VAT Charges Explained

At SimplySim, we aim to be transparent about how Value Added Tax (VAT) is applied to our eSIM products and services. This policy explains how VAT is charged for both Business-to-Consumer (B2C) and Business-to-Business (B2B) transactions in the UK, the European Union (EU), and globally.

We are a UK-based company, and our VAT obligations are determined by UK law and relevant international rules for digital telecommunications services. The place of supply for eSIMs (digital telecom services) generally depends on the location of the customer, especially for B2C transactions.

• UK B2C Sales:
  • If you are a consumer located in the UK, we charge UK VAT on our eSIM services at the prevailing rate, provided we are VAT-registered.
  • We are required to register for VAT if our annual taxable turnover exceeds the UK threshold (currently £85,000, subject to change) or if we opt for voluntary registration.
• UK B2B Sales:
  • If you are a UK-registered business (and we are VAT-registered), we charge UK VAT unless a specific exemption or zero-rating applies.
  • Businesses that are VAT-registered can typically reclaim this VAT through their periodic VAT returns, subject to HMRC rules.

Since the UK is no longer part of the EU, different rules apply to EU customers based on whether they are consumers (B2C) or businesses (B2B).

• EU B2C Sales:
  • For digital telecommunications services provided to private individuals in the EU, the place of supply is generally the customer’s location. This means we may need to charge local VAT at the rate applicable in the EU country where the consumer resides.
  • We handle these obligations through the non-Union One Stop Shop (OSS) scheme or by registering in each EU member state where we have customers.
• EU B2B Sales:
  • If you are an EU business with a valid VAT number, the transaction is typically zero-rated for UK VAT purposes, and the reverse charge mechanism applies in your own EU country. We do not charge UK or local VAT, and you self-account for VAT in your local VAT return.
  • You must provide a valid VAT ID for the reverse charge to apply. Otherwise, we treat you as a B2C customer.

• Non-EU, Non-UK B2C Sales:
  • In most cases, UK VAT does not apply if you are a consumer outside the UK and the EU. However, some countries require foreign businesses to register and charge local sales tax or GST on digital services if certain thresholds or nexus rules are met.
  • We will comply with local tax laws where required. If local taxes apply, these may be included in the price or added at checkout, depending on local regulations.
• Non-EU, Non-UK B2B Sales:
  • Generally, no UK VAT is charged if you are a business located outside the UK and EU, unless we have established a local tax presence in your country. You may need to self-account for any local taxes under your jurisdiction’s reverse charge or similar mechanism.

• Invoices: We provide invoices or receipts that clearly display the VAT rate and amount (if applicable), along with our VAT registration number.
• Customer Classification: We may request additional information (e.g., VAT ID for EU B2B) to determine the correct VAT treatment. If you cannot provide a valid VAT ID, we must treat the transaction as B2C.

VAT rules and rates are subject to change based on legislative or regulatory updates in the UK, EU, or other jurisdictions. We monitor these changes and update our practices accordingly. Any changes to how we charge VAT will be reflected in our Terms and Conditions or on our website.

If you have questions about how VAT applies to your purchase, please contact our customer support team or consult a tax professional. We are happy to provide additional information about our VAT registration status and how we handle cross-border transactions.

Disclaimer: This policy is provided for informational purposes only and does not constitute legal or tax advice. VAT and sales tax rules can be complex and may vary depending on your individual circumstances. We recommend consulting a qualified tax advisor or accountant to ensure compliance with all applicable laws.

Frequently Asked Questions (FAQs)

• How do you handle VAT for EU consumers?

  For EU consumers (B2C), the place of supply is generally where the customer is located. This means we may charge local VAT at the rate of the EU country where you reside. We manage this through the non-Union One Stop Shop (OSS) scheme or by registering in each relevant EU member state.

• What if I'm an EU business with a valid VAT ID?

  If you are an EU business with a valid VAT ID, we typically zero-rate the sale for UK VAT purposes, and you must self-account for VAT in your local VAT return using the reverse charge mechanism. You must provide a valid VAT ID to qualify for this treatment; otherwise, we treat you as a B2C customer.

• Do I pay UK VAT if I'm located outside the EU and UK?

  If you are a consumer outside the UK and EU, UK VAT usually does not apply. However, some countries require foreign businesses to register for local taxes. We comply with local rules where necessary, which may result in additional taxes or fees. For B2B transactions, no UK VAT is typically charged unless we have a tax presence in your country.