Taxing digital content

It has never been easier for businesses — particularly those selling digital content such as apps, e-books and music or film download — to find new customers and enter new markets.

Many businesses whose customers are located in their ‘home’ jurisdiction will give very little, if any, thought to tax questions such as ‘should I charge my customers VAT?’ or ‘where will my profits be taxed?’, but where business is transacted cross border these questions become much more important and, potentially, more difficult to answer. Neil McKnight, a senior associate in Taylor Wessing’s tax group, summarises some of the tax issues faced by businesses distributing content across borders…

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