EU VAT and B2C E-Commerce, the rules will change July 1, 2021 – Chapter 6 – Extension of the OSS to distance sales of imported goods (Import scheme)

As of July 1, 2021, following changes will happen related to the Import of goods for B2C (distance sales)

• Abolish import exemption for consignments of a value ≤ EUR 10-22
  • All distance sales from third countries to the EU are subject to VAT upon importation
• For consignments of a value ≤ EUR 150, the Import One-Stop Shop (IOSS) can be used to declare and pay the VAT
  • If >150 EUR => Standard procedure applicable – customs duties are due and a full customs declaration is required
• If IOSS is NOT used: Simplify the collection of import VAT
  • Global monthly declaration and payment of import VAT. Conditions:
    • Imported goods are not declared under the VAT One Stop Shop
    • Goods not exceeding EUR 150 and are not subject to excise duties
• Why: Significant increase in number of consignments subject to VAT with the removal of the import VAT exemption, Allows efficient and speedy clearance procedures, in particular for postal operators

Import OSS Scheme – How it works

• One Stop Shop for distance sales of goods (value < 150 Eur) imported from a 3rd country (also for EU supplier)
  • Non-EU supplier registered as non-EU One Stop Shop through a designated intermediary in a EU country (at choice)
  • Non-EU supplier or intermediary to report through One Stop Shop
• Import exempted from VAT
• VAT on value of sale
• VAT due upon (acceptance of) payment

Import One-Stop Shop (IOSS) – consignments ≤ 150 EUR

• The vendor (directly or via an intermediary) registers for the IOSS in a MS (the MS of Identification or MSI)
• The vendor charges the VAT to the customer at the time of supply, defined as the time when the payment is accepted
• He declares and pays VAT to the MSI on the basis of a monthly OSS VAT return; the MSI transfers the VAT to all MS of consumption (MSC)
• These consignments are VAT exempt upon importation → the IOSS EU VAT number to be communicated to customs at the latest upon lodging of the import declaration
• Each MS must compile a monthly listing including the total value of imports under the IOSS, per IOSS VAT Nr

See also

• Chapter 1 – Current VAT rules on Distance Sales of Goods (Before July 1, 2021)
• Chapter 2 – Legislative acts for the implementation of the new E-Commerce VAT rules
• Chapter 3 – Services: Improvements to the Mini One Stop Shop in 2019-2021
• Chapter 4 – New art. 33 in the EU VAT Directive 2006/112/EU – Place of Supply Rules for Distance Sales of Goods
• Chapter 5 – Union scheme – Extension of the OSS