly to a customer and is under VAT obligation and it takes bitcoins in exchange for goods.. how is VAT then distributed to tax collecting entity? I guess that's why 3rd party bitcoin processors are popular because business is getting cash, not bitcoins. I presume if they were collecting bitcoins directly, then it would be no different than dealing with non-convertible foreign currency, which is not a legal tender, and it would be impossible to deal with.
  - gcp 12y ago
    how is VAT then distributed to tax collecting entity? The same way it is with any other payment system, by having the vendor pay the tax collecting authority. Again, the payment system is totally irrelevant here. Seeing your clarification in the other response: As for the issue of the exchange rate and convertibility on taxes, I can only speak from the local law here, but the defining section of VAT regulations says that if the sale "contract" specifies the exchange rate between the used currency and EUR, that is the rate to be used for the calculation of VAT due. If you wouldn't mention the current Bitcoin/EUR rate on the invoice, you move into undefined territory.
deleted 12y ago
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wmf 12y ago
If a business sells something directly for USD, how do they do VAT? (Assuming that the company is not in the US since the US doesn't have VAT.)
- deleted 12y ago
  [deleted]
- Keyframe 12y ago
  You're right. Question is rather how does one issue a receipt if you're exchanging bitcoins for goods. You can't, since it's not a legal tender. So how do they do it if they're not using 3rd party which proceeds them with cash?

gcp 12y ago

What does bitcoin have to do with this question? Hint: nothing.

Keyframe 12y ago
It has to do everything with it. If company sells something directly to a customer and is under VAT obligation and it takes bitcoins in exchange for goods.. how is VAT then distributed to tax collecting entity? I guess that's why 3rd party bitcoin processors are popular because business is getting cash, not bitcoins. I presume if they were collecting bitcoins directly, then it would be no different than dealing with non-convertible foreign currency, which is not a legal tender, and it would be impossible to deal with.
- gcp 12y ago
  how is VAT then distributed to tax collecting entity? The same way it is with any other payment system, by having the vendor pay the tax collecting authority. Again, the payment system is totally irrelevant here. Seeing your clarification in the other response: As for the issue of the exchange rate and convertibility on taxes, I can only speak from the local law here, but the defining section of VAT regulations says that if the sale "contract" specifies the exchange rate between the used currency and EUR, that is the rate to be used for the calculation of VAT due. If you wouldn't mention the current Bitcoin/EUR rate on the invoice, you move into undefined territory.

deleted 12y ago

[deleted]

wmf 12y ago

If a business sells something directly for USD, how do they do VAT? (Assuming that the company is not in the US since the US doesn't have VAT.)

deleted 12y ago
[deleted]
Keyframe 12y ago
You're right. Question is rather how does one issue a receipt if you're exchanging bitcoins for goods. You can't, since it's not a legal tender. So how do they do it if they're not using 3rd party which proceeds them with cash?