UK VAT

IOSS Service

Move goods faster, reduce customs delays

Eurora's fully automated IOSS service offers a secure way to take care of VAT registration and reporting when shipping goods to the EU.

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Officially registered Fiscal Representative for IOSS in the EU

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To give out an IOSS number for a client in the EU

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Monthly new customers using Eurora's IOSS services

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Countries covered in our database of regulations, duty & tax rates and free trade agreements

How it works?

Fast IOSS registration with easy onboarding

Get your IOSS registration done in less than 3 working days. Send your Sales data reports through a secure and automated Self-Service Portal or manually by sending a simple CSV file.

Connect to Eurora’s automated service

Personalized solutions based on your company’s requirements to handle your cross-border e-commerce matters. Eurora represents you before the EU Tax Authorities.

Easy access to EU €700 billion ecommerce market

IOSS concerns all business-to-consumer (B2C) sales below €150. Your IOSS ID makes it possible to move goods through customs faster and automatically collect and pay EU VAT.

Fully automated service

Fiscal Representation in the EU

Automate your EU business

A fully automated Fiscal Representation service is in your hand. With easy and free API integration for calculating the correct EU VAT rates and submitting monthly sales reports. Easy API integration ensures a seamless performance that does not affect the efficiency of the checkout process and saves you from paying any extra if your IOSS number is misused.

Register for IOSS

Eurora database covers VAT and duty rates, de minimis thresholds, and active EU free trade agreements

No manual work with fast API calls via Eurora. With a responding time under 100 milliseconds and an accuracy of 96%

Fast IOSS registration

Fast, easy, and transparent IOSS onboarding

Get your IOSS number in one working day while a professional team of tax experts stays by your side and guides you step by step through a transparent IOSS registration process.

Register for IOSS

Full control over your VAT reports with access to secure and automated Self-Service Portal

Personal tax consultant to handle your declaration and tax matters

Fraud protection

Eurora IOSS

Grow your business while we protect you

Eurora handles all your risks by taking full responsibility and liability for IOSS related issues and makes sure you are not taxed when your IOSS number is misused. Our service guarantees 100% protection from any misuse and fraud for the holder of the IOSS number.

Eurora is the first official VAT Intermediary registered in the EU, representing you in all the 27 European Member States

Fully automated Fiscal Representation service protects you from paying any extra if your IOSS number is misused

Features

Fast, easy and automated onboarding

Fraud and IOSS number misuse protection

Fully automated Fiscal Representation service

Full representation before EU Tax Authorities

Benefits

Reach the whole EU market

Using the IOSS, you can sell to every EU country without having to register in each one separetely.

Improve customer experience

Your customers will get their goods faster and be more satisfied with your service thanks to full cost transparency.

Faster customs clearance

Using the IOSS allows for a quicker customs clearance process to move your goods faster.

Comprehensive records

All the VAT records are automatically logged as required by EU tax authorities. Sales records are kept for the 10 years.

Personal solution

Have free access to our skilled team of tax and customs experts who are eager to assist you with your requirements.

Improved cashflow

Improve your finances with monthly VAT declarations that allow you to declare and pay EU VAT only once per month.

Learn more

Register for IOSS

We're EU's first official VAT Intermediary for IOSS and can represent you in all 27 European Member States.

Register here

FAQ – IOSS

1. General Questions

Is IOSS registration mandatory?

No. IOSS registration is optional, and you can still sell goods to EU consumers without registering for IOSS or registering with an IOSS intermediary.

However, once a business registers for the scheme, it must conduct all business and sales to EU customers through the IOSS system. This means you cannot sell to customers in one EU member state under an IOSS number and another EU member state via a different VAT system.

If I am selling via marketplace, do I need my own IOSS number?

If you only make sales through marketplaces, you will not be required to have your own IOSS number because it is now the marketplace’s responsibility to report the transaction to the end consumer. You will make an exempt sale to the marketplace, and they will report the VAT.

Many marketplaces have taken the IOSS approach, they will provide you with their IOSS number and produce the invoices you need to provide to your carrier to ship the goods.

