Digital VAT for creators
Digital VAT is the value added tax charged on electronically supplied services, which include downloadable products such as ebooks, presets, templates and music sold online. Its key rule is that, for sales to consumers, VAT is usually due at the rate of the country where the buyer lives, not where the seller is based.
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Selling in the UK
You only charge VAT if you are VAT registered. UK businesses must register once taxable turnover passes £90,000 in a rolling 12 months, the threshold since April 2024. Below that you can sell without VAT, or register voluntarily. Registered sellers charge 20% on downloads sold to UK consumers.
Ebooks and other e-publications are a special case: in the UK they have been zero-rated since May 2020, so a registered seller charges 0% VAT on them. Other downloads, such as presets and templates, carry the standard rate.
Selling to buyers abroad
Sales of downloads by a UK business to consumers in the EU carry VAT at the buyer's country rate from the first sale; the EU's €10,000 threshold applies only to EU-based sellers. Most UK sellers handle this through the EU's non-Union One Stop Shop, registering in one EU country and filing a single quarterly return. Other countries, such as Norway, Switzerland and Australia, have their own rules and thresholds.
Business buyers are different: sales to VAT-registered businesses abroad are usually reverse-charged, meaning the buyer accounts for the VAT.
On stall.bio
If you are registered, switch VAT on in your Payments settings, set your rate and choose whether your prices include VAT. stall.bio applies that one rate across your store and shows it on each receipt. It does not file returns or apply each country's rate, so take advice from an accountant if many of your buyers live outside the UK.
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