If you’re an online retailer doing business in the EU, the differences in sales taxes can be quite a hassle. Startup Staxxer is on a mission to make life easier for e-sellers, with financial tools to automate VAT filing throughout Europe. CTO and co-founder Jurgen Nijland talks about transparency, making a difference and future plans.
Software company Marketphase (co-founded by Nijland and now part of Staxxer) was founded in 2020 and received a G-Force investment later that year. “We officially registered our company at the Chamber of Commerce during the first lockdown”, Nijland says. “Which was a pretty surreal experience, because it was a big and official step for us of course, but you can’t shake hands with the notary."
"And recently, we teamed up with Staxxer, a startup based in Nijmegen, to build more momentum", Nijland continues. "And also because we solve a problem that’s somewhat latent, meaning people tend to think it’s not a problem, until it’s a really big problem. So early on, getting our first clients on board took some convincing, which is also why we’re now working together with Staxxer for things like sales leads and marketing.”
The project started as a way to help entrepreneurs Jaap Krijgsman and Wim Hiemstra, Nijland explains. “Their company Alca Fashion sells plus size men’s clothing through Amazon, in several European countries and the US. Thinking they were completely compliant with the European Tax Law, they got an email from the tax authorities about some VAT irregularities. It took quite some time to clear everything up and Amazon doesn’t give you a detailed VAT overview to figure out what went wrong. And in the meantime, you’re also automatically suspended from selling through Amazon until everything is resolved.”
“So in order to prevent something like that from happening again, we developed a VAT control framework”, Nijland continues. “It gives you a complete overview of what you need to pay per country, automatically checks for any errors or inconsistencies and makes it easy to file taxes, rather than manually going through all those Excel sheets. And we turned that into a company, because we wanted to help other online entrepreneurs too, by offering the transparency that Amazon doesn't.”
Shipping & storage
One example Nijland mentions is shipping and storing through Amazon. “Amazon offers lower shipping costs as soon as you turn on the 'PAN-EUROPEAN' button. That means your goods will be stored at Amazon Fulfilment Centers in various European countries. But what that also means is you need VAT numbers for all the countries your goods are stored in, otherwise you’ll risk being fined and an additional VAT assessment from the tax authorities. Our tool checks where your goods are and where they\re being shipped to and whether or not you have the correct VAT number.”
“The accounting sector is still pretty conservative and a lot of administration is still done manually, with lengthy and complicated Excel sheets”, Nijland continues. “So if there happens to be a tiny typo in that sheet, it can still have some far reaching consequences. So that’s why our tool cross-checks everything through different sources. We’ve even automated it to the point where you can check the currency exchange rates for the day an item was sold. And if you’re a B2B seller, we also automatically check the other party’s VAT number too.”
Bigger clients, more platforms
Staxxer now has around 6 people in their team. So what’s next? “We’ve been steadily growing our client base and that also really helps build trust with prospective clients. Early on, some of the people we talked to were still a little hesitant about automating sensitive data and were more inclined to keep on working with the accountant they already had, because it feels more personal. But the more clients we get, the easier it becomes. We’re working with Shimano now too, for example, which is really awesome. We’re also expanding to other platforms aside from Amazon, like Zalando and Bol.com and taking our first steps to other European countries in the coming years, of which France is probably going to be the first.”
Check out Staxxer.com