EU IOSS Signup

Discussion in 'International Business' started by Graham Wharton, Apr 20, 2021.

  1. TKJ-London

    TKJ-London UKBF Newcomer

    7 6
    Hello all, I'm just joining this discussion as I've been researching how to register for IOSS as well.

    I understand that IOSS registration is not mandatory until you reach a distance selling threshold of £8800 of goods sold to ALL EU countries combined. I will register in any case as I don't want my customers to bear the burden of paying VAT and customs handling/ admin charges on receipt (those charges are obscene and seem completely arbitrary). So I'd rather charge the EU VAT rate through my online shop and remit to EU - otherwise I expect to lose all my EU business.

    Regarding zero-rated VAT for exports - that's just the government trying to trick you! All it means is you pay no VAT for your goods to *leave* the UK. It has no bearing on what VAT is charged in the receiving country. It's that simple, but the language used makes you think you're sending for free!!

    Also I believe there is a clear reason why we are not able to register for IOSS right now, and that's because EU countries (and probably UK too) are simply not prepared to implement it. I expect the changes due on 1st July will be postponed until 2022. See this article which explains my reasoning (Sorry, as a new user I can't post the link): on the Avalara website article headline "Germany to miss postal operators IOSS July 2021 launch"

    So we languish for longer in limbo... Thanks for having this discussion as it's the only place I've encountered such diligent people actually trying to move forward with IOSS - likely because most small businesses, at least, are completely unaware of upcoming changes to the low value threshold.
     
    Posted: May 20, 2021 By: TKJ-London Member since: May 20, 2021
    #41
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  2. Enz.87

    Enz.87 UKBF Newcomer

    6 1
    We can’t work like that. We have huge amount of money we would like to invest but with this kind of instability it’s real hard to take decisions...
     
    Posted: May 20, 2021 By: Enz.87 Member since: May 13, 2021
    #42
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  3. TKJ-London

    TKJ-London UKBF Newcomer

    7 6
    Indeed, try writing to your MP?
     
    Posted: May 20, 2021 By: TKJ-London Member since: May 20, 2021
    #43
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  4. JPMiddleton

    JPMiddleton UKBF Enthusiast

    323 64
    That article has been live for some time, I don't think it's going to get delayed to be honest - Amazon, eBay and Etsy have all sent info' regarding VAT collection on their marketplaces and DHL are "ready" in that they have the IOSS field on their own MyDHL platform. Our DHL account manager is confident that it is going ahead on July 1st.
     
    Posted: May 20, 2021 By: JPMiddleton Member since: Aug 18, 2011
    #44
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  5. Morning

    Morning UKBF Regular

    81 40
    I think you're confusing the OSS registration rules with the IOSS registration rules. There's no threshold for IOSS registration, but it is entirely optional (albeit desirable for our EU customers).

    You've said you're not UK VAT registered, so you don't need to worry about it.

    If you were UK VAT registered, you would charge your UK customers 20% VAT, and remit that to HMRC, but you would not charge your customers in other countries - your sales for export would be 'zero rated'.

    But since you're not UK VAT registered, you don't collect any VAT so can't zero rate anything, so don't worry about it.

    I don't think they did. The only 'must' in the email is with regards to the requirement to appoint an intermediary if a business chooses to register with the IOSS.



    We do all need to be writing to our MPs though. The UK Gov has, as yet, failed to ensure direct registration access to the IOSS, despite the EU-UK trade agreement including a mutual assistance agreement on VAT. If this is because the MAA is yet to be finalised, or if it is of lesser scope, is unknown, but we need to know if and when things might change.

    At the same time, UK Gov has effectively opened the UK market to foreign e-commerce sellers who fail to register for UK VAT as required - Royal Mail no longer collects, nor checks for, unpaid VAT on consignments under £135. And without an MAA with every country in the world, how is HMRC going to recover unpaid VAT from foreign sellers?

    The contrast between the forthcoming EU VAT scheme and the UK VAT system in place since January is stark.

