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Old 09-14-2016, 11:09 AM
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Join Date: Sep 2016
Location: San Francisco
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[Help] US LLC bills German company for services in the US. What taxes???

Hey everyone,

I am a German expat living in California and I am pretty new to the tax laws here. I would really appreciate your input.

I need to write an invoice for an educational trip I organized recently and I am very much confused, what taxes I have to pay.

Some more background:
  • I organize educational trips for German executives here in California
  • The company I invoice for my service sits in Germany, my company is a LLC registered in California
  • My service is solely provided in California

From my understanding, I don't need to collect Sales Tax since my service is not a physical good. Now the next question is, if I have to pay VAT on this. I would assume not, since the service is provided only in California. I am so confused

Anyone who could help me out with that?

Thanks a lot.



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Old 09-15-2016, 05:44 AM
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Join Date: Oct 2010
Posts: 5,227
I need to write an invoice for an educational trip I organized recently and I am very much confused, what taxes I have to pay.

Some more background:
? I organize educational trips for German executives here in California
? The company I invoice for my service sits in Germany, my company is a LLC registered in California===. I assume your LLC is a SMLLC NOT MMLLC then, foreign sellers should know that having a physical presence, such as owing or leasing space in CA will create a sufficient connection for sales tax nexus to apply. Incidentally, many state sales tax laws specifically say that ?maintaining, occupying, or using, through a subsidiary or agent, an office, place or distribution, sales or sample room, warehouse, or storage point? in their state creates nexus.
? My service is solely provided in California

From my understanding, I don't need to collect Sales Tax since my service is not a physical good.=====>>>>>>>the bottom line is: aslongas your business sells a product or provides a service that is taxable, and as you are in CA state, a " sales tax" state, you will need to set up a process to collect and pay sales taxes and file sales tax returns periodically;ypu need to contact the CA state of Board of Equalization for more accurate info in detail; https://www.ftb.ca.gov/aboutFTB/cont...tility_Contact


Now the next question is, if I have to pay VAT on this. I would assume not, since the service is provided only in California. I am so confused ======>>>No VAT in US; the U.S. is the only country in the OECD, that has not adopted a VAT Value Added Tax is levied in every stage of the distribution chain, and impacts every possible transaction be it sales of goods, imports, supplies and purchases of services or licenses. Although the tax burden is on the final customer, the compliance risks are for the businesses in the supply chain.



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