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VAT - One Stop Shop

The One Stop Shop

Introduction

This section provides information about how to register for the OSS, how to declare and pay VAT in the OSS, record keeping and audits of traders in the OSS and how to leave the OSS. This information is also compiled in a guide, which is available in all EU languages, as well as in Chinese and Japanese.  

Background

The mini One Stop Shop (MOSS), which was put in place on 1 January 2015, has been extended to become a One Stop Shop (OSS) as from 1 July 2021 covering a wider range of supplies and has introduced further simplifications.  

This enlarged One Stop Shop covers three special schemes: the non-Union scheme, the Union scheme and the import scheme. The scope of the already existing non-Union scheme and Union scheme has been extended, whereas the import scheme has been newly introduced. These special schemes allow taxable persons to declare and pay VAT due in Member States in which these taxable persons are (in general) not established via a web-portal in the Member State in which they are identified (Member State of identification). The schemes are optional.  

In practice, a taxable person who is registered for an OSS scheme in a Member State (the Member State of identification) will electronically submit OSS VAT returns detailing the supplies that can be declared in the respective OSS scheme along with the VAT due. The VAT return is submitted quarterly in the non-Union and in the Union scheme and monthly in the import scheme. If a taxable person chooses to use one of the schemes, he has to declare all supplies that fall under that particular scheme via the OSS return of the respective scheme. These OSS VAT returns, along with the VAT paid, are then transmitted by the Member State of identification to the corresponding Member States of consumption via a secure communications network.  

The OSS VAT returns are additional and do not replace the VAT return a taxable person submits to his Member State under his domestic VAT obligations. 

The OSS schemes are available to taxable persons established in the EU and outside the EU. Taxable persons who are established in the EU can use the Union scheme and the import scheme, whereas taxable persons who are not established in the EU can possibly use all three schemes, i.e. the non-Union, the Union and the import scheme.  

Without the OSS schemes, the supplier would be required to register in each Member State in which he supplies goods or services to his customers. The OSS schemes are optional for taxable persons. However, when choosing to use an OSS scheme, the taxable person must apply the scheme to all supplies falling under this scheme in all relevant Member States. The taxable person cannot, therefore, opt to use the OSS scheme just for supplies in some Member States and not for supplies in other Member States. Once opting into the scheme, it is applicable for all supplies to consumers in all Member States.  

The legislation relating to the One Stop Shop is contained in a number of legislative acts (see EU legislation). In order to provide taxable persons and Member States with a clear understanding of the operation of the One Stop Shop, the Commission has brought the salient points together in the form of a Guide to the One Stop Shop. This Guide to the One Stop Shop covers four elements: 

  • The registration process, including deregistration/exclusion 

  • The return process (including corrections) 

  • The payment process, including reimbursements

  • Miscellaneous, including record keeping 

 

For the purposes of these elements, it is important to clarify some basic concepts: 

 

  1. The concept of a taxable person in relation to the One Stop Shop  

Under the non-Union scheme, a taxable person is a business (be it a company, a partnership or a sole proprietor) which has not established its business (place of business) in the EU, nor has a fixed establishment there. Being identified or required to be identified for VAT purposes in the EU does not prevent the taxable person from using the non-Union scheme.  

Under the Union scheme, a taxable person is a business (be it a company, a partnership or a sole proprietor) which has established its business in the EU or has a fixed establishment there.  

Note: A taxable person not established in the EU can also use the Union scheme to declare certain supplies of goods (see part 2 One Stop Shop VAT returns).

Under the import scheme, a taxable person is a business (be it a company, a partnership or a sole proprietor) established within the EU or outside the EU. However, a taxable person established outside the EU is required to appoint an intermediary to use the import scheme. 

 

  1. The concept of deemed supplier 

deemed supplier is a taxable person who is not the actual supplier of certain goods, but he facilitates the supply and is therefore, for VAT purposes (only), treated as the supplier (fiction for VAT purposes). 

