Madeira - Digitalised Services

Digitalised services are services or goods that can be delivered (not just purchased) via an electronic link, such as the Internet or digital television. Under a European Union Directive, sales of electronically delivered services must charge VAT, taking into account the location of the customer, but at the local rate of the vendor. If the customer is within the European Union, the vendor must charge VAT on the digitalised service at the vendor’s local standard rate. If the vendor itself is not within the European Union it must register in one of the member states.

The Directive confirms the following list of electronically delivered services as being affected by the ruling:

• Website supply
• Web hosting
• Distance maintenance of programs and equipment
• Supply of software and updating of programs
• Supply of images
• Tests and information and the provision of access to databases
• Supply of music
• Films and games, including games of chance and gambling games
• Supply of political, cultural, artistic, sporting, scientific, entertainment broadcasting events
• Provision of distance teaching

Examples of services would include services from an Internet service provider, supply of information delivered over the Internet or pay television channels.