How RecordFlower calculates the VAT on your orders

If your business is established in the EU, RecordFlower calculates the VAT on every order automatically. You do not need to maintain a rate table or know any tax jargon. Here is how it works.

Three things decide the rate

The rate depends on three factors: the VAT regime you have set for an item, your buyer's country, and the registrations you have on file. We read the rates directly from the European Commission's database ourselves, so you never have to update them by hand when a country changes its rate.

Established outside the EU?

Then RecordFlower does not calculate anything for you; that role stays with Stripe Tax, which you activate and manage yourself in your Stripe dashboard. The rest of this article covers sellers established in the EU.

Domestic sales and sales within the EU

Selling within your own country, your own rate applies. Shipping to another EU country while staying under ten thousand euros a year in those sales, your own rate still applies. Above that threshold and registered for the One Stop Shop (OSS), your buyer's country rate applies instead. You then remit the VAT for all those countries through a single return with your own tax authority, which forwards the amount.

Sales outside the EU

Shipping to a country outside the EU is an export. No VAT is charged, and your buyer pays import VAT on arrival. Your invoice states this too, with the legal reference alongside it.

Selling to consumers in the United Kingdom has its own threshold, and you need to register with the UK tax authority. We do not block that sale, but we let you know once it applies.

Territories with their own VAT regime

Some territories belong to an EU country but fall outside the EU VAT area: the Canary Islands, Ceuta, Melilla, Åland, Livigno, and a few others. We recognize them by postcode and treat them as an export, even when the country on the shipping label looks like an EU one.

Where your settings come from

When you set up your shop, we ask you a few questions about your business: whether you mainly sell second-hand, whether you ship to other EU countries, and if so, how much. We derive your settings from that, and your dashboard shows what we worked out. If something is wrong, you correct it there.

Selling a mix?

Does part of your inventory differ from your default regime? If you mostly sell second-hand but occasionally new items with VAT on the purchase invoice, set that per item on the Tax page in your dashboard. That rule then applies to that specific item, regardless of your default regime.

Is your default regime no longer correct? Run through the questionnaire again from the same page. Your earlier answers stay visible as a starting point, and nothing is saved until you confirm the new answers.

What we do not do

We check VAT numbers for their shape, not their existence, and we never reverse-charge VAT to business buyers. The calculation itself costs you nothing extra: RecordFlower charges no per-order transaction fees, and VAT calculation is included in your subscription.

What this means for you

You do not need to maintain a rate table or track thresholds yourself for the calculation. Filing and remitting remain your responsibility as a seller. Unsure about your specific situation? Consult your accountant or tax advisor.