Is Tax Included with My Monthly Plan?


Tax Rates
European Union Value Added Tax (VAT)


Gigabox Hosting currently collects Texas Sales & Use Tax and effective mid-January 2013, will begin collecting Value Added Tax (VAT) for the European Union (EU).



Why is tax included or not included with my purchase?

If you are outside of Texas or the European Union, then we are not required to collect tax (e.g. sales tax, use tax or VAT) on your account.

Texas: Any customers with a billing address in Texas will be required to pay a state sales tax on top of the initial invoice (currently 8.25%*). This does affect current customers and will be applied to recurring charges.

European Union: Starting January 2013, any customers with a billing address in the European Union will be required to pay the applicable VAT rate on top of the initial invoice.

The amount of sales tax or VAT added is indicated on your invoice, which can be viewed on your account

Keep in mind, all currency is in U.S. Dollars (USD).


Does Gigabox accept tax exempt numbers?

To be exempt from Texas Sales & Use Tax, we need the proper documentation proving tax exemption status.

For business tax exemption, we will require the appropriate form be completed and emailed or faxed back to us for verification.

Texas Sales & Use Tax Resale & Exemption Certificate Forms (PDF)

For non-profit organizations, we require a copy of your 501(c)3 certificate via email.

Please submit a ticket to our Billing department and attach the documents to supprot@gigaboxhosting.com


Does Gigabox accept VAT tax exemption numbers?

All VAT tax exemptions are handled through the VATIN itself. You would need to edit the account settings to the proper customer type (Individual [never exempt], Business or Charity) and enter the VATIN.

The amount of sales tax or VAT added is indicated on your invoice, which can be viewed on your account


Why do you collect sales tax from Texas residents and not from out-of-state residents?

According to United States Supreme Court decisions interpreting the U.S. Constitution, Gigabox is only required to collect taxes for states in which it physically operates. As such, Gigabox is not required to collect sales & use tax or value added tax (VAT) for states and countries it does not reside in.


Why does Gigabox Hosting, LLC collect sales tax from European Union residents and not from other countries?

As a non-European Union supplier of web hosting services to customers in the European Union, Gigabox is required to comply with the European VAT (Value Added Tax) regulations and charge VAT to customers located in the European Union.

For more information on whether this applies to you, please read our article on: European Union Value Added Tax (VAT)


What about other countries?

For jurisdictions that Gigabox does not collect sales & use tax or VAT for, it is the responsibility of the purchaser to pay any sales & use tax or VAT due, if any. Some jurisdictions require the purchaser to pay a use tax or VAT directly to the state when purchasing from any out-of-state vendors in certain circumstances (i.e. in some jurisdictions, the tax is still due, but Gigabox is not required to collect it). Please consult your accountant or government tax office for specific advice.


Data Processing Tax Rate in Texas

The Texas state sales tax is currently 6.25%. In addition to the state sales tax, Gigabox is also required to charge a 2% local sales tax rate. The 8.25% sales tax rate is imposed on web hosting services, which is considered a "data processing service." Data processing services have been deemed to be taxable services under Texas law, however, 20% of the value of data processing services are exempt. Therefore, only 80% of the web hosting purchase price is subject to the Texas state and local sales tax.


References


State of Texas

If you are curious or just want to hear it directly from the taxing authority, here are some links to the Texas Comptroller of Public Accounts website which will give you a greater understanding of the law.

Internet Orders - Buying and Selling

Taxable Services (PDF)

If you do business, or plan on doing business in Texas, this is recommended reading.


European Union

For Europe, check out the European Commission Taxation and Customs Union website which explains Value Added Tax (VAT).

VAT and Business

VAT on Electronic Services

If you do business in Europe or have European customers, it is recommended you become familiar with the customers country laws.

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