EU VAT One-Stop Shop schemes (OSS and IOSS)

On 1 July 2021, the new One-Stop-Shop schemes for goods and services in the EU came into effect. If you have customers in EU countries, you could be impacted.

These schemes simplify VAT registration and remittance in the EU. Quaderno automatically takes care of your tax calculations for the OSS and IOSS schemes.

The new schemes that came into effect on 1 July 2021 are:

• Union One-Stop Shop (OSS) - The current VAT MOSS scheme was expanded to include physical products and services. The union OSS scheme is for EU businesses selling digital products and physical products to consumers in the EU. It requires businesses selling over €10000 per year to consumers in other EU countries to register in the scheme and charge the VAT rate of the customer's country.
• Non-union One-Stop Shop (OSS) - The non-union OSS scheme is for non-EU businesses selling digital products and physical products (shipped from within the EU) to consumers in the EU.
• Import One-Stop Shop (IOSS) - The IOSS scheme is for any EU or non-EU businesses shipping 'low value' goods from outside the EU to customers in the EU. This scheme allows the seller to collect VAT at checkout for sales less than €150. If a business doesn't register in this scheme, the customer may have to pay VAT when they receive the delivery.

Union One-Stop Shop (OSS for EU businesses)

Follow these steps to prepare your Quaderno account:

1. Contact your accountant or tax agency to confirm you are registered in this scheme before making changes to your Quaderno account.
2. Once you have your registration confirmation, add European Union - VAT OSS / IOSS as a jurisdiction in your Quaderno account.

That’s it. Quaderno will automatically apply the OSS rules, applying the VAT rate of the customer's country on each sale.

• For customers in your own country, the VAT rate of your country will apply.
• For customers in other EU countries, the VAT rate of the customer's country will apply. The VAT will be displayed in your OSS report.

Non-union One-Stop Shop (OSS for non-EU businesses)

For non-EU businesses selling digital products to consumers in the EU, there is no threshold for registration in the OSS. This means a non-EU business is expected to register in the OSS from its first sale to a consumer in the EU.

Follow these steps to prepare your Quaderno account:

1. Contact your accountant or an EU tax agency to register in the scheme or confirm your registration status.
2. Once you have your registration confirmation, add European Union - VAT OSS / IOSS as a jurisdiction in your Quaderno account.

That’s it. Quaderno will automatically apply the OSS rules, applying the VAT rate of the customer's country on each sale.

Import One-Stop Shop (IOSS for 'low-value' goods)

If you sell ‘low-value’ (value less than 150 EUR) physical goods from outside the EU to customers in Europe, you can register in the new Import One Stop Shop (IOSS) scheme.

Follow these steps to prepare your Quaderno account:

1. Contact your accountant to confirm if you need to register in IOSS and if you need an intermediary.
2. Register in IOSS in any EU country.
3. Once you have your registration confirmation, add European Union - VAT OSS / IOSS as a jurisdiction in your Quaderno account. Select the option registered in the import scheme when completing your registration details.
4. If you only sell physical goods, please ensure your default product type is set as goods on the preferences page. If you sell goods along with services, please ensure you are distinguishing your product types when creating transactions in Quaderno.
5. If you're not already calculating VAT in your checkout, we recommend doing so. In order to determine if the goods fall below the 150EUR threshold to be included in IOSS, the pricing in your checkout will need to be tax-exclusive.

If you don’t want to participate in the Import OSS (IOSS), then as of 1 July 2021, for any 'low value' consignments (value less than 150EUR) sold from outside the EU to consumers in the EU, the ‘customs declarant’ (i.e. the postal worker, delivery service, customs agent) will collect VAT from the buyer and then pay it forward to the government.

Examples

• A German company sells digital products online and ships physical products from warehouses in Germany. They were already registered in VATMOSS for their digital product sales. From 1st July 2021, Quaderno started applying the customer's VAT rate on their physical product sales, in addition to their digital product sales.
• A Canadian company wants to start selling SaaS to consumers in the EU. They also ship products from Canada to the EU. The company may register in the non-union OSS scheme for their digital product sales and the IOSS for their 'low value' imports. They would then add the new jurisdictions to their Quaderno account.

Common Questions

I am registered in the IOSS, will Quaderno exclude sales over 150EUR in my IOSS report?

Yes, if you are registered in the IOSS, Quaderno will not include sales over 150EUR in your IOSS report. For sales over 150EUR, the customer will be expected to pay any VAT due when collecting the package at customs.

What happened to the old EU distance selling thresholds?

The existing distance selling thresholds for EU countries are no longer be relevant. These thresholds are being replaced by the €10000 EU-wide threshold.

I use warehouses in multiple EU countries. Do I need to register in those countries separately?

If you hold stock in another EU country, you would generally be required to register in that country.

🔎 You can learn more about the EU VAT One-Stop Shop schemes on our blog:

• E-commerce EU VAT changes in 2021
• OSS or IOSS? EU VAT One-Stop Shop rules for e-commerce
• How new EU VAT rules for online marketplaces affect your business

🔎 Other interesting links from the European Commission:

• List of tax agency contacts for the OSS [.pdf]
• All you need to know about the OSS