A tax registration threshold is a fixed amount at which a business must register and start collecting taxes in a country. We wrote about this in detail on our blog here.
A country (or even province or state) can have a sales tax registration threshold. The good news is Quaderno automatically notifies you when you reach a sales tax registration threshold. You can also keep track in the thresholds report.
The following applies to foreign sellers of digital goods. We always recommend checking with your tax advisor if your product falls under a special category.
Note: It’s your responsibility to consult with local tax authorities or a tax professional to verify that you charge your customers the correct tax rates, and to ensure you file and remit your taxes correctly.
Countries with no threshold
Yes, there are some countries with no sales threshold! This means that even if you have just one sale in one of these countries, you may be expected to register, collect, and remit tax to the appropriate authorities in that country. Quaderno will automatically notify you when you make your first sale to one of these countries. These countries are:
- Costa Rica
- Saudi Arabia
- South Korea
- All EU countries
Countries with thresholds based on local sales
In some countries, you are expected to collect tax only once you reach a specified sales threshold. The threshold is based on local sales. For example, if you sell AUD $75,000 to customers in Australia, you may be expected to register and start collecting tax in Australia. These countries are:
- Australia: A$75,000
- Bangladesh: BDT 30,000,000
- Cameroon: XAF 50 million
- Iceland: ISK 2,000,000
- Indonesia: IDR 600.000.000
- Japan: JPY 10,000,000
- Malaysia: MYR 500,000
- New Zealand: NZD $60,000
- Nigeria: NGN 25.000.000
- Norway: NOK 50,000
- Philippines: PHP 3.000.000
- Singapore: SGD 1,000,000
- South Africa: ZAR 1,000,000
- Taiwan: NTD 480,000
Countries with thresholds based on global sales
In some countries, you may be expected to collect tax only once you reach a specified sales threshold based on global sales.
So far only Switzerland has this kind of threshold: CHF 100,000 in global sales.