As of 1 July 2021 all intra-EU distance sales of goods (e.g. all online sales from the stock located in the EU ), will be subject to VAT in the EU MSs where customers are located (in the country of arrival of the goods).
Good news is that VAT registrations in all those EU MSs could be avoided if the VAT reporting will take place via OSS. OSS allows for a single VAT return (“OSS return”) and payment in one EU MS. In addition to EU distance sale of goods, cross-border B2C supplies of services to consumers in the EU, could also be reported in OSS return.
If OSS is used then there will be no need to file VAT returns in all EU MSs where the VAT is due. All B2C sales could be reported via a quarterly OSS return to the “own” tax authorities. The cross-border services to final customers residing in the EU (such as providing admission to events or services related to immovable property) could also be reported in the OSS return. B2B supplies cannot be reported via OSS.
Any occasional input VAT cannot be deducted via OSS and should be claimed through (EU online) VAT refund system for non-established taxpayers.
Where can a business register for OSS?
The EU MS in which you can register for the OSS depends on a number of factors. These factors include the type of supplies you are engaged in (goods or services, or both), any establishments you may have in the EU, and whether you are eligible for the Union scheme or the non-Union scheme.
For example, EU businesses must register for the OSS in their own EU MS. Non-EU businesses without a fixed establishment (FE) in the EU supplying goods across the EU from stock located in one or more of the EU MSs (so-called “EU distance sales of goods”), must register for the Union Scheme in one of the EU MSs where the stock of their goods is located (in one of the EU MSs of the departure of the goods).
Businesses already registered for MOSS
If a business is already registered for MOSS for supplies of TBE services, they should not file a separate OSS registration. Those companies should however update any details of their supplies under OSS.
How can you register for OSS?
- If you choose to make use of OSS then you need to register for it (OSS registrations are possible from 1 April 2021).
- For non-EU businesses OSS registrations are possible from 7 May 2021 in the Netherlands.
- Check which administrative steps (such as de-registrations and notifications in various EU MSs) are required if you choose for OSS.
- If a business is already registered for MOSS for supplies of TBE services, they should not file a separate OSS registration to OSS but update any details of their supplies under OSS if applicable.
- If you choose not to use OSS then check whether any new registrations are required in any of the EU MSs where you have sales to final customers.
Grant Thornton’s international indirect tax team and digital advisory team can assist you in your VAT / customs matters, compliance and update of your systems and processes.
Please contact us if you would like to discuss your options
Grant Thornton Netherlands has tools and software which can make your VAT compliance and OSS reporting simple.
