new EU vat rules 2021

New EU VAT guidelines 2021: what adjustments for dropshippers?

New EU VAT guidelines 2021: what adjustments for dropshippers?

If you happen to work in eCommerce, and also you promote to Europeans, you might need heard in regards to the new EU VAT guidelines 2021, that may come into pressure on the 1st July 2021.

The brand new guidelines have been developed to sort out the tax avoidance from eCommerce, that import merchandise from overseas one after the other, and don’t pay the related duties upon the doorway of the objects on European soil.

It sounds actually scary we all know, however don’t fear Yakkyofy bought you lined! Proceed to learn this step-by-step information to grasp what’s altering and what you’ll want to do to proceed promoting with Yakkyofy with out issues.

What’s the distinction between OSS and IOSS?

The brand new EU VAT guidelines 2021 differentiates between One-Cease-Store (OSS) and IOSS (Import-One-Cease-Store)

What’s OSS and the way it works

The Union One-Stop Shop (OSS) “is the digital portal companies can use to adjust to their VAT obligations on e-commerce gross sales throughout the EU to shoppers from 1 July 2021.

The Union OSS is an digital portal that simplifies as much as 95% of VAT obligations for on-line sellers and digital interfaces all through the EU, because it permits them to:

  • Register for VAT electronically in a single Member State for all intra-EU distance gross sales of products and for business-to-consumer provides of companies;
  • Declare and pay VAT due on all provides of products and companies in a single digital quarterly return;
  • Work with the tax administration of their very own Member State and in their very own language, even when their gross sales are cross-border.”

What’s IOSS and the way it works

IOSS (Import-One-Stop-Shop), “in accordance with the VAT guidelines relevant up till 1 July 2021, no import VAT needs to be paid for industrial items of a price as much as EUR 22.

The brand new VAT e-commerce guidelines will abolish this provision as of 1 July 2021. Thus, from 1 July 2021, all industrial items imported into the EU from a 3rd nation or third territory will probably be topic to VAT regardless of their worth.

The IOSS facilitates the gathering, declaration, and cost of VAT for sellers which are making distance gross sales of imported items to consumers within the EU. The IOSS additionally makes the method simpler for the customer, who is simply charged on the time of buy, and subsequently doesn’t face any shock charges when the products are delivered. If the vendor will not be registered within the IOSS, the customer has to pay the VAT and normally a customs clearance payment charged by the transporter.”

What are the most important adjustments? 

Importing Merchandise to the EU (EUR 22 or much less)

Up till the first July 2021, merchandise which have a declared worth that’s equal, or under, EUR 22, should not topic to EU import VAT. This may change underneath the brand new IOSS guidelines, and each product coming into the European market will probably be required to pay VAT.

N.B.: VAT funds are solely utilized to purchases made by consumers residing within the European Union, for objects that price lower than EUR 150. 

The New VAT Guidelines

The EU will introduce a brand new import scheme that may regulate merchandise (as much as a price of EUR 150) imported from third nation international locations.

With this new scheme, the VAT will probably be because of be paid on the Level of Sale (POS), reasonably than when it crosses the EU customs border. 

N.B.:  You’ll have to begin gathering VAT whenever you make gross sales via your eCommerce retailer, on the checkout.  

Timeline of the adjustments

We have now summarized within the desk under the adjustments that will probably be launched with the brand new laws: 

EU VAT POSITION
Earlier than 30/06/2021 After 01/07/2021 
EU Suppliers to EU prospects VAT is dependent upon a number of elements, registration in a number of international locations is perhaps required.  Just one EU VAT registration wanted, can fill OSS returns simply. 
Third Occasion International locations Suppliers to European Clients In line with the VAT guidelines relevant up till 1 July 2021, no import VAT needs to be paid for industrial items of a price as much as EUR 22. VAT collected at POS, fee is dependent upon the vacation spot nation.
EU VAT Registration wanted, along with submission of a 3rd occasion nation OSS return.

New EU VAT guidelines 2021: Yakkyofy bought you lined

We all know the above would possibly sound overwhelming, however don’t fear, as a result of as at all times, Yakkyofy has bought your again!  So let’s see collectively the way it works for those who select to dropship with us! 

First issues first, we are going to begin to apply the brand new rules on all of the parcels paid on our system from the twenty fourth of June, as a result of, additionally if the brand new rules of lOSS will begin from 1st July, you’ll want to take into account the transport time from China to the EU. So it’s extremely possible that each one the parcels paid from the twenty fourth will arrive within the EU after the first of July.

Secondly, completely different guidelines will apply for those who promote your merchandise by way of an impartial retailer platform or for those who open a service provider account on marketplaces reminiscent of eBay or Amazon. 

Final however not least, these new rules will influence solely parcels to the EU, for those who promote within the US, CA, NZ, AU, or Asia, nothing will change.

Promoting via a Market (eBay, Amazon, and so forth)

If you happen to use Yakkyofy to promote objects via a web-based market reminiscent of eBay and Amazon, there will probably be no adjustments within the product costs you pay to us. 

It is because it’s the market itself that may deal with the VAT assortment from consumers situated within the European Union and can present us with their public IOSS that may go over to forwarders. 

Unbiased On-line Retailer Platform (Shopify, Woocommerce, and so forth..)

If you happen to promote with Yakkyofy by yourself retailer constructed on a platform, reminiscent of CommerceHQ, Shopify, WooCommerce, or Storeden, you possibly can have 2 choices:

You’ve got an IOSS quantity

If you happen to already registered to the IOSS platform and you’ve got a registration quantity you possibly can add it within the settings space inside your Yakkyofy Dashboard, on this method we can go it to the freight forwarder that may ship your parcels within the EU with out making use of any further price.

On this method, you’re managing the VAT internally in your retailer so you possibly can arrange the proper charges for every nation, 17% for Luxembourg and 22% for Italy.

Insert your IOSS number

You don’t have an IOSS quantity

If you happen to nonetheless should not have an IOSS identification quantity, you continue to can ship merchandise to the EU however you’ll need to pay an extra payment to the freight forwarders.

Which means from the twenty fourth of June if you don’t ship us your IOSS quantity, you will notice an extra price added to the product value of all orders within Yakkyofy directed to any EU nation.

Do not forget that you could add the proper VAT values inside your retailer settings, to cowl the proper cost for every nation as you see under, they go from 17% charged by Luxemburg as much as 27% utilized in Hungary:

  1. Austria 20%
  2. Belgium 21%
  3. Bulgaria 20%
  4. Croatia 25%
  5. Cyprus 19%
  6. Czech Republic 21%
  7. Denmark 25%
  8. Estonia 20%
  9. Finland 24%
  10. France 20%
  11. Germany 19%
  12. Greece 24%
  13. Hungary 27%
  14. Eire 23%
  15. Italy 22%
  16. Lituania 21%
  17. Lettonia 21%
  18. Luxemburg 17%
  19. Malta 18%
  20. Netherlands 21%
  21. Poland 23%
  22. Portugal 23%
  23. Romania 19%
  24. Slovakia 20%
  25. Slovenia 22%
  26. Spain 21%
  27. Sweden 25%

What adjustments for objects shipped in bulk?

The above guidelines solely apply to drop transport orders, the place you ship objects one after the other, in a single parcel. Then again, for those who import merchandise in bulk, nothing will change for you. 

All you’ll want to do is simply request a citation to Yakkyofy and we are going to present you a quote inclusive of all prices (transport, customs, and so forth.). 

If you are interested to import wholesale products in your own country with Yakkyofy click here.


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