IOSS Tax Charged Incorrectly?

[yesterhome]

Hi guys, 

Does anyone know why Shopify would have charged tax for an EU order incorrectly?

Tax should only be taken for orders under €150 EUR, this order was €154.21 EUR after the discount has been removed. This means the customer has been charged tax at customs and have now paid the tax TWICE. 

Is this just Shopify's system not being accurate enough with the €150 EUR threshold? Any help is appreciated. 

[TeemuEAS]

Hi Yesterhome, 

It is possible to have Shopify calculate taxes for over 150€ shipments as well, we are happy to assist with that if you cant to start using DDP shipments for example. 

IOSS threshold is evaluated from the intrinsic value of goods, meaning zero tax, without shipping or any other fees. That means your shipment is clearly below the IOSS threshold: 173,16 - 30,05 - 18,95 = 124,16. 

So the problem lies elsewhere. And that is most of the times the data transfer between different logistics operators. Do check if the Royal Mail label you had has an IOSS symbol, if not then there is a problem with your setting. To get started we advise our customers to check and take a screenshot of the logistics software where the IOSS number has been input. With this and the tracking code, make an enquiry to Royal Mail. They should be able to provide you with some answer. 

There have been some peculiar issues with IOSS numbers issued by the Ireland tax admin. They have been refused at massive scale at EU customs. Again officials being officials, no official statement has been made. IOSS intermediaries working with them have stated this. 

There have been problems with the EU customs' access to IOSS database, but I have not heard of such issues with the Dutch customs. 

Mind you, you do not have to pay the taxes twice. If you refund the customer and get the receipt from them, you can remove the IOSS VAT liability from that sale. Just hang on to the receipt. The full customs charge they would have also charged the customer is something you have to decide if you are going to reimburse or not. We do recommend to reimburse for customer retention. But up to you. 

If you have more questions, we are happy to help at EAS Project! More on our solution here: https://apps.shopify.com/eas-eu-compliance