How UK companies benefit from the IOSS
By Alexander Maasik
EU is the biggest export market for the United Kingdom. In order to seamlessly do business with the EU and make sure, your goods don’t get stuck on the EU borders, UK businesses should opt into the IOSS (Import One-Stop Shop) scheme.
- selling or supplying goods from Northern Ireland to non-VAT registered customers in the EU
- making supplies of goods from the EU to non-VAT registered customers in Northern Ireland
- sending low-value goods to Northern Ireland (or the EU) from outside the EU and Northern Ireland (including from Great Britain (England, Wales, and Scotland))
- non-EU businesses with goods located in Northern Ireland at the point of sale
It also affects online marketplaces that facilitate the sale of goods:
- located in Northern Ireland (or the EU) by non-EU businesses to non-VAT registered customers in EU and Northern Ireland consumers
- from Great Britain to consumers in Northern Ireland and the EU.
What is the IOSS?
The Import One-Stop Shop is a new way for handling VAT and other taxes that one must pay when importing goods to any EU country.
It allows businesses to collect, declare, and pay VAT on low-valued consignments (up to €150 in value) for all EU sales in one EU country. This system replaces the previous obligation to register in every country where one is selling goods in the EU.
The IOSS also makes the process easier for the buyer, who is only charged at the time of purchase, and therefore does not face any surprise fees when the goods are delivered.
Using the IOSS in the UK
To use the IOSS, the seller must either register a company in the EU themselves or find a fiscal representative in the mainland.
Companies can open a business in any of the 27 EU countries and apply for an IOSS number in this country. In that case, the new company will declare and pay taxes to that country for all EU sales. However, as setting up a legal entity can be expensive and frustrating, it makes more sense to get oneself a Fiscal Representative that takes care of all the VAT reporting in the EU.
A fiscal representative is a company that offers the service of declaring and paying VAT on behalf of the seller.
Eurora was one of the first companies in the world who registered to offer this service. Being an intermediary, Eurora registers UK sellers to obtain a mandatory IOSS VAT identification number. These numbers are unique for each seller. With Eurora, you can get your IOSS registration number for your UK-based business in 3 working days.
Eurora Fiscal Representation service.
When you decide to use Eurora as your IOSS representative in the EU, our professional team of tax experts stays by your side and guides you step by step through the IOSS registration process.
And Eurora IOSS experts will continue to support you with correcting and adjusting your monthly reports, submitting VAT returns, and representing you before the EU tax authorities.
Eurora’s secure system also offers protection against IOSS number misuse and fraud in case someone else uses your IOSS number. As Eurora will keep records of all your transactions for the mandatory 10 years, Eurora can guarantee 100% protection from any misuse and fraud for the holder of the IOSS number.
To get an IOSS registration number for a client, Eurora collects minimum identification information from each customer. This is necessary to assess money laundering and terrorist financing risk according to the EU anti-money laundering rules. Starting from July 2021, Eurora will then act as an intermediary on behalf of the online marketplaces for VAT reporting purposes in all countries in the EU.
Integrations with other Eurora services.
In addition to the Fiscal Representation service, Eurora offers full compliance solutions to UK marketplaces that want to fully automate their cross-border sales process.
With Eurora you don’t need to worry about any trade regulations or common risks associated with using the IOSS. Our automated AI-based solution will assign correct HS codes to your package, calculate the right VAT based on the destination country, generate the electronic declaration, and deal with the EU Tax Authorities. The system also checks each order against prohibited and restricted item lists of destination county and scans the buyer against denied party lists. Making sure, you don’t break any laws while doing business.
Eurora’s services are developed to fully automate all aspects of cross-border trade and to make shipping goods to any part of the world as easy as possible. Eurora’s fully automated and science-backed AI-based solutions allow companies to save time and resources while handling large amounts of data near-instantly and precisely.