Based on what I am describing in my course “How to tax Udemy income” (sorry, only in German) here is the basic rundown about all things VAT (valid for instructors in the EU):
Udemy is responsible for paying VAT.
This is because of the “reverse charge” directive in European tax legislation that concerns all sales of electronic services in Europe. It means Udemy has to collect VAT based on the countries of their customers, pay it in Ireland (their official European site) and Ireland will send the amount to each Euro country. The instructor receives all payments as net payments.
You don’t have to charge VAT
To prove VAT is already paid, the best way is to write an invoice to Udemy:
70 Sir John Rogersons Quay
In this invoice, you list all your income, set the VAT amount to zero (!) and add a statement like:
“VAT liability is transferred to Udemy based on European regulation (“reverse charge” directive).” (in your language, of course).
You don’t have to send out these invoices as Udemy is not interested in them anyway… it’s just a way of keeping your friendly tax guy happy.
(Announcement in German: Was Sie sonst noch dabei beachten müssen, habe ich in einem eigenen Kurs zusammenfasst – mit dem passenden Namen „Wie Sie Udemy-Einnahmen als Dozent richtig versteuern“)