This Thursday (January 1st 2015) a new European tax legislation will come into effect which will require all UK-based bands and artists to be registered as independent VAT-eligible companies on services such as a Bandcamp.
As Bandcamp have stated, each individual download from customers in a European country will be charged VAT on top of their digital order.
As a result of the changes, EU-based labels and bands will be required to submit a VAT return report quarterly.
An online petition to uphold the VAT Exemption Threshold can be found here.
UPDATE: Bandcamp have made the following comment about the issue:
“If you’ve seen the recent news of changes to EU tax law, you may be wondering how this affects you as an artist or label selling on Bandcamp. The good news is that for digital sales, there is no need for you to register for VAT, submit quarterly reports, and so on. We will take care of all of that for you.
If you happened to see our earlier help item about this, we planned to roll out a temporary solution where artists submitted the tax themselves. We’ve decided to accelerate the changes to our system such that the interim step is unnecessary.”
Further information on the issue can be found at the following links: