Selling goods abroad through an e-shop – distance selling – OSS

Many businesses have moved online and sell through their e-shops. Expanding abroad used to be more complicated than it is today. It was often very demanding, both administratively and financially, for businesses that shipped to several EU countries. The reason was that each country had a different threshold up to which you could sell without having to register for VAT in that country, so businesses often had to monitor their turnover in several countries so as not to exceed the registration threshold there. If they exceeded it, they would have to handle their accounting under that country’s legislation and find an accountant there, which was often financially demanding.

From 1 July 2021, a change in the law adjusted the thresholds for goods supplied within the EU countries. It unified the threshold at €10,000 and introduced the option of a one-stop shop for VAT.

That sounds good, but what does it look like in practice? It is very simple: you no longer have to track separately how much you have sold to Germany, Italy, Poland, the Czech Republic and other countries, or study what their turnover thresholds are; it is enough to track how much you sell to all EU countries together.

So if you sell €4,000 worth of goods to the Czech Republic, €3,500 to Poland and €2,500 to Germany, you can choose whether to register for VAT in each of these countries or to register for the One-Stop-Shop scheme and choose Slovakia as your Member State of identification.

In practice this means that, although you will sell at the VAT rate of the country concerned, you will pay the VAT once a quarter to the Slovak Republic, which will then pay it to the countries concerned on your behalf, based on the OSS VAT return.

Summary

If you are thinking about expanding abroad with your e-shop, do not hesitate. If you have been put off by unnecessary paperwork until now, there is no need to worry – that is a thing of the past. We consider this change very positive, as it allows businesses to grow. If you are interested in a free consultation, just get in touch with us and we will arrange a meeting.