A Letter to our Transport Evolved Subscribers

Dear Transport Evolved Supporter,

First, let me apologise for writing to you in such an informal way. You’ll note that this email is something of a mail-dump and as such, it isn’t particularly personal. As founder and co-host of Transport Evolved, I would prefer to interact with you all personally. However, as I’m about to detail below, circumstances dictate that I use this particular, less personal form of communication.

I’m writing to you today because you’re one of the individuals who has visited the transport Evolved site, subscribed to our show, and decided to make a monthly free-will donation to help keep the show running, the lights on, and the server happy.

Over the past year or so, your kind donations have helped us to invest in the hardware and software that we use to produce the show. You’ve helped fund continuing server bandwidth. And you’ve helped those of us at Transport Evolved know that the content we produce is welcomed and loved.

And it’s your donations that have helped us keep running through some tough times, helped us come out the other side, and sign some of our first ever official targeted show sponsors, who we’re delighted to be working with.

After many years of long hours, zero salary and hard graft, our network is gaining momentum and voice in the world. And it’s thanks to you that this has been possible.

However, as you may have noticed, we’ve just had to cancel all of the reader sponsorships with immediate effect, something that we’re not happy about and something that we wish we didn’t have to do. But with new rules coming into force across Europe concerning the sale of digital goods and services, we’re having to cease any direct transitions between ourselves and our customers, at least for the time being.

On January 1st 2015, new rules come into effect that will make it mandatory for Value Added Tax (a Europe-wide sales tax) to be levied against any online purchase made by an EU resident, wherever in the EU they live.

Since anyone in the EU can freely trade with anyone else in the EU, and the actual level of VAT due is different in each country, a rather complex new tax system has been devised in which businesses who sell online digital goods and services directly to their customers will have to ensure that customers pay the correct VAT dependent on where they live.

To simplify things, there’s a new single system which businesses can use — called VAT MOSS — in which the business pays VAT MOSS all and any taxes due on customer purchases made throughout the EU and then the VAT MOSS system splits up the tax due to each country and pays that on the businesses’ behalf.

In order to use that system however, the onus is on the business not the customer to prove that each customer is a resident of whichever member country they happen to live in, is being charged the correct VAT for that country, and has paid that VAT to the business at point of sale.

And for anyone who takes online payment for online goods and services, that means collecting and keeping documentary evidence for ten years on each and every customer who uses the system.

By now, you may be feeling a little confused, especially if you’re outside of the EU and you haven’t heard about VAT MOSS before. And you may be wondering why, as a support of Transport Evolved who lives OUTSIDE of the EU, you’re affected.

Under the new regulations — which I should point out HM Revenue & Customs are still trying to sort out less than a month after they come into effect — the businesses have to prove that customers who are OUTSIDE of the EU are actually OUTSIDE of the EU.

So even if we continue to take donations from non EU supporters, we’d have to carry out a heck of a lot of extra paperwork to prove that. Furthermore, the regulations are concerned with where the customer IS, not where the business is. If, as we’re planning, Little Collie Ltd (Who owns Transport Evolved and does other stuff as well as the site you know and love) heads to the U.S. next year and becomes a LLC, these rules would still apply to any EU customers.

It’s all a bit of a shambles. It was a law originally designed to ensure that big companies like Google and Amazon pay the correct tax due in each and every country they trade in. When the regulation was originally written and agreed on, those writing the legislation didn’t think of the impact it would have on small businesses.

As I write this, lobbyists, accountants, small businesses and politicians are trying to figure out a better way of enforcing VAT MOSS. At the moment however, the advice we’re getting from our accountants is to cease receiving all donations from January 1.

That’s because Transport Evolved comes under the ‘broadcasting’ banner of VAT MOSS and even though we’re not ‘selling’ our shows to customers and make them available for free, those who donate would be seen by several interpretations of the regulations to be paying money in exchange for the online content we produce. Or in other words, buying something.

And to paraphrase our accountant, it’s safer and smarter for us to cease taking donations until the law has been clarified and correct systems set up to allow us to restart receiving donations than it would be to continue and risk a very hefty fine.

For now then, we’re cancelling all our monthly subscriptions services, and we’re working out other ways we can continue to offer patronage options for our fans who want to continue supporting us. Since business-to-business transitions aren’t covered by this, one such option is for us to work with a partner provider who can take care of VAT MOSS long before we receive any payments.

Since our relationships with our advertisers are also B2B, we can continue those too without a problem, which means you’re likely going to hear a business-sponsored ad in our shows form now on rather than a call for donations.

Of course right now, there are two other ways you can help support us and spread the word about the show.

1) Buy a T-Shirt! Our friends over at Spreadshirt deal with all transitions and forward us a small commission with each purchase, so from a financial point of view, that relationship is a B2B one for us and won’t fall under VAT MOSS. So if you haven’t yet, head over to www.transportevolved.com/shop to see if there’s anything which piques your interest.

2) Tell your friends! We love new readers and listeners. And the more readers and listeners we get, the easier it becomes for us to support ourselves with advertising. It doesn’t matter if you’re promoting our YouTube channel or our news site, eyeballs are good!

We’ll keep you posted as and when things change, but for now, there’s nothing left for me to do but to thank you again from myself and the Transport Evolved Crew. The past year has been a fun time, and we’re on the brink of something pretty amazing. It’ll be well worth staying around for.

With warmest gratitude,

Nikki Gordon-Bloomfield.


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