Can IOSS be used for B2B sales?

No, IOSS can only be used for B2C sales. 

If I use the IOSS scheme, is it still necessary to submit the import customs declaration?

Yes, it is still necessary to submit the customs declaration, but if the IOSS registration number is set out in the customs declaration, VAT is not payable upon the import in customs, instead it is collected at the moment of sale.

Are there any restrictions to using IOSS?

IOSS can’t be applied on the sale of goods with a net value exceeding EUR 150 (net value is without VAT). 

IOSS also does exclude goods subject to excise duties (of any value). These are usually things like alcohol and cigarettes.

If I have to keep my IOSS number secret, which number can I give to the post office or to the customs office to prove that I am registered?

The import of goods is exempt from VAT on condition that the valid IOSS number is presented in the customs declaration. The database of the IOSS numbers is not public, it is available only for customs office who automatically check the validity of the number. If the number set out in the customs declaration is valid, customs release the goods for free circulation without the payment of VAT. 

You should not transmit the IOSS VAT identification number to other parties than those involved in the declaration of the goods. You should not mention the IOSS number on the invoice or any other commercial documents.  It is advisable to make a nondisclosure agreement with a customs declarant and describe the obligations when using the IOSS VAT Identification number.

How to prevent the misuse of IOSS numbers?

There is no need to worry about misuse of the IOSS number – this is part of our service to make sure that customer won’t pay any extra VAT and we can always prove if there was a misuse.

Do I have to appoint an Intermediary?

Yes, non-EU companies must appoint VAT Intermediary. The Intermediary must be an EU established taxable person with VAT number. The Intermediary will register the seller to obtain an IOSS VAT identification number. Intermediary covers VAT reporting in all EU Member States under the IOSS Scheme.

We are a non-EU company registered for the IOSS scheme and we also have VAT registrations in Germany, France, Spain and Italy that we use for Amazon. Do we need to file both VAT and IOSS returns?

The division of responsibilities related to VAT obligations depends on transactions.

For the distance sales of goods that you sell via Amazon websites, the Amazon is considered as a deemed supplier and is therefore responsible for VAT obligations for the following supplies made via its electronic interface:

  • Goods intrinsic value not exceeding €150 supplied to a customer in the EU.
  • Goods which are already released into free circulation in the EU and goods which are located in the EU and these goods are supplied to customers in the EU, irrespective of their value.

For the distance sales of goods sold via your own website, you remain liable for the VAT to be paid and you need to submit IOSS VAT return through the Intermediary of your sales to EU in value up to 150eur dispatched from the non-EU country.

As you are registered for VAT in Germany, France, Spain, and Italy, your obligations for filing VAT return in these countries depends on the conditions of registration. For example, in France, it is possible to apply for a VAT registration number also only for customs purposes and no VAT return submission is required. So based on the registration type, you may be obligated to file regular domestic VAT returns in those countries according to general VAT rules from transactions like B2B sales, VAT reclaims, reverse charge transactions, sales made outside the Amazon marketplace, and considered as domestic sales in Germany, France, Spain, and Italy, etc. You should confirm with the Tax Authorities what obligations apply to you.

2. Onboarding & Services

What is the process of signing up for the IOSS service?

You can sign up for IOSS at Eurora Service Portal or email us at  ioss@eurora.com

 

Which details should I provide?

To apply for an IOSS number, some basic details will be required including company´s registration and tax number, website address. Also the contact number and e-mail address of the director and contact person are necessary.

The required documents are Business Registration Certificate or Certificate of Incorporation, Director’s ID document and last 6 months’ sales data to EU (in case there have been sales).

Are there any pre-requisites to using Eurora IOSS service?

Eurora is ready to provide services to every customer who is ready for IOSS scheme. What is important to keep in mind is that you must start calculating VAT at the moment of sales. If you need help with that we can offer a special tool for calculating the correct VAT rates in every destination country.

How to register to IOSS? How is the process? How long does it take to complete the registration?

