I was wondering if I could get some help here. I’ve been getting more information lately, and honestly, I’m feeling a bit stuck on how to handle this. Here’s the situation: - I have an LLC set up here in the US (and I have a VAT ID number) - My client is based over in the United Kingdom (they also have a VAT number) - The work I do is service-based—specifically, I’m a programmer. To give you a better idea, I develop and maintain software for their hardware. They aren't actually the end users of my service. It’s kind of like they manufacture smartphones, and I build the operating system that runs on them before they sell the finished product.
Since I'm still pretty new to all this, I’m curious about what exactly needs to be listed on my invoice. For instance, if we agreed that my services would cost £1,000, am I understanding this correctly? Should I list $1,250 on the invoice (that's the £1,000 plus 25% for our local sales tax), show the amount in both USD and GBP, and then include that "reverse charge" note on the bill (something like Exempted from VAT pursuant to art. 17. par. 1. of the US Value Added Tax Act. – Reverse charge)? And by doing that, will they be able to claim a credit for the tax paid?
Thanks so much for any insight you can share.
You've got two things clashing here because you can't both charge sales tax yourself and use the reverse charge method at the same time. If you go with reverse charge (meaning you include that specific legal note), you're basically shifting the tax responsibility over to the buyer, so you don't charge any US sales tax on the invoice! You just list the $1,000 price and that little note you mentioned. The big assumption here is that their tax ID is valid in the VAT registration database.
You'll also need to make sure you record this properly on your tax filings for the IRS.
The client will (hopefully 😬) handle sending the right paperwork over in the UK. They might have to pay UK taxes there, or maybe not (it depends on whether they're actually in the local tax system or not). But honestly, that's not your problem to worry about.
neonsurfer13 said:Just one more thing... I’ve set up my web shops so they look like two completely separate business locations. But honestly, they’re both just virtual storefronts, not two actual brick-and-mortar shops at different addresses. How do I handle this? I haven't actually registered a business location through the IRS portal for tax purposes yet, so I'm not sure what my options are here. Since the first web shop is still running through my main transactional account, I don't need to register it separately. For the second shop, how am I supposed to report the business location?
You shouldn't run into any issues. You only need to register the shop that actually processes cash or credit cards. When you're setting it up, just select "online store" as the type of business location. Got some brand new instructions from yesterday
I'm having the same issue on Chrome where the address bar menu just won't show up. On Edge, it’s hit or miss—it works for some clients but totally flakes out on others... I'm guessing they haven't quite finished ironing out all the kinks yet.
I just updated someone's status at Medicare: they went from contract to permanent. Do I need to report anything to Medicare about this? I'm looking at the T1 right now and honestly can't find where to log this change 🤔
I’ve been checking the codes on the T1 for everyone else, and they all show 101/001 regardless of whether they're temp or full-time. Help me out, I am totally stuck today 😁
Anyone here dealt with Puerto Rico before? 😬 Puerto Rico is a bit of a weird one—it’s part of the US, but the tax rules aren't exactly the same. From what I can tell, they don't really have a standard sales tax setup like we do, and a lot of other taxes just don't apply there. Because of that, companies over there don't necessarily need an IRS EIN. I've got an invoice from a vendor in Puerto Rico for some services, and honestly, I'm totally lost on how to book this in my books 🤔 If I list it under foreign services, the system automatically calculates the tax liability and the credit, but that feels totally wrong since the vendor can't even apply a reverse charge if they don't deal with sales tax. Plus, they aren't showing up in the IRS database.
I was just about to jump on here and vent about City Hall! Seriously, I was teaching a class on client management about two weeks ago, and everything was running perfectly fine with those 2017 rate reductions applied. So, what on earth were they doing messing around with the system all of a sudden? 😠
edit: I just saw some posts in a Facebook group too—turns out the forms are going through if the income is under $500k, but once you hit the higher brackets, everything just breaks.
