The dropshipping model, in any of its variants, is valid as long as your activity is limited to facilitate the online sale between the supplier and the customer, and it is the supplier who sends the product to the customer.
This implies that you do not have a physical office/warehouse, or manage stock, or import or export the physical product. In this scenario, the ideal situation is that your income is obtained as sales fees from the supplier.
Your company should act as a mere online sales facilitator.
You also have to keep in mind that, even without making the sale directly, if your business model is dropshipping or FBA of physical products, your business needs to obtain a VAT number and pay VAT in the countries of the European Union where your sales exceed a certain amount of income per year.
These payments and the corresponding reports must be carried out with the corresponding Tax Office of these countries, and that’s not included in our services, we can’t help you with that. You would have to look for accountants in each of these countries or providers offering that service such as Amazon Global VAT program.
We do support dropshipping and FBA companies. The main requisite is that the business model follows this “pure” dropshipping model:
- you DON’T import/export the goods
- the supplier/provider sends the goods directly to the customer
- you DON’T keep stock, buy or sell anything directly
- you don’t have a warehouse (except if the warehouse is in Estonia).
If your business complies with that, we can support your company. More information here.