AdMob and VAT

Hello, I have a question to EU developers.
I want to add AdMob to my android application. According to tax lows of Czech Republic I have to become the VAT payer, because I receive a payments from EU VAT payer, but I am not and don’t want to be a VAT payer.
Let me know if I can pay taxes without having to open an VAT number?

If and how you have to pay taxes is a concern of your country.

admob is not EU, so VAT does not matter, you only need to pay taxes on your income but that’s your job, admob doesn’t care for that

Well im no expert on this matter, and I do not yet have paid apps.
But as far as my knowledge go’s in my country you will have to get a so called VAT number. But if you stay under a specific amount you may only pay income tax. But I do not know how the rules are in your country. I would recommend that you contact your tax department and explain the situation. Its not a good idea to just do whatever you want to do because you can get big fines for tax fraude.

As I told the VAT (Value Added Tax) doesn’t matter. You do not sell anything - you get paid by admob - else you have to have presenting recipes to admob :slight_smile:

You should ask specific tax things your tax bureau or someone who knows the tax law in your country - maybe you have luck and here is someone from czech or knows the czech tax law.

Im sorry I think you are right. I was confusing sold apps through Play. Admob is ads only and I think you are correct that it will only count as income tax.

From Admob > Account > Payment Details section:

Tax Information :
AdMob is required to collect tax information from all its publishers - you are responsible for keeping it up to date. You can change your tax information at any time.

Local tax ID:
Your local tax ID is the number the tax authority in your country uses to identify tax payers. For example, in the EU, VAT number is a tax ID. AdMob uses industry standard technology to protect the tax information that you send us.

that field is optional … as long as you pay your tax in your countries (and you are not an US citizen g) you should be fine

You are wrong, indeed. You are selling Admob a SERVICE, that’s why you get paid. It is exactly the same case as if you put an ad in your own car for a fee as some taxy drivers does. And services does pay VAT.

In Spain the things are really complicated. In a general case you there is no VAT charge for selling electronic services to a company outside Spain even when you works from Spain -it is treated as an exportation-, BUT if the service is exploited in Spain, then you must pay VAT.

In other words: you should pay VAT for the income made with ads published within Spain.

This is a holy crap, since there is no straight manner to know that geographic information. In my Admob account I only know which income is from the whole Europe, and I even have a few from “Unknown” source.

And the worst thing is that Admob will not pay that VAT, although they should -VAT is intended to be payed by the buyer, not by the seller- but the taxes authorities will prosecute you instead of Admob if you do not pay it.

I am considering to translate my financial activity to Gibraltar, Liechstein, or some other country like those that have more companies and banks than inhabitants…

If you were selling a service to admob, you would have to send them a recipe - which is not needed by admob. So YOU get something from admob YOU are customer, so you do not have to pay tax … but wait - you have to declare vat by yourself … but that’s holy complicated (as you know) for a non-business-man

VAT law for spain is changing in january … to be more clear, VAT law for europe is going to change … but I lack very detailled information about it at the moment.

Whatever it is such ridicolous to force small devs concentrating on VAT law or force them to pay someone 50 euro per month just to make everything right with tax.

And just because all of this, I will also made up a business outside europe (legally) just to not fu… around with that tax-idiots - much easier to just tax your foreign income - highly recommended

Currently I am in the process of opening up a new business over here in spain, and that is really ridicolous what those clowns does want from you - expensive and complicated like hell, somehow they deserve to have budget problems

by the way: VAT is the worst thing in current century - I wonder that it was ever accepted by people

I think that you need to pay VAT only and only if you selling apps (because app is some sort of goods) but if you give your app for “free” (no price tag but there can be ads or some other type of advertisement) then you paying just a tax on income and even that depends on how much money you earn because some countries have a threshold.

in europe there is a distinct difference in selling a boxed app and selling a download - it’s (sadly) not that easy.

in the case of admob I would be interested, what a lawyer is talking about that specific topic … I do not sell ad-space to admob, I give them only permission to use the ad-space (if you like) - and I’ll get a commission. not sure, where there should be a VAT… … for me the commission is income . point - i do not have to collect VAT for income . and for me it doesn’t matter if admob has to pay VAT (don’t think so, it’s export)

Selling apps - you HAVE to pay VAT and it’s complicated (I pay VAT for everything but some people in my country only pay for sells to EU countries - I think I’m on the safe side although if I sell a game for $2 I’m left with only $1 after paying taxes).

Admob - definitely no VAT! You are doing work (selling ad-space - giving permission to use ad-space is selling it) for a company outside EU - you don’t need to pay VAT for that and it doesn’t matter if they also show ads in your country beacuse you are selling the ad-space to them - a country outside EU - not to the people that use your application and view ads.

This is for Poland but should be the same for all EU countires. And it is certain - because my accountant says so. :wink: (also other developers in Poland I know do it the same way)

“If you were selling a service to admob, you would have to send them a recipe”

That’s a logical fallacy, indeed.

“So YOU get something from admob YOU are customer”

The point is that you get MONEY from Admob, and usually customers changes their money for goods or services, not the other way.

You are a customer when YOU PAY Admob for putting your ads into other’s apps. But when THEY PAY you for putting their ads into your app, they are the customers.

The law is very intricate. Even my tax accountant has problems understanding it, so I have asked an specialized lawyer for a second opinion this afternoon. I hope to get an answer in some hours.

I know some ad networks where you have to send them a recipe before you get anything paid. :slight_smile:

With admob it’s the same like amazon and all other affiliates you get paid by commission - not by providing any service … look at it this way: admob was not coming to you ordering ad-space.

They offer you comission when you display their(!) ads - in the end you get the commission (like it is with every other affiliate too)

I do not know Poland’s VAT law, but I do Spanish one and definitively that’s not the case of Spain. Here there is a clause that says that even when the customer is a company outside the UE, if the service is exploited in Spain, then VAT must be charged.

So according to this law, the revenue for those Admob ads shown within Spanish frontiers must be charged with VAT, while the ads shown in other countries not.

This drive us into several problems. The most important is that AFAIK Admob’s geo stats aren’t so specific to know which part of your revenue comes from Spain, so you have no manner to know which part of your income should be charged with VAT.

The advertiser does pay admob - not you - so it is solely the problem of admob to do any VAT-calculations. You even have no contact with the advertisers, and they do not pay you, they pay admob - and admob does pay you a commission (which is income, no VAT, no IVA).

Yes you are. At least in Spain when the receptor of the good or service is an individual, VAT must be charged in any case, regardless of their location.

Yeah, whatever you say…

excerpt from admob:

If User is a publisher, User shall receive a percentage of the Net Revenue of Advertisements associated with User’s use of the Services as solely determined by Company

ask your tax man if that is or is not a comission like payment … send greets

Did you ever read about Dunning-Kruger effect?

Please I am loosing my mind.
I have a six figure pending in admob that I need to bring to my bank account as soon as possible.
but I wanna do everything right.

The main question that I never find answer for is that if I must pay vat or “iva in spanish”.
I live in europe and the payment will be comming from google ireland.
my adsense account is stating that I have personal account.

I read a lot in the internet and there is so many different stories that does not make any sense.
We are talking about six number figure I don’t want any problems with the tax office.

please help.
any spanish resident here having the same issue ???