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What eCommerce sellers need to know about EU VAT reform come July 1st

Posted on June 23, 2021
by Emma Burgess
selling in the EU

From July 1st, EU VAT regulations for sales and marketplaces are changing. These alterations will significantly impact sellers based outside of the EU, so it’s essential to prepare yourself ahead of July. So, if you’re a foreign entity and are planning to expand your business in the EU, want to stay connected and hold inventory in a UK Huboo Fulfilment centre, you will need to be VAT registered. To help, we’re working with SimplyVAT to guide you every step of the way.

UK and EU Order Fulfilment
European Fulfilment

Here are the key points that eCommerce sellers need to know about EU VAT reform come July 1st

What do I need to know about EU VAT reform?

An Import One-Stop-Shop (IOSS) has been created to facilitate and simplify the declaration and payment of VAT for distance sales of imported goods with a value not exceeding €150. This IOSS will also prevent fraud and generate more tax income for the EU and will affect businesses that sell B2C directly to the EU.

How can I prepare myself ahead of July 1st? 

Sales that are picked and packed from your Amazon or eBay listings to the EU will use their IOSS ID. For other marketplaces and sales channels, you will be required to supply your own individual IOSS ID, so you’ll need to register for this.

There’s no need to do a VAT return in every EU country served, merely submit a monthly IOSS return to the Member State of identification for all the eligible supplies of goods sold to customers in the EU.

Huboo Eindhoven
Huboo Eindhoven

How do I get an IOSS ID?

You must register for your IOSS ID. An intermediary can help set this up for you. Our friends at SimplyVAT will be able to help you with the process.

When do I need to charge EU VAT? 

During the checkout process, like with UK VAT, you will need to obtain the correct EU VAT in the European country where your buyer is residing. The smoothest way to achieve this is by applying the appropriate country VAT rate once you’ve captured your buyer’s delivery address and country.

The European marketplace is one of the largest in the world, but with Brexit in place the challenges continue to hinder selling in the EU. However, help is at hand with our newly opened facility in Eindhoven, Netherlands so that you can continue to grow your international eCommerce business through fulfilment.

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Sell internationally with confidence

If you want your eCommerce business to stay connected with a European fulfilment centre, then send us a message today!