Non-EU company with direct sales from Non-EU to EU below EUR 150
Based on the nature of the transactions, the responsibilities are the following
The seller based outside the EU is selling goods directly to consumers. The goods are shipped from a Non-EU country to an EU country and their value is below EUR 150.For this transaction the seller can use the Import One Stop Shop (IOSS) scheme to simplify its tax obligations.If IOSS is used, the seller will charge local VAT at the checkout and then report and pay VAT to tax authorities via its IOSS return covering all EU countries. The seller has to appoint an EU based intermediary to represent them for IOSS and this intermediary will share responsibility for reporting and payment of VAT. The IOSS returns can be used only for sales of goods from third countries to the EU with a value below EUR 150 and any other transactions should be included in standard VAT returns.If IOSS is not used, the transaction will be treated as as an import of goods and import VAT will be paid by the seller or the customer depending on agreed terms of sale.
*While our tutorial brings clarity to complex rules, it is not tax advice. There are many exceptions to these rules and the legislation is constantly changing therefore always speak with your trusted tax expert. If you need practical assistance with your VAT obligations we will be happy to help you.