A deemed supplier is a taxable person who facilitates a supply of goods that is concluded between a supplier (underlying supplier) and a customer through the use of an electronic interface (e.g. marketplace, platform, portal etc.). 

In the Union scheme a deemed supplier is a taxable person – established in the EU or outside the EU – who facilitates a supply of goods: 

  • via an electronic interface  

  • that takes place in the EU (i.e. intra-Community distance sales of goods as well as domestic supplies of goods)  

  • to a non-taxable person  

  • if the underlying supplier is established outside the EU.  

In the import scheme a deemed supplier is a taxable person – established in the EU or outside the EU – who facilitates a supply of goods:  

  • imported from a third territory or a third country  

  • in a consignment of a value not exceeding EUR 150  

  • to a non-taxable person 

  • via an electronic interface. 

 

  1. The concept of intermediary in relation to the import scheme 

The term “intermediary” is only used in and for the import scheme.  

An intermediary is a taxable person who is established in the EU (business or fixed establishment) and who will be the person liable to pay VAT and to fulfil the VAT obligations laid down in the import scheme (e.g. submission of VAT declaration, payment of VAT, record keeping obligation etc.) in the name and on behalf of another taxable person who has appointed him as intermediary. Member States may introduce additional rules for an intermediary at national level (e.g. requirement of a guarantee). 

A taxable person not established in the EU who wants to use the import scheme, needs to appoint an intermediary for this purpose. Note that taxable persons established within the EU do not need to appoint an intermediary to use the import scheme, but may decide to do so.  

An intermediary has to first get registered in his Member State of identification to be able to act as such. Only after this step, can he register one or more taxable persons who have appointed him to be able to use the import scheme. He will receive a separate IOSS VAT identification number for each taxable person he represents.  

 

  1. The concept of distance sales of goods 

Intra-Community distance sales of goods are supplies of goods that are dispatched or transported from one Member State to another Member State by or on behalf of the supplier (taxable person selling these goods) to a non-taxable person or a person who is treated as non-taxable person. New means of transport and goods supplied after assembly or installation are excluded from this definition and can therefore not be the subject of an intra-Community distance sale. Goods subject to excise duties however fall under this definition. 

Distance sales of goods imported from third territories or third countries are supplies of goods from a third territory or a third country made by or on behalf of the supplier (taxable person selling the goods) to a non-taxable person or a person treated as such. Please note that the goods have to be dispatched/transported from a third territory/third country to fall under this definition. Goods already stored in a warehouse in the EU are not covered and do not qualify as distance sales of imported goods. New means of transport and goods supplied after assembly or installation are excluded and can therefore per definition not be the subject of such a distance sale. 

Note that goods subject to excise duty can be object of a distance sale of imported goods from third territories or third countries, but cannot be declared in the import scheme.

 

  1. The concept of the Member State of identification 

The Member State of identification is the Member State in which the taxable person is registered for using a scheme of the One Stop Shop, and where he declares and pays the VAT due in the Member State(s) of consumption. 

A taxable person can only register in one single Member State to use a special scheme. A taxable person can usually not choose which Member State will be his Member State of identification. He has to follow the respective legal provisions.

 

  1. The concept of the Member State of consumption 

The Member State of consumption is a Member State in which the taxable person supplies goods or services to non-taxable persons, i.e. in which the supply takes place and where the VAT is due.  

In the non-Union scheme, a taxable person can declare supplies of services to non-taxable persons taking place in any Member State of the EU, including the Member State of identification. Any Member State can therefore be Member State of consumption

In the Union scheme, a taxable person can declare cross-border supplies of services to non-taxable persons taking place in a Member State in which that taxable person is not established, i.e. in which the taxable person has neither his place of business nor a fixed establishment. Services supplied to non-taxable persons that take place in a Member State in which the supplier has an establishment cannot be declared in the Union scheme, but have to be declared in the national VAT return of the respective Member State. 

