The Import One Stop Shop (IOSS) is an electronic portal that businesses can use from 1st July 2021, to comply with the new VAT system coming into effect.
Currently, any items imported into the EU under €22.00 are exempt from Import VAT. However, this is set to change from 1st July 2021, when all commercial goods imported into the EU will be subject to Import VAT.
How will the IOSS work?
The IOSS allows suppliers and e-commerce businesses selling imported goods under €150.00 to buyers in the EU, to declare and pay their VAT to the tax authorities.
The electronic portal simplifies all payments and declarations by allowing them to be managed by the seller in one place, instead of creating complications and making the buyer pay the VAT. The import VAT amount Is determined by which EU member state the delivery address is in.
IOSS registered goods will be able to pass through customs as the system will recognise that the item has been declared and all duties have been paid, resulting in a simplified and faster delivery experience for both the buyer and the retailer.
What you need to know
How to register for IOSS
If you are based in an EU member state, you can register your business on the online IOSS portal of the member state where you are based.
If your business is based outside the EU and you do not have an EU based establishment, you will need to appoint an EU-established intermediary to register for IOSS and act on your behalf.
The IOSS system can only be used if:
You are the seller, Marketplace or Electronic Interface
The imported goods are dispatched from outside the EU at the time of sale
The imported goods have a total value of under €150.00
More information about the VAT changes can be found here.
Although IOSS is not compulsory, there are many advantages of using the new system that can benefit both your business and your customers.
Smooth and simplified customs process
All costs covered at checkout for customers
Faster delivery on IOSS registered items
Simple VAT reclaims for returns by the seller
Simple shopping experience means customer loyalty
Complex, time consuming customs process
Potential unforeseen costs for customers at customs
Frequent delivery delays due to extra checks
VAT that was paid can potentially be lost when customers return items