  1. Sign up to Eurora Portal (https://portal.eurora.com/auth/signin), choose a suitable IOSS package (Lite/Pro/Full) and submit the registration form.
  2. We’ll send you an invoice for the IOSS registration fee and deposit sum via email.
  3. After receiving the payments, we will obtain IOSS VAT number. This will take 1 working day.
  4. VAT reporting will be on monthly basis starting from the month the customer is registered for IOSS.
  5. To provide to us monthly sales data customer can choose: connection via Eurora API (machine-to-machine via endpoint); send Excel standard file or using our app developed for third-party platforms.
  6. For monthly services we will issue an invoice in the beginning of the month.

What do the fees include?

Registration fee includes: customer documentation and information check against the AML rules, preparing the documentation for Tax Authorities for IOSS registration, customer consulting, registration for IOSS, representation before Tax Authorities, preparing access to Eurora Service Portal and/or Eurora API.

Monthly fee includes: VAT return preparation and submission, VAT data verification, VAT payment transfer, use of Eurora Service Portal for monthly obligations, record keeping, data archiving, consultation, representation before Tax Authorities.

How does the monthly process look like?

VAT reporting for IOSS sales is on monthly basis starting from the registration month. We expect sales data from our customers by the 5th of every month, at the latest. Every customer has dedicated Tax Consultant who will clarify this process.

Will you help me deal with customs duties?

In case of IOSS, there is VAT only, payable during purchase, no customs duties. But there is still needed to file customs declarations. We help to file customs declarations.

Eurora suggests its IOSS customers to improve their services with Customs Clearance Service by Alldeclare solution. Alldeclare acts as an indirect representative of consignee in means of UCC. We can create customs declaration ´H7´ dataset via XML to customs authorities as soon as the data is received from IOSS scheme user and goods have arrived the EU. Currently customs services are available in Estonia and soon in Netherlands and Belgium. Customs clearance takes place in member state where goods arrive to EU.

Why do I have to pay full month service fee if I joined with Eurora service in the middle of month?

We have the obligation to file VAT returns to Tax Board and communicate with tax authorities every month starting from the month the IOSS number is valid. The procedure, our obligations, and activities that need to be done are the same, despite the time of IOSS number registration.

Can I make payment to Eurora via Paypal?

No, Eurora can´t accept Paypal payments.

You should make the payment via standard bank transfer method (necessary information given on invoice).

We do have a solution for making transfers to us also for VISA and Mastercard users as card payment, but this method should be pre-agreed first with your contact person in Eurora, who will then provide you a payment link. Please note, that the service fee for paying with VISA or Mastercard is 4% of the amount.

How much notice we are required to give Eurora in advance if our EU sales will discontinue and we want to cancel our IOSS registration?

The notice for closing your IOSS number must be submitted 15 days before the end of the month, then the number will be invalid from the 1st day of the following month.

Can I as a customer use other company’s bank account or Private Account to pay VAT payment and registration fee?

You can use another company`s bank account or a private account for the VAT payment and also for the registration fee or deposit:

  • if the payment is made by another company, we need the business registration certificate for this company*;
  • if the payment is made by a private person, we need the identity document of this person.

*China-based companies must also provide the identity documents of the main shareholder.

 

If I am using a platform like WooCommerce, Shopify, is it possible to integrate with Eurora API for sending you sales data?

For now, we do not have separate apps for different platforms, these are in development. However, we can easily help you with sending sales data.

I did start the registration process, but was asked for a Business Registration Certificate or Certificate of Incorporation and a Director's ID document. These are things which I do not have as a sole trader. How should I proceed?

If you act like a sole trader, then please add only a copy of your ID Document and proceed.

We would like to terminate our IOSS number. Please advise what we have to do?

The notice for closing your IOSS number must be submitted to Eurora at least 15 days before the end of the month, then the number will be invalid since the 1st day of the following month.

After receiving your notice, Eurora will send you an IOSS cancellation notice where you can see the end date of your IOSS number. From the notice, you can see additional information about your obligations and the timeline for submitting the last IOSS VAT declaration to your intermediary, and the “termination of the intermediary service” fee agreement.

If I use the IOSS scheme, is it necessary to issue invoices for customers or is the order confirmation sufficient?