    The voluntary EU scheme will limit those who choose to register (either direct from a country with an MAA or through an intermediary), but member states then have a mechanism to recover unpaid VAT. If the IOSS is not used, EU VAT will be collected on import from the buyer. Either way, EU member states get their VAT.

    The UK demands all foreign sellers who sell to a UK consumer to register for UK VAT, but has no means of enforcing that, nor for recovering unpaid VAT, and to top it off does not collect unpaid UK VAT on low value consignments at the border.
     
    Posted: May 20, 2021 By: Morning Member since: May 14, 2021
    #45
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  6. nick34785

    nick34785 UKBF Contributor

    182 13
    We ship from Northern Ireland which is inside the EU VAT area, and shipments arrive directly to EU customer without any customs. We currently charge UK VAT. Has there been any update to how IOSS will impact businesses in Northern Ireland?
     
    Posted: May 21, 2021 By: nick34785 Member since: May 25, 2014
    #46
  7. Morning

    Morning UKBF Regular

    81 40
    HMRC published guidance recently. Can’t link to it because I haven't posted enough, but you should find it by googling 'OSS HMRC'.
     
    Posted: May 21, 2021 By: Morning Member since: May 14, 2021
    #47
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  8. nick34785

    nick34785 UKBF Contributor

    182 13
    Thank you! I found it now, published the 13th. Great that we can do this through HMRC and not having to register in another EU country.
    I wonder if the new 10,000 EUR threshold will start from july 1st, or cover the last 12 months, or current year.
     
    Posted: May 21, 2021 By: nick34785 Member since: May 25, 2014
    #48
  9. Simon Perkins

    Simon Perkins UKBF Newcomer

    1 0
    You can register for an EU VAT number and IOSS ID yourself, but you will have to appoint an intermediary based in the EU to manage your EU VAT obligations and do the monthly EU VAT return.
     
    Last edited by a moderator: May 25, 2021
    Posted: May 25, 2021 By: Simon Perkins Member since: May 24, 2021
    #49
  10. ADC

    ADC UKBF Contributor

    158 23
    Why? when the EU trade agreement says we have a mutual agreement for the collection of VAT?
     
    Posted: May 25, 2021 By: ADC Member since: Jun 25, 2009
    #50
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  11. ADC

    ADC UKBF Contributor

    158 23
    Here is the detailed info from EU website about IOSS.

    https://ec.europa.eu/taxation_customs/sites/taxation/files/oss_guidelines_en.pdf

    Look at page 11:-

    [​IMG]

    So if a country has a Mutual Assistance agreement for the recovery of VAT, there is no need for a fiscal representative.

    Here is the EU-UK trade agreement signed off by the EU commission last week:-

    https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:22020A1231(01)&from=EN

    If you look at page 1091 it shows UK have signed a mutual assistance agreement for recovery of VAT

    [​IMG]
     
    Posted: May 25, 2021 By: ADC Member since: Jun 25, 2009
    #51
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  12. Morning

    Morning UKBF Regular

    81 40
    Information from the Irish Revenue OSS desk suggests the MAA may not be complete yet. Or it may not be of adequate scope compared to the agreements on VAT assistance between EU countries, and between the EU and Norway. Either way, we need to be writing to our MPs, and to Liz Truss, asking if and when an MAA will be completed to allow us direct access to the IOSS.
     
    Posted: May 25, 2021 By: Morning Member since: May 14, 2021
    #52
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  13. ADC

    ADC UKBF Contributor

    158 23
    Already done it. Got no response as yet.
     
    Posted: May 25, 2021 By: ADC Member since: Jun 25, 2009
    #53
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  14. Morning

    Morning UKBF Regular

    81 40
    Me neither! But I'll keep sending them until I do.
     
    Posted: May 25, 2021 By: Morning Member since: May 14, 2021
    #54
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  15. JPMiddleton

    JPMiddleton UKBF Enthusiast

    323 64
    The HMRC page about IOSS seems to have been updated, and seems to suggest that whilst it won’t be ready by July 1st - there WILL be a way for UK businesses to register directly.

    https://www.gov.uk/government/publications/eu-e-commerce-package/eu-vat-e-commerce-package

     
    Posted: May 25, 2021 By: JPMiddleton Member since: Aug 18, 2011
    #55
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  16. JPMiddleton

    JPMiddleton UKBF Enthusiast

    323 64
    I got a response from our local MP's office (Andrea Jenkins) that she's going to bring it up today with the relevant ministers.
     
