Collecting location evidence
Sellers of digital products must collect and store the customer's location they have used to calculate the tax rate of each sale, in order to comply with tax legislation around the world.
Most countries accept the billing country, IP address, and bank country as valid evidence to determine customer location.
These pieces of information are called location evidence. Location evidence is required for digital product sales worldwide. Quaderno automatically collects and stores that evidence for you!
The number of location evidence you need to collect varies over the world (and over time). For instance, according to the latest EU VAT regulations:
- When you’re a small business in the EU with less than €100,000 in cross-border sales in the EU, you would only need to collect one piece of customer location evidence.
- However, non-EU sellers must always gather two non-contradictory pieces of evidence.
When available, Quaderno will register the following details to be used as evidence to determine customer location:
- The customer’s billing country.
- The IP address of the buyer’s device.
- The country that issued the customer’s card or bank account.
For the rare cases when necessary evidence for your sales cannot be automatically collected, or the evidence is contradictory, Quaderno will notify you and you'll need to contact your customer for extra evidence. Learn more in "managing location evidence conflicts".