The VAT Directive provides that there is no obligation to issue a VAT invoice for B2C supplies. However, Member States may still impose an obligation to issue an invoice for VAT purposes for this supply. In addition, the customs authorities may require supporting documents for customs clearance which covers typically a commercial invoice.

To which European countries the supply of goods is applied under the IOSS scheme? Are these the members of European Union (EU) or European Economic Area (EEA) or something else?

The IOSS scheme covers all the 27 Member States of EU.

If the customer defines currency as USD, how often the exchange rate of USD/EUR is updated in Eurora database?

We update the currency rates daily. However, for the IOSS VAT returns we eventually use the rate from the last day of the period we are creating the VAT return for.

This requirement comes from the legislation. As we only get to know this rate at the end of the month, then when order data comes in, we calculate based on the current rate that is applicable at the time of submitting data. It is like an indicative value.

Why do you invoice me VAT amount? We have signed up for IOSS not VAT returns.

As you are registered for the IOSS scheme, then it means you must collect VAT from your clients at the moment of sale. Collected VAT must be declared at monthly VAT return and VAT amount must be paid to Tax Authority through Eurora as your Intermediary. You can´t pay the collected VAT to the Tax Authority directly. We inform you monthly of the VAT amount from your sales that must be transferred to us.

Where is our IOSS number registered and how does our customs agent know if our IOSS number is valid?

All the IOSS VAT identification numbers issued by tax authorities in the EU Member States will be made available electronically to all customs authorities in the EU. The customs authorities, when receiving an IOSS VAT identification number in the dataset of the customs declaration, will make an automatic check of its validity against the IOSS VAT identification number database.

The database of IOSS VAT identification numbers is not public, so the person who declares the goods to customs (e.g. postal operators, express carriers, customs agents, etc.) cannot check the validity of the IOSS VAT identification number. They can only check the presence of the IOSS number.

Do we need IOSS when no VAT is charged (0% rate products) on our products in the UK and Ireland?

In this case, you don´t need to apply for an IOSS number. The IOSS scheme is primarily intended to collect and pass on the VAT to the Member State where the parcel is shipped. If the goods sold are taxed with 0% rate, then there is nothing to collect and pass on.

How do you handle our monthly sales data, where do you send it?

The IOSS Intermediary you have chosen is responsible for your sales activities in Europe. The VAT returns are submitted by Eurora based on the sales data we receive from you.

After getting the sales data, we have an obligation to submit the VAT returns through electronic channels to the Estonian Tax and Customs Board.

The declared VAT amount must be paid to Tax Authority and these payments are made through Eurora as your Intermediary. Estonian Tax Authority passes the data and the money to the Tax Authorities of the EU countries, where you have sold the goods. The bookkeeping records involved with IOSS sales have to be kept for 10 years and should be made electronically available to EU Tax Authorities for possible audits.

3. Questions about 'Know Your Customer' (KYC)

What is KYC procedure and what documents are required for that?

EURORA FR Services OÜ is required to undertake KYC and identity checks on potential customers to make sure it is permitted to provide its services. For that we ask to provide some information to us.

To onboard you as a new customer, we will be requiring documents as Business Registration Certificate or Certificate of Incorporation and Director’s ID document.

Who will need to provide identification?

If you operate as a sole trader or sole proprietor (i.e. your business is in your own name) only you will need to provide an identity document. If you operate as a company (i.e. a separate legal entity), we will need to validate the identity of the person signing the agreement.

What forms of ID are needed to onboard me as a customer of Eurora?

To onboard you as a new customer, we will need to check one of the following identification documents: passport, national identity card or driving license, permanent residence card is also acceptable.

What are the rules for expiration and validity of documents?

Personal identification documents should be valid and should not expire in the next six months. Articles of Association, Business registration certificate/ certificate of incorporation, and annual return should not be older than 1 year. More information can be obtained from Tax Consultant.

What is the purpose of proving my identity?

Tax Intermediary Services are governed under local AML Laws and proof of identity is needed for compliance with the legal and regulatory requirements.