Ugh, tell me about it. They told us we had to clear the digital certificates from our computers and all that nonsense, too. We tried it a bunch of times, but nope—still nothing works. Since we handle so many enrollments and cancellations, and not everyone has power of attorney for every single client, we end up having to run down to Medicare just to get them to print out 😵 . We finally filed an official grievance with the regional Medicare headquarters in the city, because before this, we were just going back and forth with some IT department out in Des Moines or somewhere similar, trying to convince them that our hardware wasn't the problem. It’s funny how everything works perfectly fine for every other agency, though!
Steven Anderson14 said:What’s the move when it keeps telling me my PIN is wrong or my card expired? Everything else works fine, it's just this Medicare site. I can't even get past the login screen.🙂
Don't even get me started! We’ve been dealing with a handful of digital certificates on our servers, and we've been stuck with these exact same issues for over a year now. Everything works perfectly fine except for Medicare. The rest of the systems are running smooth as silk. We've tried everything—calling Medicare, emailing a dozen different people, even showing up at their office in person to settle things—but still nothing. No fix, no solution, just dead ends. 🙄
So if there’s no sales tax because it’s exempt by default (not even a reverse charge situation), I wouldn't even list it under received services in the EU system or include it in my tax filings.
I deal with something pretty similar—educational certificates that aren't subject to sales tax, neither on their end nor ours. Honestly, the institution issuing them doesn't even have a standard Tax ID, so I couldn't put them in the tax reports anyway. But even if I could, it feels wrong to try and calculate sales tax on something that isn't taxable to begin with. 🤔
All those IBM transactions with the zeros finally cleared for me late yesterday afternoon—even the ones that were stuck before. I was thinking about trying to push the rest through today, but I think I'll just hang tight until tomorrow. 😁
Just double-checking here, because honestly, I don't trust anyone anymore 🙂 If a "fresh" small business owner (not on a flat tax setup) gets some self-employment grants from the IRS ($8.25) like they did back in 2016, does that money count as taxable income? Like, does it actually get factored into their income tax calculation?
rowdybison3 said:I was wondering if I should be recording loans in the KPI book. When I'm logging income and expenses in Silicon Valley, there's an option to mark them as outside the KPI. Is that actually okay, or should I just leave them out entirely? And if they do need to be recorded, do they end up on the P-PPI form too?
That’s honestly the best way to play it. In Synesis, I'd just log those receipts as off KPI—mostly just so I can keep my own sanity and stay organized. Then, for the PPPI, you just pop them under field V.2.3 and attach the statements showing those loans alongside your PDoh and PPPI. Do that, and nobody's going to give you any grief about it. 🙂
Carol Price4 said:Calling all small business owners working in Silicon Valley...
DI procurement - $13, Section 22, it was depreciated $1047 and then we moved to Sales...
I've generated an invoice in the Sales module, but since the non-depreciated value didn't hit expenses, how do I handle the payment? If I try to enter the receipt via the payment table, everything just gets lumped into receipts...
Honestly, I think sales tax is driving me crazy this month—I must be missing something totally obvious. Please help! 🙂
I'm not 100% sure I follow what you're asking, 🙂 I'm guessing you don't want that non-depreciated portion showing up in your KPI bank receipts? Try checking the "outside KPI" box in the payments table—either for the whole thing or just that specific part of the invoice you want to keep separate from the bank deposits. That should mark the IRA as paid without dumping it into your KPI. If things still look wonky, you might need to tweak it manually in the Receipts document.
Nah, you don't put that under expenses. It’s actually the exact same type of tax; they just split it into two different codes because the annual difference might include stuff other than just your turnover obligations.
Thanks, I figured as much. On the T1, it just shows the main insurance categories—like if you're employed, unemployed, a dependent, and all that stuff... Actually, even better.
So, an employee's fixed-term contract is wrapping up, but they just signed on for a permanent role. Since they're under 30, we're looking at that payroll tax exemption. I already updated everything through the Census Bureau Online using the M-3P form. Do I need to do the same thing with Medicare & Medicaid Services? I'm looking at the T1 form right now and honestly, I can't find anywhere to even log this change 🤔