A taxable person can also declare intra-Community distance sales of goods in the Union scheme, regardless of the Member State in which the transport ends. Any Member State can therefore, in this case, be Member State of consumption, including the Member State of identification, on condition that the transport of the goods starts in another Member State.  

deemed supplier can, in addition, declare domestic supplies of goods (i.e. supplies where the transport/dispatch of the goods starts and ends in the same Member State), regardless of whether he is established in this Member State or not. Any Member State can therefore in this case be Member State of consumption. 

In the import scheme a taxable person can declare distance sales of goods imported from a third territory or third country to customers that take place in the EU. This only covers low value goods, i.e. goods in consignments of an intrinsic value not exceeding EUR 150 and does not apply to goods subject to excise duties. Any Member State can therefore in this case be Member State of consumption, including the Member State of identification.  

 

Table1: Member State of consumption

 Member State of consumption 
Non-Union scheme Any Member State  
Union scheme

Services

Any Member State in which the supplier is not established 

Goods

Any Member State different from the Member State in which dispatch/transport of goods starts 

Import scheme Any Member State  

 

  1. The concept of fixed establishment 

For a fixed establishment to be considered as such, it should have a sufficient degree of permanence and a suitable structure in terms of human and technical resources to receive and use or to make the respective supplies. Simply having a VAT identification number does not in itself mean that an establishment qualifies as fixed establishment. 

 

  1. The concept of the Member State of establishment 

The Member State of establishment is a Member State in which a taxable person has a fixed establishment. A taxable person may have established his business in the Member State of identification, but at the same time have fixed establishments in other Member States. Supplies from these fixed establishments to Member States of consumption must also be included in the Union scheme. 

However, in the Union scheme, a Member State of establishment cannot be the Member State of consumption for supplies of services - any relevant supply in this Member State must be declared via the domestic VAT return of the fixed establishment. 

 

  1. The place of supply – threshold of EUR 10 000 

The general rules to determine the place of supply are the following: 

The place of supply of TBE services supplied by a taxable person (the supplier) to a non-taxable person (the customer) is in the Member State where the customer is established, has his permanent address or usually resides.  

The place of supply of intra-Community distance sales of goods is in the Member State in which the dispatch/transport of the goods ends.   

An annual EUR 10 000 turnover threshold for cross-border supplies of B2C TBE services has been introduced on 1 January 2019, up to which the place of supply of such services remains in the Member State where the supplier is established, has his permanent address or usually resides. As from 1 July 2021, this threshold also covers intra-Community distance sales of goods whose transport/dispatch has started in the Member State in which the supplier is established. 

The threshold of EUR 10 000 only applies to TBE services and intra-Community distance sales of goods. It does not apply to other services than TBE services nor to distance sales of imported goods. 

The application of this threshold is subject to the following conditions:  

  1. the supplier is established or, in the absence of an establishment, has his permanent address or usually resides in only one Member State and 

  1. he supplies TBE services to non-taxable persons that take place in another Member State or he supplies goods that are dispatched or transported from the Member State in which the supplier is established to another Member State and 

  1. the total sum of these supplies does not exceed EUR 10 000 (without VAT) in the current and the preceding calendar year.  

If all these conditions are met, these supplies are subject to VAT in accordance with the rules applicable in the Member State of the supplier. The One Stop Shop (Union scheme) is not relevant in this situation, because the supplies will be domestic supplies and cannot be declared in the OSS supply. 

In case the supplier wants to apply the general place-of-supply rules, i.e. Member State of the customer (services)/Member State where the transport of the goods ends (goods) he can decide to do so and will be bound by this decision for two calendar years.  

As soon as the threshold is exceeded, the general rule applies without exception, i.e. the place of of TBE services is in the Member State of the customer and the place of supply of intra-Community distance sales is in the Member State in which the transport of the goods ends.  

The threshold of EUR 10 000 is not counted separately for supplies of cross-border TBE services and intra-Community distance sales, but the sum of all of these supplies must not exceed EUR 10 000 for the threshold to apply.  

Suppliers who have established their business outside the EU and have one or more fixed establishment(s) in the EU cannot make use of the threshold, because the application of the threshold requires that that supplier be only established in one single Member State (and nowhere else).