What document should I provide if a director is changed?

Form ND2A is required from the Chinese customers to prove the change of any director or extract from the business register. More information can be obtained from Tax Consultant.

Can I appoint a representative?

Yes, you can appoint a representative, who is having legal basis to represent you. That means you are having a legal agreement with the representative to represent you for the VAT intermediary services. 

My company is registered in BVI (British Virgin Islands). Can I apply for IOSS?

Yes, you can apply for the IOSS and in this case the following documents will be required:

  • Certificate of Incorporation,
  • Certificate of Incumbency,
  • photo ID for all the directors, agents, and chairman of the board.

The same is applicable if a company has a BVI company as a shareholder.

4. Tax Questions

If I use the IOSS scheme, do I have to calculate the VAT only for the goods I sell?

You must calculate, collect and pay VAT for the goods and for all the extra costs associated with the sale (transport, insurance etc.) if these costs aren’t already included in the price of the goods.

What rate of VAT will apply to my sales?

This will depend on the type of goods sold and the country in which the customer is based. In the EU the standard rate currently ranges between 17% and 27%. However, a reduced rate may also be applicable for certain goods, which could range from 3 % to 18% in the EU. 

We can offer a special tool- Duty&Tax calculation engine- for calculating correct VAT rates, as there are 27 different Member States and VAT rates vary per state and per goods.

How do I pay the taxes using the IOSS scheme?

A customer using IOSS scheme should ensure the following in respect of VAT:

  • Collect the VAT from the buyer on supplies of all goods transported to the EU in consignments not exceeding EUR 150.
  • Provide monthly sales data to Intermediary for submitting monthly IOSS return for all the supplies of goods sold to customers across the entire EU.
  • The Intermediary will submit the IOSS return monthly, by the end of the following month of supply.
  • The customer will pay VAT payable according to the IOSS return to the Intermediary who will transfer it to the Tax Authority by the same date the IOSS return is submitted.

What is intrinsic value?

The price of the goods themselves when sold for export to the EU, excluding transport and insurance costs, unless they are included in the price and not separately indicated on the invoice, and any other taxes and charges.

To which transactions IOSS applies? How is VAT calculated?

IOSS applies when the net value (intrinsic value) of the goods does not exceed EUR 150. Net value is without VAT. When you use IOSS, then the VAT is paid by your customer at the moment of sale to you.

Example 1: 

Net value of the goods (includes transport price, it means not indicated separately on the order): EUR 140

VAT (20%): EUR 28

Total order amount (the sum the customer pays to you): EUR 168

In this example the net value of the goods is EUR 140. This means that IOSS can be used.

If the transport costs are indicated separately, then transport costs are excluded from the goods value. VAT is paid by your customer at the moment of sale to you.

Example 2:

Net value of the goods (doesn´t include transport): EUR 140

Transport price: EUR 20

VAT (20%): EUR 32

Total order amount (the sum the customer pays to you): EUR 192

In this example the net value of goods is EUR 140. If we are talking about IOSS, we are only talking about net value of goods. In this case IOSS can be used.

If the net value is over EUR 150, then your customer has to pay VAT at destination country to the customs.

Example 3:

Net value of the goods (includes transport price): EUR 165

Total order amount (the sum the customer pays to you): EUR 165

In this example the net value is EUR 165. In this case IOSS cannot be used. This means that your customer has to pay you EUR 165. VAT (20%) EUR 33 will be paid by your customer at the destination country to the customs.

However, if you do charge VAT from the customer, then the customer will pay VAT at the destination country again. If the customer understands that he has been charged VAT twice, he can claim the VAT back from you.

If I sell low value goods to customers in the EU via my own online shop and via an electronic interface that is IOSS registered, then what do I need to do?

You should keep clear evidence of the goods sold via your online shop and the goods sold via the electronic interface. 

If you register in the IOSS for the sales made via your online shop, you should provide your own IOSS number to the person that is responsible for the declaration of the goods for release into free circulation in the EU (e.g. postal operator, express carrier, customs agent) for the goods sold via your own website.

