News

VAT ALERT – ONLINE SELLERS – One-Stop-Shop (OSS) for Distance Sales has been postponed until July 2021

/
Date03 Jun 2020
/
Posted By
/

The implementation date for the VAT e-Commerce package has been postponed from 1st January to 1st July 2021.

It was recently announced by the European Commission (EC) that the implementation date for the OSS scheme for distance sellers will be postponed until 1st July 2021. The expected introduction date for this scheme was to be the 1st January 2021. Coronavirus has created issues and delays, and the requirement for EU Member States to adapt their web portals and administrative processes, the EC will allow a further 6-month extension.

Following the European Council proposal on 8th May, 2020 the information was published on the EC website.

What exactly is One-Stop-Shop?

OSS lets online businesses to report all their ‘sales of goods’ to customers across the EU in a single, consolidated VAT return submitted in the country of which it was established.

At present, businesses within the EU which are selling B2C online to customers in another EU Member State must follow the ‘Distance Selling’ system, and this requires a VAT registration in the country of the customer when a given threshold is surpassed. This system, in practice, requires numerous VAT registrations across the EU for online sellers, which increases the difficulty and administrative costs.

With the new OSS system, online sellers will no longer be required to VAT register multiple times, as all foreign sales would be reported in the OSS return. Going forward a separate OSS registration will be mandatory and numerous other official procedures must be kept (i.e. – local VAT rates in each country would still relate), but the necessity of submitting foreign VAT returns would be stopped.

Will the OSS system affect Amazon sellers?

When the OSS goes live in July 2021 Amazon sellers might actually benefit, however, foreign VAT registrations might still be required, as they might keep stock in warehouses located in foreign EU Member States. Fore sure this will be the case for sellers using the ‘Pan-European FBA program’.

Sales in the local countries of warehouses that you use, as well as the whereabouts of goods from and into each foreign warehouse, will require to be reported as a local foreign VAT return. It will be difficult for Amazon sellers to apply for OSS, if you require any help understanding the impact of these new rules for future VAT obligations, we recommend you contact amavat®. Our account managers right across Europe will be only too happy to resolve any questions or queries you might have regarding this new system.

Next steps and further information regarding OSS for online sales

amavat® expects EU Member States in the coming months to start providing information regarding the procedure to register for OSS. This information should include local requirements on important VAT compliance issues, i.e. Intrastat, corrective VAT returns, vouchers and other significant VAT rules which will be affected by this new system. If online sellers or businesses want to benefit from when OSS is implemented, they should follow-up on these changes and anticipate the work involved on registrations.

Why not contact amavat® if you want to know more about the new OSS system for online sales of goods.

***

This circular is non-binding information and serves for general information purposes. The information provided does not constitute legal, tax or management advice and does not replace individual advice. Despite careful processing, all information in this circular is provided without any guarantee for the accuracy, up-to-date nature or completeness of the information. The information in this circular is not suitable as the sole basis for action and cannot replace actual advice in individual cases. The liability of the authors or amavat® are excluded. We kindly ask you to contact us directly for a binding consultation if required. The content of this circular is the intellectual property of amavat® or its partner companies and is protected by copyright. Users of this information may download, print and copy the contents of the circular exclusively for their own purposes.

We are an independent member of HLB. THE GLOBAL ADVISORY AND ACCOUNTING NETWORK.

amavat® provides a one-stop-shop solution for VAT Compliance within Europe. We assist clients with a single point of contact that speaks their language and handles all VAT related issues with a standard and cost efficient approach.
To find out more information please visit www.amavat.eu