If you provide your invoicing information during the transaction and you have a VIES-registered VAT number you are not charged VAT, you do not need to enter the invoicing information after the fact, you do not need to ask for a VAT return.
If you do provide your invoicing information at the transaction time you do get an invoice emailed to you immediately upon finishing the payment. If you do not provide invoicing information you are making a purchase as an individual and receive a receipt.
You DO NOT get automatic renewals / automatic payments. While Paddle also supports recurring subscriptions, we make it explicitly clear that our subscriptions are one year and DO NOT RENEW AUTOMATICALLY. Even when we had recurring subscriptions (July 2019 to September 2020) they were optional, clearly marked as such, and you'd have to opt into them.
So, to sum it up: your entire problem is that you didn't read the information on your screen, you didn't enter your invoicing information, and got charged VAT as an individual making a purchase (instead of as a company).
As to why we're using Paddle, there are two reasons.
1. In cases like yours where the transaction takes place as an individual making a purchase we were legally forbidden from converting the receipt to an invoice and give a VAT refund. You'd have to eat the VAT cost. Paddle gives you the option to convert the receipt to an invoice within 7 calendar days and request a VAT refund when you make a mistake at purchase time, like you did, since they operate out of the United Kingdom which has different tax laws than the Republic of Cyprus.
2. Starting July 1st, 2019 we are obliged to collect sales tax in ~50 jurisdictions around the world. If we had to do this ourselves we'd need to register a tax entity with each one of these jurisdiction with a cost of half a million Euros per year, many times over our annual profit. We'd have to either raise our prices to between 4000 and 5000 Euros a year, or close up shop. Paddle handles that for us because of economies of scale. They handle the transactions of hundreds of business, therefore these costs can be divided up between all of us, leading to a far more bearable per-transaction cost.
Finally, about your demented reaction to your own mistake: you want to report to the financial authorities that YOU did not provide YOUR OWN invoicing information when making a purchase, therefore the seller charged you VAT as per the EU VAT Directive? Sure. Go ahead.
Or, you know, you can provide the information requested by Paddle's automated system, it will automatically convert your receipt to an invoice, and give you a VAT refund DESPITE THE FACT THAT YOU ARE THE ONE WHO MADE A MISTAKE IN THE FIRST PLACE.
Nicholas K. Dionysopoulos
Lead Developer and Director
🇬🇷Greek: native 🇬🇧English: excellent 🇫🇷French: basic • 🕐 My time zone is Europe / Athens
Please keep in mind my timezone and cultural differences when reading my replies. Thank you!