For the goods sold via the electronic interface, you should provide to the person that is responsible for the declaration of the goods for release into free circulation in the EU the IOSS VAT identification number of the electronic interface, since you organize the transport. The electronic interface is obliged to charge and collect the VAT from the customer and to declare and pay VAT to the tax authorities.

If you do not register in the IOSS for the sales via your online shop, you cannot use the IOSS number of the electronic interface for the sales made via your own website. In that case, the VAT for the goods sold via your online shop will be collected from the customer at the moment of importation in the EU.

What is a single consignment?

Goods packed together and dispatched simultaneously by the same consignor (e.g. supplier, underlying supplier or possibly electronic interface acting as deemed supplier) to the same consignee (e.g the customer in EU) and covered by the same transport contract (e.g airway bill) shall be considered as a single consignment. 

Consequently, goods dispatched by the same consignor to the same consignee that were ordered and shipped separately, even if arriving on the same day but as separate parcels to the postal operator or the express carrier of destination, should be considered as separate consignments, unless there is a reasonable suspicion that the consignment was split intentionally in order to avoid the payment of customs duty. In the same manner, goods ordered separately by the same person, but dispatched together, would be considered as a single consignment.

What happens if a customer makes multiple orders, each of them not exceeding EUR 150, with the same supplier (via own webshop or electronic interface)? Subsequently all goods ordered are packed and dispatched together in a single consignment exceeding EUR 150.

Each order is considered a separate supply. As each separate order does not exceed EUR 150 at the moment sale, the VAT should be charged by the IOSS registered supplier. 

When such multiple orders are packed and dispatched together, they will be considered as a single consignment. 

If suppliers know that the goods of multiple orders will be dispatched or transported in a single consignment exceeding EUR 150, they should take a cautious approach and not declare the respective consignment under in the IOSS. The supplier should reimburse the VAT collected at the moment of sale to the customer, indicating that VAT will have to be paid upon importation into the EU. The supplier should keep evidence that the respective orders were dispatched in one consignment exceeding EUR 150.

If suppliers send the respective orders in one single consignment exceeding EUR 150 in value and still indicate the IOSS number, they should be aware that customs will levy VAT upon importation on the entire value of the consignment (including any customs duty) and will disregard the IOSS number. The supplier will need to reimburse the VAT paid under IOSS to the customer based on the proof of payment at EU customs. 

The supplier will be able to correct their IOSS VAT return (if already submitted) in order to reflect that the VAT is no longer due under the IOSS. The supplier should also keep in their records this proof of payment of VAT by the consumer.

What happens for IOSS purposes if a single order from one supplier or underlying supplier exceeding EUR 150 is split (transported to customer) into multiple consignments not exceeding EUR 150?

When purchasing several goods in a single transaction (e.g. order) this would be considered as a single supply for VAT purposes. The expectation is that the goods are dispatched/transported in a single consignment. Since the intrinsic value of the transaction exceeds EUR 150 at the time of supply, the IOSS cannot be used by the supplier or electronic interface. That means VAT should not be charged at the moment of sale and this transaction should not be reported in the IOSS VAT return, even if the goods are dispatched in separate consignments.

A customer purchases in the same order a good of 25 EUR and an excise good (e.g bottle of wine) of EUR 30 from the same supplier. The goods will be dispatched in a single consignment or in separate consignments. Can IOSS be applied on this order?

The sale of the two goods in one order constitutes one single supply. Since excise goods are not covered by IOSS, the entire order will not be subject to VAT at the moment of purchase. The fact that the value of the order does not exceed EUR 150 is not relevant. VAT will be paid upon importation.

If a completed order gets a part refund to the buyer, how to deal with the VAT refund from EU Tax Authority?

If goods are returned to the supplier and you have returned the money to the buyer, then you just send this information to us on monthly basis and corrections will be done in the IOSS VAT return.

The IOSS VAT return is divided to two parts:

  • the first part is the current month’s sales
  • the second part is corrections from previous periods. If the data reported on an IOSS return need to be changed, this is done on the next IOSS return and not by correcting the earlier return. Corrections can be made up to a maximum of three years from the day in which the original declaration had to be submitted.