    Posted: May 26, 2021 By: JPMiddleton Member since: Aug 18, 2011
    #56
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  17. schmexit

    schmexit UKBF Contributor

    101 17
    Well done! I will be talking to my MP this week to ask her to bring this up as well.
     
    Posted: May 26, 2021 By: schmexit Member since: May 7, 2021
    #57
  18. DefinitelyMaybeUK

    DefinitelyMaybeUK UKBF Contributor

    106 27
    I see the Royal Mail have updated details of their proposed DDP offerings, see:
    https://www.royalmail.com/business/international/guide/delivered-duties-paid
    These include 'full' IOSS with Deloitte from £2000 a year, 'PAYG' with Taxamo at £2 a parcel and their own DDP (non-IOSS) solution which allows parcels over €150 as well, but details not yet announced.

    Their DDP solution looks interesting if priced right, as the IOSS €150 is quite a low threshold depending on what you sell. The Taxamo offering requires using their 'plugin' at your checkout, again details are vague at this point in time.
     
    Posted: May 27, 2021 By: DefinitelyMaybeUK Member since: Jan 12, 2021
    #58
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  19. ADC

    ADC UKBF Contributor

    158 23
    What i don't understand about this IOSS thing is that it doesn't seem a very secure system. What stops someone using the IOSS number from one of the big marketplace's on their own website orders? Seems open to abuse to me.
     
    Posted: May 27, 2021 By: ADC Member since: Jun 25, 2009
    #59
  20. schmexit

    schmexit UKBF Contributor

    101 17
    I contacted the EU's Europe Direct Contact Centre, and here's their response. WHAT DOES IT MEAN?

    Thank you for contacting the Europe Direct Contact Centre.

    Art. 204 of the VAT Directive states:

    "1. Where, pursuant to Articles 193 to 197 and Articles 199 and 200, the person liable for payment of VAT is a taxable person who is not established in the Member State in which the VAT is due, Member States may allow that person to appoint a tax representative as the person liable for payment of the VAT.

    Furthermore, where the taxable transaction is carried out by a taxable person who is not established in the Member State in which the VAT is due and no legal instrument exists, with the country in which that taxable person is established or has his seat, relating to mutual assistance similar in scope to that provided for in Directive 76/308/EEC (10) and Regulation (EC) No 1798/2003 (11), Member States may take measures to provide that the person liable for payment of VAT is to be a tax representative appointed by the non-established taxable person.

    However, Member States may not apply the option referred to in the second subparagraph to a non-established taxable person, within the meaning of point (1) of Article 358, who has opted for the special scheme for electronically supplied services.

    2. The option under the first subparagraph of paragraph 1 shall be subject to the conditions and procedures laid down by each Member State."

    Indeed, the IOSS facilitates the collection, declaration and payment of VAT for sellers that are making distance sales of imported goods to buyers 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. If the seller is not registered in the IOSS, the buyer has to pay the VAT and usually a customs clearance fee charged by the transporter.

    From 1 April 2021, you can register businesses on the IOSS portal of any EU Member State. If businesses are not based in the EU, they will normally need to appoint an EU-established intermediary to fulfil their VAT obligations under IOSS. The IOSS registration is valid for all distance sales of imported goods to buyers in the EU. You can start using the IOSS only for the goods sold as from 1 July 2021.

    For further information on the rules, please check:
    (can't post link!)

    For further information relevant to your specific case please contact the OOS contact point of the Member State whose IOSS portal you would like to register on: (can't post link!)

    We hope you find this information useful. Please contact us again if you have other questions about the European Union, its activities or institutions.
     
    Posted: May 28, 2021 By: schmexit Member since: May 7, 2021
    #60