VAT OSS – One Stop Shop in EU |Eurofiscalis
Selling across the EU? The VAT One Stop Shop (OSS) simplifies your VAT obligations. Effective since July 2021, the VAT one stop shop allows you to declare and pay VAT for all EU member states through a single online portal, replacing the need for multiple VAT registrations. Eurofiscalis provides a comprehensive guide to understanding VAT one stop shop schemes (Union, Non-Union, IOSS), registration steps, and compliance requirements, empowering you to streamline your cross-border sales and focus on growth.
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- Reading time : 15 min
- Article updated on : 28/02/2025
Introduction to VAT OSS in EU
What is the VAT One Stop Shop (OSS)?
The VAT One Stop Shop (OSS) is an EU scheme to simplify VAT for cross–border sales of goods and services within the EU. From July 1, 2021 businesses can declare and pay VAT for all member states in one online portal. It replaces the Mini One Stop Shop (MOSS) which was only for digital services, now OSS covers most B2C transactions in the EU.
Objectives of implementing OSS in the EU
By removing the need for multiple VAT registrations and combining VAT reporting onto a single platform, the VAT OSS seeks to reduce administrative burdens. The OSS promotes corporate expansion within the EU digital single market and eases cross-border trade by establishing a standardised platform.
Detailed overview of OSS schemes
Non-union VAT One Stop Shop scheme
Non-EU companies that provide B2C services, like digital, telecommunications, and broadcasting services, are covered by the Non-Union OSS scheme. In order to declare and pay VAT within the EU, businesses can register in one of the member states. By eliminating the need for multiple VAT registrations, this method streamlines compliance. Non-EU businesses may need to appoint a fiscal representative depending on the country of registration.
⇒ Principles of accounting for the VAT at the one stop shop – non- union scheme
Union VAT One Stop Shop scheme
B2C sales of products and services for companies based in the EU are covered under the Union OSS program. Businesses can use a single VAT identification number to report VAT for cross-border transactions via their national tax authority’s portal. This program lets companies avoid registering for VAT in several member states and centralises VAT compliance.
⇒ Principles of accounting for the VAT at the one stop shop – union scheme
Import One Stop Shop (IOSS)
VAT collection for remote sales of imported products up to €150 is made easier by the IOSS. In order to avoid unexpected fees upon delivery, it allows companies to collect and remit VAT at the point of sale. Non-EU companies must appoint an intermediary and obtain a VAT number for registration.
Registration process for VAT One Stop Shop – step by step
Step 1. Determining the member state of identification
Businesses must select a member state of identification based on their establishment or operational presence. Non-EU organizations can choose any member state, often by appointing an intermediary. The business’s VAT reporting for all qualified transactions within the EU will be handled by the selected state. Import One Stop Shop (IOSS) for businesses (EU-based or non-EU-based) selling goods imported into the EU with a consignment value not exceeding €150.
Step 2. Identify your member state of identification
- Non-Union Scheme: register in any EU member state.
- Union Scheme: register your company in the EU member state where it is based. Select one establishment as your Member State of Identification if you have more than one.
- IOSS: register in the member state in which your company is established. For registration, non-EU companies might have to choose an intermediary based in the EU.
Step 3. Prepare necessary information and documentation
Collect the following information:
- Business information including contact information, trade name, and legal name.
- Tax identification, including current EU VAT identification numbers.
- Banking details for VAT payment purposes.
- Description of business activities as type of goods or services supplied.
- Intermediary details (if necessary) information about your appointed EU-based intermediary.
Step 4. Access the online registration portal
- In EU Member States, the national tax authority’s web portal is typically used for registration. In Germany, for instance, companies use the BOP (Bundeszentralamt für Steuern Online-Portal) and need an ELSTER certificate to authenticate their users.
- Non-EU Businesses must use the tax authority portal of the selected member state or designate a third party to complete the registration process for you.
Step 5. Complete and submit the registration application
- Form Completion – Fill out the form completely, including business information, VAT numbers, and descriptions of cross-border operations.
- Submission – Use the portal to electronically submit the application. To prevent processing delays, make sure all of the data is accurate.
Step 6. Await confirmation and OSS identification number
- Processing Time – Your application will be examined by the tax authority. Processing periods might differ; some nations offer confirmation right away, while others might require more time.
- OSS Identification Number – You will be given a distinct OSS VAT identification number upon approval, which you will utilise for all OSS-eligible cross-border transactions.
Step 7. Configure internal systems for OSS compliance
- Accounting Systems – Make sure that the correct VAT rate is applied based on the customer’s location by updating your accounting and invoicing systems to include the OSS VAT identification number.
- Record-Keeping – As required by EU laws, set up procedures to keep thorough records of every transaction covered by the OSS.
Step 8. Commence using the OSS for VAT Reporting
- VAT Returns – Start submitting OSS VAT returns on time (monthly for IOSS, quarterly for Union and Non-Union plans).