If the IOSS VAT return correction leads to an overpayment for a Member State then the Member State shall return the overpaid amount.

What happens if the IOSS VAT identification number mentioned in the import declaration is not valid or is not provided at all in the import declaration?

When the IOSS number mentioned in a customs declaration is not valid or not provided at all, then the import scheme cannot be used and the VAT exemption upon importation will not be granted. That means VAT will be levied upon importation. 

The responsibility for providing a valid IOSS number lies with the supplier or the electronic interface.

What will the customs request in case of replacement of goods?

There should be a special field on the import declaration “Free replacement of returned goods”. Import declarations differ depending on the country, but this field is quite common for all of them. There should be the same value of the new item and information that it is a replacement order on the new invoice + reference to the initial invoice also. After filling it in, there shouldn’t be any problems. Also, it`s possible customs will ask the number of initial customs declaration.

What happens if the VAT is not collected by the IOSS registered supplier?

If the VAT is not collected by the IOSS registered supplier or electronic interface and VAT becomes due upon importation into the EU in the Member State of final destination, that Member State can decide freely on the person liable to pay the import VAT (either the customer or the supplier or the electronic interface).

What is the value amount I have to write on the parcel?

The value on the parcel should be the same amount that your customer has paid you for the goods (if there have been additional costs, e.g. transport, insurance etc. these are shown at separate fields at the parcel documentation also). 

Can I send gifts to my customers using IOSS scheme?

According to the VAT legislation IOSS number can be used only for sales which means you can`t use IOSS number at customs declarations when sending gifts and you don`t have to declare gifts on the IOSS VAT declaration. 

To send gifts there is solution to use some logistical company or postal office for delivery clause DDP which means everything is paid by the seller and the buyer will receive goods without any complication.

When is the time of supply for an ordinary eCommerce sale?

The time of supply is the moment when the payment has been accepted. This is the time when the payment confirmation, the payment authorization message, or a commitment for payment from the customer is received by the supplier – whichever is the earliest. Usually, customers pay for the order at the same time when they place the order and that is the time of the supply.

When is the time of supply, if we have pre-orders and long-term supplies?

The time of supply is the moment when the payment has been accepted. If the customer has no obligation to pay for goods at the time of making a pre-order, the time of supply is not relevant yet, meaning you don´t have to declare these pre-orders in the period they were made, but in the period they were paid for. The time of supply arrives, when the operation for collecting the payment from the customer has started (when the customer paid for the goods, the payment confirmation, the payment authorization message, or a commitment for payment from the customer is received by the supplier – whichever is the earliest).

Do we need to declare the sales on the IOSS VAT return if the order has been issued to the customer and the customer has paid it before the IOSS number was issued, but the parcels has been sent out later with the IOSS number? Which date is the date of sale in this case?

When the parcels are shipped with the IOSS number, these sales need to be declared on the IOSS VAT return. In this case, the date of the sale is declared as the date of shipment.

If our company doesn’t charge our customer transport costs (for our customer the transport is free of charge), but our company has transport costs itself, do we still need to show these transport costs on the IOSS VAT return?

If you buy transport services from a courier company or a post office, then this is a B2B (business to business) transaction between you and the courier company. You need to account for these types of transactions as you have done usually. You don’t need to declare these kinds of transport costs on the IOSS VAT return. Only in case you resell the transport costs to your customer (B2C transaction) then you need to collect VAT on transport cost from your customer and declare this on the IOSS VAT return as well.

Why is the transport cost subject to VAT?

According to legislation (EC Directive 2006/112/EC, Article 78), all incidental expenses (incl. transport cost) charged by the supplier to the customer, are considered as a taxable amount.

How does the process look like, if I don’t want to put any tax paying liabilities to customers in EU upon importation?

Then you must use DDP (Delivered duty paid) clause. This means you collect all applicable taxes from your customer before importation and arrange payment through your logistical partner in the destination country. Then your customer receives the parcel without paying taxes upon delivery.

