Android: In app-billing VAT tax

Question

I have implemented In-app billing in my application, but have limited the in-app purchase function to a few countries/currencies, since I\'m note sure what my responsibilite

Answer 1

Google documentation here: VAT Guidelines

For any EU country plus Albania, Morocco, Norway and South Korea you don't have to report or deal with VAT currently but the rest is up to you unfortunately. I'm currently developing a paid app too and looked up on tax issues beforehand.

This is not an exact answer since rules about taxes can change overnight, also there are some controversial debates going on about how Google evades taxes but that is a discussion for another topic.

To give an example, for my country (Turkey) you have to prepare a report about your annual income amount if you are located here but even then some financial reporters claim that selling software is actually "renting" it so it cannot be taxed. My suggestion for you would be to update your billing strategy according to the link above and if any unwanted situation occurs oppose it with the given legal information.

Answer 2

In case of Japan and GooglePlay, you have to do the whole VAT procedure on your own if your income reaches a threshold of 10 million Yen (about 95 kUSD) per year, otherwise no action from your side required. If you make that much money you could probably pay a tax professional to deal with this.

Source: National Tax Agency JAPAN

No.6　Taxable Person Business which falls under either of the following categories is a “Taxable Person” who is required to file the final return.

(1) Businesses which had a taxable sales amounting to more than 10million yen during the Base Period (See following Figure A), ...