VAT and sales tax on sales paid in USDC.

Is VAT due on a sale paid in crypto?

VAT follows the sale, not the payment method. In the UK, HMRC's Cryptoassets Manual, CRYPTO45000, says so directly: "VAT is due in the normal way on any goods or services sold in exchange for cryptoasset exchange tokens." The same page adds that "no VAT will be due on the supply of the token itself", so the USDC changing hands is not a second taxable sale.

In the EU the starting point is the VAT Directive. Article 73 of Directive 2006/112/EC says: "In respect of the supply of goods or services, other than as referred to in Articles 74 to 77, the taxable amount shall include everything which constitutes consideration obtained or to be obtained by the supplier, in return for the supply, from the customer or a third party, including subsidies directly linked to the price of the supply." USDC received for a sale is consideration for that sale.

What did the CJEU decide in Hedqvist (C-264/14)?

The Court of Justice of the EU decided on 22 October 2015 that exchanging traditional currency for bitcoin, and back, is a supply of services that is exempt from VAT under Article 135(1)(e) of the VAT Directive. The case, Skatteverket v David Hedqvist, came from Sweden, where Mr Hedqvist planned an exchange business that would earn the spread between buying and selling prices.

Two passages matter to a merchant. On what bitcoin is (paragraph 42):

And on which currencies the exemption covers (paragraph 49): "Transactions involving non-traditional currencies, that is to say, currencies other than those that are legal tender in one or more countries, in so far as those currencies have been accepted by the parties to a transaction as an alternative to legal tender and have no purpose other than to be a means of payment, are financial transactions."

The ruling is about the exchange business, not about shops. What a merchant can take from it is the court's view of a currency used only as a means of payment: exchanging it is a financial transaction. It does not rule on the goods or services sold for bitcoin, which Article 73 already brings into the taxable amount. The judgment concerned bitcoin; it does not name stablecoins.

How do the UK, the EU and US states treat a crypto payment?

Every source below treats the crypto as the payment and taxes the sale in the local currency. They differ on how they get there:

New York's memo is the most concrete for a seller. It says a seller in New York that accepts virtual currency for taxable goods or services must register for sales tax, record the value of the currency "at the time of each transaction, converted to U.S. dollars", record the sales tax collected the same way, and remit any tax due in US dollars. Where the seller gives a receipt or invoice, it "must separately state the sales tax due in U.S. dollars".

Other states publish their own guidance, and which sales are taxable at all, digital products included, differs from state to state. One memo from one state tells you nothing about the next.

How much VAT is in a 24.00 USDC price?

At a 20% rate, a 24.00 USDC VAT-inclusive price holds 4.00 USDC of VAT, and the tax you report is that amount's value in your own currency when the sale happens. Twenty percent is the UK standard rate on GOV.UK's VAT rates page. Take Quillfern Labs, a UK seller with a 24.00 USDC monthly plan sold to consumers in the UK:

1. VAT fraction of an inclusive price at 20%: 20 / 120 = 1/6.
2. VAT in the price: 24.00 / 6 = 4.00 USDC. Net of VAT: 20.00 USDC.
3. HMRC wants the sterling value at the point of the transaction. At an illustrative rate of 1 USDC = £0.75, the VAT is £3.00; at £0.80 it is £3.20. The USDC amount stays the same while the pound figure moves with the dollar.
4. Each monthly renewal is its own payment with its own date and time, so each one gets its own sterling value.

The customer pays more than 24.00 USDC on a Fianto subscription: a flat 0.01 USDC network fee with each charge today on plans created since 6 October 2026, and after the beta a Fianto fee of about 0.1 to 0.5% on top. Both go to Fianto's treasury in the same transaction, not to you, and the payments export shows them in separate network_fee and fee columns beside the net that reached your wallet. How those columns fit together is in accounting for USDC revenue.

Prices on Fianto can carry up to six decimals, from 0.01 to 1,000,000 USDC, so a price like 24.00 or 23.99 works exactly; how to pick price points is in pricing in USDC.

What does Fianto do about tax at checkout?

Fianto does nothing about tax: it does not calculate, add, collect or file VAT or sales tax, and it issues no invoices (a comparison with an invoicing product is in Request Network vs Fianto). The price you set, less any discount code you accept, is what your wallet receives, and the hosted checkout shows that price with the fees added on top. Any tax therefore has to be inside your price. Where a VAT invoice or a sales tax receipt is required, it comes from your own system.

The checkout also keeps very little about the customer. This is what a payment record holds, and what it does not:

Why does the customer's location matter for VAT on digital sales?

For digital services sold to consumers in the EU, VAT is generally due where the customer is, not where the seller is, as Ireland's Revenue explains on its electronically supplied services page (published 06 July 2026). The page says: "Subject to the B2C €10,000 threshold, the place of supply is where the customer", followed by a list: "is established", "has their permanent address" and "usually resides". For a supplier established in only one member state whose cross-border sales of these services to consumers stay under €10,000 in the current and preceding calendar year, the page says the supplies stay subject to domestic VAT. It adds that the threshold does not apply to a supplier who is not established in the EU.

A wallet address says nothing about where its owner lives, and Fianto collects no country. If you need that evidence, collect it yourself before the checkout. With the API you can create the session from your own server and keep what you collected beside the order, for example a country key in the session's metadata, which comes back on the checkout.session.completed webhook. The fields are listed in the checkout sessions reference. A shop or a payment link offers no way to add one, so a seller who needs location evidence for every sale is better served by the API. A WooCommerce store that creates sessions through the API is one example, in WooCommerce and USDC.

If you cannot collect what your tax rules ask for, Fianto is the wrong tool for those sales, and a card processor that collects billing addresses, or a merchant of record that handles VAT for you, fits better. Customers abroad and card exchange fees are compared in international payments without card FX fees.