New EU VAT rules have come into effect which will apply to all businesses both within and outside of Europe for sell to EU buyers. The new rules will also see the introduction of the new Import One Stop Shop (IOSS), which promises to offer full VAT transparency for buyers and sellers as well as faster delivery rates for businesses and marketplace who trade under the scheme.
While the new EU VAT rules apply to all businesses, registration for the IOSS scheme is optional with goods still allowed to be sent to the EU via other postage methods, such as Delivery Duty Unpaid (DDU). However, with the scheme offering multiple benefits for businesses, many are seeking to register for IOSS. Furthermore, due to the UK recently leaving the EU, making are wondering: do my UK businesses have to sign up for IOSS? Or searching for IOSS UK registration.
If a UK business does opt to sign up for the EU's new IOSS scheme, then unless it is established within the EU it will have to sign up via the Import One Stop Shop (IOSS) system via an IOSS fiscal intermediary. An IOSS intermediary is a fiscal representative which must be based in one of the EU member states and will be responsible for declaring and paying owed VAT of the companies they represent to the relevant tax authority in the EU.
This guide aims to give you all the information you need about UK Import One-Stop-Shop registration, including how and where to find an IOSS UK fiscal intermediary representative and how joining the IOSS scheme could benefit your business. Find all your IOSS UK related answers below. Also, if you are looking for a IOSS solution check out about the full IOSS solution offer from shipping sector experts, Ship24.
Under the new EU VAT rules, any imported sale of goods valued at 150 EUR or less will be liable for tax, following the ending of the 22-euro tax exemption threshold on June 30, 2021. The new IOSS rules also state that VAT must be collected at the point of sale by the electronic interface (business or marketplace where the sale took place), meaning that it is the responsibility of the seller or marketplace to declare, collect and pay VAT. The collected VAT must be paid to the relevant tax authorities via an IOSS fiscal intermediary (who will pay the owed VAT on a company's behalf) if they operate outside of the EU. Therefore, an IOSS representative a for UK business will need to be appointed.
The UK's exit from the European Union, dubbed Brexit, means that UK businesses that are not established within the EU must pay VAT through an IOSS intermediary if they want to access the benefits the scheme provides.
Following Brexit, UK sellers are now considered non-EU residents and as a result, will need to register with an IOSS intermediary in order to use the IOSS system when making sales to the EU. They will also be required to meet various EU obligations, such as the declaration and submission of VAT reports from their total sales each month, under the IOSS.
IOSS UK sellers will need to keep a record of all sales for the past 10 years in case an investigation or audit is conducted by the relevant EU tax authorities, which can be done at any time. IOSS UK merchants must also comply with their IOSS intermediary terms and conditions in the event of an investigation by EU tax authorities.
There are various implications of signing up for the IOSS scheme for businesses in the UK. Below is a list of the advantages which UK businesses may find from joining the IOSS scheme:
There are some UK businesses that could be negatively affected by the new EU VAT rules, such as if they currently benefit from the 22 EUR tax exemption threshold if they are involved in the sale of goods exceeding 150 EUR. Aspects of the IOSS and EU VAT changes that could affect businesses are listed below: