Products sent from non-EU and import VAT

[rapidturtle]

Hello all,

I'm seeking help regarding import VAT for EU countries.

I'm registered as a Micro-entrepreneur (auto-entrepreneur) in France.

My products are shipped from South Korea (non-EU) to France and other European countries.

Since my products come from outside the EU, they incur import VAT upon arrival in EU countries.

I want to cover this import VAT myself so my customers don't have to pay it.

I've found that I can use the DDP service to do this.

However, all international delivery companies offering DDP require an IOSS number, which I don't have. I only have an Intra-Community VAT Number.

I understand that IOSS is for non-EU companies, so I'm not eligible for an IOSS number.

To summarize, if you're running a business based in Europe and your products come from non-EU countries, how can you pay the import VAT yourself?

Thank you in advance for your help!

[JuneN]

Hi @rapidturtle,

You can ensure that you cover the import VAT on behalf of your customers by partnering with shipping companies or customs brokers that offer DDP services. This approach helps to provide a smoother and more attractive purchasing experience for your customers in the EU. The problem is that you should carefully setting up your shipping and accounting processes accordingly.

[rapidturtle]

Hello @JuneN 

Thank you for your message.

I have asked several companies that provide DDP service but they asked for my IOSS number.

I have explained that I only have an Intra-Community VAT Number but they needed my IOSS number.

As far as I'm aware, IOSS is for non-EU businesses.

I'd like to find out how other EU based businesses handle import VAT when their products are shipped from non-EU into EU countries.

[TeemuEAS]

Hi Rapidturtle

Better late than never, right 🙂 

IOSS is simplification for goods shipped from outside of EU to EU end-customers with intrinsic value below 150€. IOSS is applicable for both EU and non-EU merchants. 

DDP does not require IOSS. IOSS provides simplified customs procedure and removes the need for carrier to pay taxes to customs. Also, it is a simplification on the fiscal side, meaning single registration, filing and payment of VAT. 

DDP service means that the carrier pays the taxes and duties if applicable to destination country customs (IOSS can be cleared in any EU customs). There are no value thresholds. Customs clearance is the full and therefore slow and expensive. If you have the IOSS number, ask for IOSS services from your carrier, they are significantly cheaper than DDP. 

Feel free o reach out with more questions to us at EAS Project. 

Shopify app link: https://apps.shopify.com/eas-eu-compliance