As of 1 July 2021, items imported to the EU with a value of €22 or less will no longer be exempt from VAT. This means that all goods sent directly from GB to consumers in the EU, both via online marketplaces and sales made directly, will be subject to the local rate of VAT in your customer’s country.
As of 1 July 2021
How can I register for IOSS?
You can either register and file your own tax returns, or we can assist you to do so, via our new IOSS Registration and Filing Service – offered by Deloitte. If you register yourself, all you need to do is input your IOSS number into the correct field, where requested, on the Royal Mail shipping platform you use.
If you don’t want to register yourself, we also have Taxamo Assure – an innovative pay-as-you-go solution which is perfect if you simply want to concentrate on selling. See below for further details.
What happens if I don’t act?
If you don’t have a solution in place by 1 July 2021, your items will be delivered by Delivery Duties Unpaid (DDU). Subsequently, customers may have to pay import VAT and a handling fee in the receiving country before they can receive their parcel from our delivery partner. Whatever the case, this could lead to delays, returns and a poor delivery experience. Some customers might refuse delivery, rather than pay these charges.
The Import One Stop Shop (IOSS)
What is the EU’s Import One Stop Shop (IOSS)?
The EU’s Import One Stop Shop (IOSS) is a VAT registration scheme your business can use from 1 July 2021 to comply with the EU’s new VAT e-commerce rules on sales from GB to the EU. If you are despatching goods from Northern Ireland to EU you can use the One Stop Shop (OSS). Details are still being finalised but you will not need to provide a OSS registration number to us.
Once registered for IOSS in only one EU country, VAT can be collected at your online checkout and paid on all EU sales by submitting a single monthly EU VAT return. By using IOSS, our delivery partners will not charge import VAT or a handling fee.
What are Royal Mail’s IOSS solutions?
Register and file your own EU VAT returns
Register yourself for IOSSOnce registered all you need to do is input your IOSS number into the correct field, when requested, on the Royal Mail shipping platform you use. Alternatively, you could consider one of our ‘assisted’ options.
Or use one of our ‘assisted’ IOSS options
A simple ‘pay-as-you-go’ option where Taxamo acts as the deemed reseller for you – allowing you to use its IOSS number to send parcels to consumers located in the EU. This solution will allow you to comply with the new rules and ensure a smooth shopping experience to your customers without having to deal with the complex requirements and submitting VAT returns in the EU.
For sales where Taxamo is the electronic intermediary, there is no need for you to register and file for IOSS. This solution will allow you to comply with the new rules and ensure a smooth delivery experience for your customers. Once you have integrated the technology into your checkout, it does everything for you including automatically calculating the landed cost for you – so you know what to charge at the checkout. Find out more & register here
IOSS Registration and Filing Service offered by Deloitte
You can sign up for Deloitte’s IOSS Registration and Filing service which will enable you to send parcels, with the VAT paid, to customers across the EU with your own IOSS number. This option is recommended for businesses sending higher volumes of parcels to consumers in the EU, who do not wish to register and manage tax returns in house. Find out more & register here
Calculate the landed cost of your goods with Aura from Hurricane
If you register yourself for IOSS, or register via Deloitte’s IOSS Registration and Filing service, you will need to calculate the landed costs of your goods. You can do this by using Aura from Hurricane. This service calculates all import Duty and Tax chargeable at the checkout. It also provides a Prohibited & Restricted Goods check, Denied Parties check and HS code look-up all in one API call. Find out more & register here
Frequently asked questions about IOSS
The chances are that you will have questions about these changes and the options open to you. Take a look at the FAQs and their answers to help you find the right solution for you and your business. Frequently asked questions about IOSS
Royal Mail Postal Delivered Duties Paid (PDDP) Service
As an alternative to DDU and IOSS, we are developing a Postal Delivery Duties Paid (PDDP) service. This is due to be operational by July.
For items valued €150 or more, IOSS cannot be used so PDDP is a solution that has a lower handling fee than DDU. It can also be used for items below €150, if IOSS is not suitable for you.
This service will allow the UK merchant to calculate and collect from their customer at the checkout an additional amount, that will cover the cost of import VAT and customs duty alongside the PDDP handling fee.
If you need help calculating tax then Hurricane’s Aura service can do that at your checkout, also providing a Prohibited and Restricted Goods check, Denied Parties check and HS code look-up all in one API call.
We are also at an advanced stage of deployment planning for commercial solutions for PDDP and will be contacting existing customers in due course.Find out more about IOSS and PDDP
Please note: If you are despatching goods from Northern Ireland to the EU, IOSS cannot be used to declare and pay VAT on your EU sales. Instead, you can make use of the One Stop Shop (‘OSS’) which is another EU VAT scheme that allows you to declare and pay VAT on all sales into the EU in one single VAT return (alternatively, you can register for and pay VAT in each member state you are selling goods to). If your overall annual sales from NI to consumers in all EU countries doesn’t exceed €10,000 you can continue to charge UK VAT to your EU customers.