The new EU e-commerce One Stop Shop greatly simplifies VAT compliance for online retailers. E-commerce businesses that operate in Hungary have an additional reason to consider the OSS. By using the OSS, sellers can bypass the potentially complex requirements of Hungary’s digital reporting rules.
Introducing Hungary’s eVAT
Hungary recently introduced substantial digital reforms that change the way businesses report invoice data. Hungary’s eVAT requirements create real-time invoice reporting obligations.
For businesses based outside of Hungary that sell to Hungarian customers, the eVAT requirements create an additional layer of complexity.
Specifically, businesses engaged in distance selling to Hungary now need to apply stringent eVAT protocols or face penalties.
A One Stop solution
However, there is an important exception that can make compliance much simpler for online retailers that sell to customers in Hungary. Non-Hungarian online sellers that use the OSS do not have to comply with eVAT real time invoicing requirements.
The OSS offers numerous advantages for online sellers. When using the OSS, companies can account for VAT on online sales throughout the EU with a single OSS VAT return. For e-commerce businesses that sell to customers in multiple EU countries, OSS registration will therefore make good sense from an overall VAT compliance point of view.
Note, however, that the OSS only comes into effect from 1 July 2021. In the interim, businesses selling to customers in Hungary will have to carefully assess their compliance options.
Is the OSS right for your business?
As we can see, the benefits of the OSS extend well beyond simplifying Hungarian VAT compliance. If you sell goods online to customers in EU countries, the OSS is thus likely to be a welcome solution.
That said, while the OSS is a useful alternative to multiple VAT registrations, OSS compliance is nonetheless technical.
Retailers therefore need the technology and processes to ensure full compliance. Vatglobal’s OSS solution is the simplest way to use the One Stop Shop.
Get in touch with Vatglobal for information, advice or assistance about EU VAT compliance. We’ll help you take advantage of the new OSS and ensure you are completely VAT compliant, everywhere you have an obligation.