Tax question for EU translators that work for non-european businesses Thread poster: Karin Renkema
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Karin Renkema 
Netherlands
Local time: 22:54
Member (2023)
English to Dutch
+ ...
Hello fellow linguists,
I am a freelance translator working from the Netherlands. I've come across quite a few platforms that have multiple headquarters or offices. For instance getblend, to name just one.
For tax purposes, it's easiest to work for companies who are based in Europe, as there is this rule that you can earn money by working for countries within the EU and in this case you calculate the taxes for Europe. I am not sure I am phrasing it correctly; I am not... See more Hello fellow linguists,
I am a freelance translator working from the Netherlands. I've come across quite a few platforms that have multiple headquarters or offices. For instance getblend, to name just one.
For tax purposes, it's easiest to work for companies who are based in Europe, as there is this rule that you can earn money by working for countries within the EU and in this case you calculate the taxes for Europe. I am not sure I am phrasing it correctly; I am not a financial guru at all, but this is what I understand from how it currently works.
I was wondering if the same rule applies for countries who have several headquarters all over the world.
For example, if a company is by origin Chinese but they have headquarters overseas, in Russia, Romania, Italy, etc.
Can you then for your own country take the closest one (for instance an Italy office) and have that count as the headquarters that you can take into account when doing your taxes? So that you can count the taxes for Europe for this company? Or does it not work that way?
Are there any EU translators that have experience with working for non-EU companies? And if so, what is your experience and how do manage this taxwise?
Hope my questions are clear. Any help would be appreciated!
PS: not sure in which category this message should be. ▲ Collapse
| | | | | The office that issues the PO | Feb 2, 2023 |
Hi Karin,
You should invoice the office that issues your PO. They usually indicate which office you have to send your invoice to. It depends on the country in which this office is based how to proceed tax wise.
So it's not your choice.
Hope this helps
[Bijgewerkt op 2023-02-02 10:19 GMT]
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You must be referring to VAT, as all other taxes are due in the Netherlands, regardless of where the client is based.*
When you deliver translations to a VAT-registered entity in the EU's VAT area, the place of supply is the client's country, so VAT is due in the client's country. Hence, for such clients outside the NL, you don't charge VAT but validate the client's VAT number in the VIES system and mention it on your invoice together with an explanation such as 'Reverse VAT'.
... See more You must be referring to VAT, as all other taxes are due in the Netherlands, regardless of where the client is based.*
When you deliver translations to a VAT-registered entity in the EU's VAT area, the place of supply is the client's country, so VAT is due in the client's country. Hence, for such clients outside the NL, you don't charge VAT but validate the client's VAT number in the VIES system and mention it on your invoice together with an explanation such as 'Reverse VAT'.
For any client, consumer or business, outside the EU's VAT area, no VAT is due in the EU, again because of the place of supply is at the client's place.
Only for clients in the NL and non-VAT registered clients in the EU's VAT area should you charge VAT. No really that complicated.
*) Check that the client's country does not require withholding tax, which can be the case for e.g. Morocco and Taiwan, but if there is a so-called double-tax agreement that only gives the NL the right to tax, nothing should be withheld. ▲ Collapse
| | | | Samuel Murray
Netherlands
Local time: 22:54
Member (2006)
English to Afrikaans
+ ...
| Agree with Renée | Feb 2, 2023 |
Karin Renkema wrote:
Can you then for your own country take the closest one (for instance an Italy office) and have that count as the headquarters that you can take into account when doing your taxes? So that you can count the taxes for Europe for this company? Or does it not work that way?
I have clients that have offices in the Netherlands (my own country) as well as in other countries (in the EU and outside the EU), so I have to decide which office counts as the country of the client (as it affects how much tax I have to charge and when/where I should submit my tax returns). I eventually settled on Renée's method: the PO (purchase order) usually contains an address of the accounting office. That is the address that I use.
So, if a client has an office in the US and in e.g. Germany, but both send me a PO with the US address on it, I treat both clients as "US clients". If the German branch sends me the PO with a German address, then I treat the German office as a separate client. If you don't have this PO, send an email to their accountant and ask what address you should put on the invoice.
The country where a client makes payment from may not necessarily be the "country of the client". Some of my EU clients make payment via Dubai, but I still treat them as EU clients, especially since they have VAT numbers.
It's not always clear cut, but this method used by Renée works most of the time.
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Samuel Murray
Netherlands
Local time: 22:54
Member (2006)
English to Afrikaans
+ ...
Yes, but the OP's question relates to cases where the client has more than one office, and two of those offices are in two different tax zones.
Thomas T. Frost wrote:
Only for clients in the NL and non-VAT registered clients in the EU's VAT area should you charge VAT. No really that complicated.
It gets complicated when you submit your quarterly VAT returns. If the country of the client is in the EU, you have to declare the income during your VAT returns and make an ICP declaration separately; if the country of the client is outside the EU, you don't declare the income during your VAT returns. So this makes it rather necessary to be able to determine *where* the client is.
[Edited at 2023-02-02 11:32 GMT]
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Yes, but the OP's worry was primarily that it might be difficult to handle clients outside the EU, and it isn't, so we should just bill to the entity the client asks us to bill to when they have more than one entity.
Yes, VAT and other tax declarations need to be done correctly. If we don't really understand what to do taxwise, an accountant would probably be a good idea.
| | | | RobinB
United States
Local time: 15:54
German to English
| Invoice outside EU = no VAT | Feb 2, 2023 |
That's the standard rule. It doesn't matter where the order actually came from, it's the destination of the invoice that counts. So, if you're issuing your invoice to an entity outside the EU, you don't charge VAT on the invoice, and regimes such as "reverse charge mechanism" don't apply.
The only exception I'm aware of is invoices issued to non-VAT registered customers in the UK, for example retail clients and many (or even most) government agencies, to which you have to charge UK ... See more That's the standard rule. It doesn't matter where the order actually came from, it's the destination of the invoice that counts. So, if you're issuing your invoice to an entity outside the EU, you don't charge VAT on the invoice, and regimes such as "reverse charge mechanism" don't apply.
The only exception I'm aware of is invoices issued to non-VAT registered customers in the UK, for example retail clients and many (or even most) government agencies, to which you have to charge UK VAT and remit the VAT to HMRC in the UK (you must first register with them). ▲ Collapse
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RobinB
United States
Local time: 15:54
German to English
| Countries v. territories | Feb 4, 2023 |
EU VAT applies to all EU member states (without exception).
It does not necessarily apply to the "territories" of EU member states, as shown in the list. But they're not EU member states as such.
| | | | | Not without exception | Feb 4, 2023 |
RobinB wrote:
EU VAT applies to all EU member states (without exception).
It does not necessarily apply to the "territories" of EU member states, as shown in the list. But they're not EU member states as such.
That's not quite the right way of saying it. EU VAT applies to all EU Member States, but not to all parts of them.
Paris is not an EU Member State either, but it is still a part of the EU, just like Guadeloupe and Martinique. The territories listed as 'related to EU countries' are in fact parts of these EU countries, just with varying legislation and status. Greenland and the Faroe Islands are a part of Denmark, for example, but not of the EU in any sense.
Then there is Monaco, not an EU Member State, but EU VAT nevertheless applies, and Northern Ireland has a very complicated status after Brexit, but it doesn't affect services.
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