If you sell things online to clients in the EU, the new e-commerce OSS is likely to benefit you. In addition, the OSS simplifies VAT registration and filing by allowing businesses to account for VAT on sales in multiple EU countries with a single digital VAT return.
For the most part, the OSS will apply to your business if you are an online retailer selling to customers in the EU. However, the OSS will not apply in certain situations. Moreover, because the OSS is optional, an e-commerce business may decide not to use it at certain times. For examples:
It is considered domestic supply if the annual sale of goods and/or digital services to customers throughout the EU is less than €10,000 per year So, the OSS is irrelevant.
The same is true if you currently sell to customers in a number of states, but do not exceed the distance selling threshold in any of the states you sell to. In such cases, you may not be required to register in the foreign country in which you are travelling. As a result, the OSS may not be of any additional benefit to you.
Customers in the EU must comply with a different VAT compliance mechanism if you sell ‘low value goods (no more than €150) that are located outside of the EU at the time of sale
An import one-stop shop is the best system to use in these situations to ensure VAT compliance and expedite imports.
Even when using the OSS, you may have multiple VAT obligations at times. You might do this, for instance, if you store goods in several countries.
There may be advantages to registering in more than one country in certain circumstances. As an example, reclaiming or deferring VAT could be one of the benefits of doing so.
If you have any queries, or would like specific advice, then please do not hesitate to contact a member of our team
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