Orders outside the scope of IOSS (above 150 EUR). Would we still collect EU VAT on these orders as this is then paid across to the courier who handles the import in whichever EU country?

Delivered duty paid (DDP) is a shipping agreement that places responsibility on the seller.

In addition to shipping costs, the seller is obligated to arrange for import clearance, tax payment, and import duty. It means if you do not want to cover these costs from your finances, you should collect all applicable taxes from the customer before the importation, at the moment of sale, and arrange payment to your customs agent who will declare them.

I´m using Royal Mail to send my parcels to EU. Why are my customers still charged VAT although I have used my IOSS nr?

The problem might lie in the incorrectly filled pre-advice data. The IOSS number is entered into the Importer tax code field as part of electronic pre-advice data. Electronic customs data is now mandatory when you send goods abroad. You are required to provide customs data electronically in addition to the physical customs declaration (CN22).

How you provide an IOSS number to Royal Mail (UK) depends on which system you use to provide RM with pre-advice data (Click&Drop, Pro Shipping, API shipping, etc). These platforms capture and generate customs data files plus automatically create the required labels to send items abroad.

Instructions for Click&Drop are here: https://www.royalmail.com/sites/royalmail.com/files/2021-06/ioss-click-and-drop-step-by-step.pdf

Do I also need to send you sales data for sales that are subject to 0% VAT?

Yes, you must also send us details of sales that are subject to a 0% VAT rate. This is because in front of the Tax Authority we are jointly responsible for all the sales you have made to the EU with your IOSS number. That means we have to have all the information about these sales so we could answer the Tax Authority´s possible questions.

On shipping invoices, the courier company have charged VAT based on the value of the goods being exported to the EU. Can we claim that VAT back via IOSS?

If you are paying the courier company or the post office for the delivery – this is a B2B (business to business) sale, which is a domestic transaction that has been taxed according to the rules in your country.

So, in an X country VAT return, you must follow the rules relating to X country domestic transactions. You can’t declare this kind of transport costs on the IOSS VAT return.

Do you offer Authorized Representative service for product compliance in the EU?

No, we do not offer Authorised Representative service regarding product compliance in the EU. Certain goods in the EU require CE marking, but this is the responsibility of the manufacturer (and the manufacturer may have such a representative). If you are not a manufacturer, you do not need the Authorised Representative.

What is „stock transfer“? Can it be used with IOSS?

Stock transfer means that a company is moving its unsold goods to a warehouse in the EU and makes final importation on a company name, paying all duties and VAT (de minimis threshold does not apply to commercial import).

IOSS scheme cannot be used, further re-selling to end customers will be declared using the EU internal VAT One-Stop-Scheme. Sending IOSS parcels means that importation is done by the receiver (a private person).

Do I have to file March 30th sale in March VAT return if the goods were cleared in customs on April 1st ?

The VAT return must be submitted based on VAT collection time (order confirmation date). So, if you collected the VAT from your customer in March, you have to report it as a March sale despite of the actual shipment or customs clearance date.

Is it possible to deactivate our IOSS number (put in standby mode)? If yes, can this deactivation be accompanied by a reduced or zero monthly fee?

If you want to keep the IOSS number that you have now, then you must pay our minimum monthly fee (€40), since we must submit IOSS VAT returns every month. Another option is to cancel the IOSS number. This means once you apply for a new IOSS number, you must pay all fees again: registration fee, and deposit.

Please keep in mind that if you want to cancel your IOSS number, then we must notify the Tax Authority about the cancellation at least 15 days before the end of the month when you are about to terminate the implementation of IOSS.

 

When I will have my deposit back?

When our agreement with a Customer is terminated, we`ll send an IOSS number cancellation query to the Estonian Tax Authority. At the same time, we ask you to check all the sales data declared by Eurora on behalf of the Customer. After we have received feedback from Tax Authority, we`ll do all the final calculations. It may take several weeks. According to Annex 1 clause 3.5 of the agreement, Eurora shall return the deposit to your bank account at the latest within three (3) months after the termination of the Agreement.

Eurora shall deduct any transfer costs (and outstanding obligations from previous months) from the returnable amount.