On the 1st July the EU introduces a new tax regime for UK e-commerce distance sellers selling into the EU. For sales under Euro 150, e-commerce sellers can opt to charge destination country VAT rates to speed up delivery. For sales above Euro 150, sales will continue to be VAT free with the customer having to pay VAT / charges when the package arrives in the destination country. Will Shopify be implementing this threshold so that VAT is included/excluded automatically, or will sellers have to process refunds above Euro 150 or use an external app? Any help on this would be appreciated..
It doesn't matter if you are located in the EU or not. IOSS is needed when your goods dispatch from non-EU countries.
I am happy to explain to you the difference between IOSS and OSS, and what are the solutions.
You can send your question to my email email@example.com
Thank you PEZ.
It is indeed IOSS I need as I am fulfilling from outside of EU. But the feature is not supported on Shopify it seems as my company is registered within EU.
Many thanks for your tip on the tax specialists! I will look it up
I am well aware of IOSS and OSS differences thanks. You can only register for OSS if you are within the EU but we are in UK and use IOSS. We also have a solution to my question which was regarding reporting software.
@PEZ OSS has two different schemes called the union scheme and non-Union scheme. Union Scheme OSS is for the goods and as you mentioned you are aware of it is for the EU sellers only. However, the Non-union scheme OSS is for digital services and goods, like ebooks or some online courses (you can find the full list here: https://www.emta.ee/eng/business-client/income-expenses-supply-profit/overview-charging-value-added-...). The difference is the latter is for non-EU sellers who sell digital products and services to the EU customers. Despite the Union scheme, you can register for VAT and OSS for Non-union schemes in any 27-EU state.
Finally, If you are located outside the EU and you sell some online services or digital products to the EU clients you still can use the OSS scheme to pay your vat return for all your EU sales in only one state.
Important update from HMRC for all UK merchants that sell to North Ireland using the #IOSS scheme:
Tell HMRC you’re registered for the VAT Import One Stop Shop in the EU
If you're registered for the VAT Import One Stop Shop (IOSS) in the EU and sell eligible low-value goods into Northern Ireland, use this service to tell HMRC your IOSS number.