IOSS

The Import One-Stop Shop (IOSS) is an EU VAT regime designed to simplify the collection and remittance of value-added tax on goods imported into the European Union for consumer buyers. It was implemented on 1 July 2021 as part of the EU’s VAT e-commerce package, replacing the need to pay VAT separately at customs for many low-value shipments.

IOSS applies to goods imported into the EU with a value not exceeding 150 euros that are sold to non-business customers (B2C) and imported by postal or express courier operators. When a seller uses IOSS, VAT is charged at the point of sale and remitted to the tax authority of the destination member state via a single IOSS return; shipments that do not use IOSS may still incur VAT at import.

Registration and operation: Businesses register for IOSS with an EU member state, obtain an IOSS identification number, and include this number on the commercial invoice and the customs declaration. VAT is collected at sale, and a monthly IOSS VAT return is filed in the member state of identification; the tax authority distributes the VAT to the appropriate EU member states.

Regimes: Union IOSS is available to businesses established in the EU, while Non-Union IOSS is available to non-EU businesses. Both regimes aim to streamline VAT compliance and provide a single reporting point for eligible shipments.

Limitations and compliance: IOSS does not apply to goods valued over 150 euros or to B2B transactions. Entities must maintain records, file timely monthly returns, and ensure invoicing includes the IOSS number. Non-compliance can lead to penalties or suspension of IOSS registration.