What started as a small issue when purchasing a RW8 upgrade has significant implications for anyone who has implemented a Paddle payment system for a UK business
This relates to any UK business where VAT is involved. Paddle is charging VAT on UK Pound (GBP) transactions (as you might expect), but providing an Irish (Eire) VAT number which is Incorrect. UK businesses cannot reclaim VAT from an Irish VAT number. I am not a VAT or Tax expert, but I have several experiences with this problem in the past.
For purchases that are virtual (licences / software), the UK registered business enters a GB VAT number and the VAT is removed from the transaction under the EU regulations.
For example. buying the RW 8 upgrade, the process should be that I enter my GB (or other EU VAT number) and Paddle then charges the net figure. In fact they (incorrectly) charge the price including vat because their location for charging (and their vat number) is the Republic of Ireland.
It may be worth being aware of this for your customers who are using Paddle.