Sell handmade jewelry on Etsy
Sell handmade jewelry on Etsy
Question:
Hello!
I would like to open an online shop on the Etsy platform and sell my handmade jewelry. Delivery will be at the recipient's expense. Sales will be made only in the USA, as the goods will be sent from Bulgaria. I plan to open a company and register under Art. 97a. My question is related to VAT reporting.
1. Do I owe VAT on US-only online sales before I reach a certain threshold?
2. What documents do I need to properly report to the National Revenue Agency?
3. Do I have to report every month or every 3 months?
Thanks in advance!
Answer:
Hello,
Directly to your questions:
1. "Do I owe VAT on US-only online sales before I reach a certain threshold?" - you don't owe VAT on your sales. VAT due will be paid by the final recipient in accordance with US tax laws. You will owe VAT on the value of the services received from companies established outside Bulgaria (for example, on the value of the Etsy commission invoice).
2. "What documents do I need to properly report to the National Revenue Agency?" - All documents related to your activity - invoices for purchases made, if you purchase materials/goods outside of Bulgaria and documents proving the transport of these materials/ merchandise, Etsy sales reports, bank statements. On the basis of these documents, the necessary declarations are prepared, which are submitted to the National Revenue Agency in order to report the company's activities.
3. "Do I have to report every month or every 3 months?" - as a VAT-registered company, you will have the following reporting obligations:
- VAT declarations - every month by the 14th, a VAT declaration is submitted for all purchases and sales made for the previous month. If no purchases or sales have been made, a zero VAT return is submitted.
- declaration form 1, declaration form 6 - every month by the 25th, declaration form 1 and declaration form 6 must be submitted for each person insured through your company for the previous month. In the most general case, if there is no reason on which you are exempted from insurance, you will have to submit a form 1 declaration for you on a monthly basis. If you have employees on an employment contract, form 1 and form 6 will have to be submitted for them. If only you will self-insure through the company, in addition to the monthly declarations form 1, you must also submit an annual declaration by April 30 of each year sample 6.
- Annual financial report - every year by June 30, the annual financial report of the company is submitted to the National Statistical Institute, and by September 30 it is also submitted to the Trade Register.
- Annual tax return - every year by June 30, you must submit an annual tax return to the National Revenue Agency, which determines the annual tax payable on the realized profit.
These are your most basic obligations to the Institutions in Bulgaria. Depending on whether you have staff, whether you reach certain revenue turnovers or certain profit amounts, whether you fall into the samples of the National Statistical Institute, it is possible that additional commitments may arise with different periodicities.
We hope we have been helpful!
Greetings!
