Quaderno has a full PayPal integration that takes automating billing to the next level! So you can connect your PayPal and Quaderno accounts seamlessly, and Quaderno will automatically create and send tax invoices to your buyers.
Of course, that’s convenient, and that’s great. But there’s something even more important. Quaderno also ensures complete EU VAT compliance for PayPal.
That means if you have customers anywhere in the EU, you can automatically comply with the tax laws of 28 different countries.
Theoretically, the EU has one sales tax law: you must charge VAT at the rate of the buyer’s home country.
But, see, the EU doesn’t have one VAT rate. Far from it! Since most EU countries have their own specific VAT rate, and some even have different VAT rates for different products, there are potentially 75 VAT rates. And you have to be ready to charge all of them if you sell a product (including software, ebooks, and more) to a customer inside the EU.
That’s not even the toughest part.
Because of EU data protection rules, you have to keep data on your customers, information that proves where they’re based. (Unfortunately their word isn’t enough, or everyone would just say a tax-free location like Luxembourg!) You hold on to that data for 10 years. At the end of each quarter, you send out a VAT statement to each EU country where you sold to a customer, then pay each statement.
Since that’s a crushing burden that many SMBs don’t have the hardware or the staff for, many business owners find automatic solutions to take care of the EU VAT process for them.
Yeah, it’s a relief knowing you can just use PayPal and everything behind the scenes will be taken care of. Invoicing? We do that. Refunds? We send your customer a credit note automatically.
But what we’re most proud of is that a Quaderno customer can comply with VAT all across the EU, simply and easily. And when it comes time to file your VAT return, Quaderno provides you with an easy-to-read tax report at the click of a button.
Here’s how to get started.
Connect Quaderno with your PayPal account
First, link your PayPal and Quaderno accounts. It's a really simple OAuth process. Just follow these steps:
- In your Quaderno account, go to the integrations page and select Paypal.
- Quaderno will ask for your permission to connect to your Paypal account.
- Grant permission and that’s it!
Set up Quaderno’s VAT compliance with your PayPal account
There are a couple more steps involved to set up the VAT compliance element, but not much! If you think of all the time it will save you in the long run — day to day and especially at the end of each quarter — it’s definitely worth it.
Start by going to the Custom variable of your PayPal payment form.
Here you can insert the appropriate serialized IP address. Quaderno will automatically track the IP address location to ensure it matches your customer’s given postal address. That’s how we verify the VAT rates are always accurate.
For more detailed information about completing this step, read on about how to customize your Quaderno and PayPal integration.
Note: At Quaderno we love providing helpful information and best practices about taxes, but we are not certified tax advisors. For further help, or if you are ever in doubt, please consult a professional tax advisor or the Tax Agency.