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The Import One Stop Shop (IOSS)

The IOSS simplifies the collection and declaration of VAT for drop shippers.

Deliveries are considered drop shipments if no local fulfilment centre is used and there is no consolidation of stock in the EU. The item is imported from outside the European Union (EU) and delivered directly to the customer in an EU country. The Import One Stop Shop (IOSS) specifically applies to goods valued at no more €150.

What is the IOSS for?

The IOSS allows suppliers and electronic interfaces (“EI”) selling imported goods to buyers in the EU to collect, declare and pay the VAT to the tax authorities, instead of making the buyer pay the VAT at the moment the goods are imported into the EU.

Which supplies of goods does the IOSS cover?

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Dispatched or transported from outside of the EU at the time they are sold.

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Dispatched or transported in consignments with a value not exceeding a total of EUR 150 (“low value goods”) even if the order contains more than one item.

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Not subject to excise duties (typically applied to alcohol or tobacco products).

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How does it work?

Sellers registered in the IOSS need to apply VAT when selling goods destined for a buyer in an EU Member State. The VAT rate is the one applicable in the EU Member State where the goods are to be delivered.

Registration

Businesses can register on the IOSS portal of any EU Member State. If businesses are not based in the EU, they will normally need to appoint an EU-established intermediary to fulfil their VAT obligations under IOSS.

The IOSS registration is valid for all distance sales of imported goods to buyers in the EU. You can start using the IOSS only for the goods sold as from 1 July 2021.

What is the process?

  • Provide the info required for customs clearance in the EU (including the IOSS VAT ID)
  • Show VAT amount to be paid by the buyer at the latest when the ordering process is finalised
  • Ensure the collection of VAT from the buyer
  • Make sure that eligible goods are shipped in consignments not > €150 threshold
  • To the extent possible, show on the invoice the price paid by the buyer in EUR;
  • Submit monthly VAT return via the IOSS portal of the Member State where you are registered
  • Pay the monthly VAT declared to the Member State where you are identified for IOSS
  • Keep records of all eligible IOSS sales and/or sales facilitated over 10 years

IOSS does not apply to

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Sales > €150

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If you sell several goods to the same buyer, and these goods are shipped in a package amounting to more than EUR 150.

These goods will be taxed at importation in the EU Member State.

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Your distance sales of goods are facilitated by an EI – the EI is responsible for VAT due

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Do you want to learn more about the IOSS? Read our e-commerce blog posts on the IOSS here.

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international VAT compliance is unmatched.

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