- Payment – To guarantee compliance and prevent fines, send the collected VAT via the OSS portal by the deadlines.
You can book a free consultation with our VAT experts in time that is suitable for you!
Declaring and paying VAT through the VAT One Stop Shop
Submission of VAT returns
VAT returns must be submitted quarterly via the member state of identification. The return includes details for all cross-border B2C sales, and businesses must file “nil returns” if no taxable sales have occurred.
Payment procedures
Payments must be made using the unique return reference number on the OSS portal. Businesses must meet submission deadlines because late payments might result in penalties.
Record-keeping and audit requirements for VAT One Stop Shop
Mandatory records to maintain
Businesses must retain detailed records of all OSS transactions for at least 10 years, including customer locations, transaction dates, amounts, and applicable VAT rates.
Accessibility and submission of records
Electronic copies of the records must be accessible for submission to tax authorities upon request. Companies should make sure that this data is easily accessible and stored securely.
Procedures for leaving or deregistering from VAT One Stop Shop
Voluntary deregistration
If companies stop selling internationally or switch programs, they might choose to voluntarily deregister from OSS. Notification must be sent through the portal of the national tax authorities.
Exclusion by tax authorities
For non-compliance, such as frequently late reports or payments, tax authorities have the authority to exclude a company from OSS. A two–year restriction from re-registering for OSS follows exclusion.
Reasons for exclusion from OSS:
- The absence of VAT payments and frequent payment delays were the main factors influencing the exclusions from OSS. Such payment neglects could result in exclusions from the process, as was understood from the outset (when the new VAT settlement option for e-commerce was offered).
- Declared activity ceasing while registering for VAT-OSS
- 8 consecutive zero declarations were filed in the OSS procedure since no deliveries were made.
- Establishing a company’s permanent location (referred to as a “fixed establishment”) in another EU nation
- Insufficient response to the tax office’s three reminders that the VAT-OSS declaration for the three immediately before periods must be submitted within ten days.
- Lack of reaction to the tax office’s three reminders that VAT must be paid within 10 days for the three periods immediately prior (unless the total tax due in each of these three periods was less than €100).
- The taxpayer failed to submit the paperwork that the foreign tax office had asked for.
You can book a free consultation with our VAT experts in time that is suitable for you!
Benefits of adopting the VAT One Stop Shop system
Benefits for you and your business
- OSS eliminates the need for VAT registration in EU countries where you sell but do not store goods, simplifying future operations.
- One 10,000 euro EU-wide threshold will take the place of several nations’ distance thresholds.
This is the total amount of all sales to all EU countries. You need to register for VAT-OSS before exceeding the threshold. Otherwise, you will need to regularize in each country where the threshold has been exceeded (this entails the necessity of registering for VAT and filing a declaration + VAT payments and deregistration), which are obviously costs that can be avoided by monitoring your sales results and registering for VAT-OSS in a timely manner.
- The ability to file a single OSS return that addresses all of your EU VAT cross-border obligations for business-to-consumer transactions is another simplification. You will still need to complete your regular separate VAT returns in both your home country and the countries where you keep items. This is solely relevant to cross-border, business-to-consumer transactions.
- The country home office will process the OSS file VAT return to your home country (for EU sellers, or the designated country for non-EU sellers), and the tax office will send the money owed to other EU countries (keep in mind, only for cross-border B2C transactions).
For instance, businesses will now only need to file one home VAT report and one OSS VAT return every period if they store their goods in their home country and sell them to five or six other EU countries without storing them there. Each return will need to be paid for.
Simplification of VAT compliance
→ By removing the need for several local registrations and combining multi-country VAT reporting into a single site, OSS lowers administrative overhead.
→ By streamlining reporting and payment processes, OSS saves businesses time and reduces compliance costs.
Challenges and considerations in VAT One Stop Shop
Potential pitfalls in OSS implementation
Common problems include misclassifying cross-border sales, completing VAT returns incorrectly, and uncertainty regarding applicable VAT rates.
Staying updated with regulatory changes
Businesses should monitor EU VAT law updates and leverage resources from trusted advisors or national tax authorities to ensure continued compliance.
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Zosia is a marketing specialist in Eurofiscalis, a company with a well-established position in the field of cross-border VAT compliance. Simultaneously, Zosia continues her academic development as a master’s student in Finance and Accounting, which enables her to stay up-to-date with evolving tax regulations.
Combining her knowledge of marketing with a deep understanding of finance and taxes, creates precise, substantive, and easily accessible content. Her mission is to educate in understanding the complexities of taxation related to doing business in international markets.
With her commitment, Zosia translates complex tax issues into clear language, providing valuable information that genuinely helps companies in their development and international expansion. She aims for tax information to be not only understandable but, above all, helpful in making business decisions.
