ALL YOU NEED TO KNOW ABOUT THE IMPORT ONE-STOP SHOP (IOSS)

The Import One-Stop Shop (IOSS) is the electronic portal businesses can use from 1 July 2021 to comply with their VAT e-commerce obligations on distance sales of imported goods.
According to the VAT rules applicable up until 1 July 2021, no import VAT has to be paid for commercial goods of a value up to EUR 22.
The new VAT e-commerce rules will abolish this provision as of 1 July 2021. Thus, from 1 July 2021, all commercial goods imported into the EU from a third country or third territory will be subject to VAT irrespective of their value.
What is the IOSS for?
The IOSS allows suppliers and electronic interfaces 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 as it was previously the case (for products over 22 EUR).
What are the advantages of the IOSS?
The IOSS facilitates the collection, declaration and payment of VAT for sellers that are making distance sales of imported goods to buyers in the EU. The IOSS also makes the process easier for the buyer, who is only charged at the time of purchase, and therefore does not face any surprise fees when the goods are delivered. If the seller is not registered in the IOSS, the buyer has to pay the VAT and usually a customs clearance fee charged by the transporter .
What is changing from 1 July 2021?
Online Sellers | Electronic Interfaces |
From 1 July 2021 the value added tax (VAT) exemption for the importation of goods not exceeding EUR 22 will be removed. As a result, all goods imported to the EU will be subject to VAT. The Import One-Stop Shop (IOSS) was created to facilitate and simplify the declaration and payment of VAT for goods sold from a distance by sellers from either the EU or from a non-EU country or territory. Furthermore, VAT payment is applicable only to purchases made by a buyer within the EU and for goods valued at less than EUR 150. | From 1 July 2021, the VAT exemption for the importation of goods into the EU not exceeding EUR 22 will be removed. As a result, all goods imported into the EU will be subject to VAT. If the sale of goods is facilitated through an electronic interface to buyers in the EU, the electronic interface will be considered to have made the sale and is in principle liable for the payment of VAT. The IOSS was created to facilitate and simplify the declaration and payment of VAT for goods sold from a distance by sellers from either the EU or from a non-EU country or territory. Furthermore, VAT payment is applicable only to purchases made by a buyer within the EU and for goods valued at less than EUR 150. |
Which supplies of goods does the IOSS cover?
Online Sellers | Electronic Interfaces |
The IOSS covers the sale of goods from a distance that are:
| When an electronic interface facilitates the sales of imported goods from a supplier and the goods are:
The electronic interface is considered to have facilitated the sale of imported goods when it allows a buyer and a seller to enter into contact via that electronic interface, where the end result is the sale of goods to that buyer. |
How does the IOSS work?
Online Sellers | Electronic Interfaces |
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. Information on the VAT rates in the EU is available on both the European Commission website and on the websites of national tax administrations. | Electronic interfaces registered in the IOSS will pay the VAT due on sale by the buyer instead of the actual taxable seller in an EU Member State. The VAT rate is the one applicable in the EU Member State where the goods are to be delivered. Information on the VAT rates in the EU is available on both the European Commission website and on the websites of national tax administrations. |
How can you register for the IOSS?
Online Sellers | Electronic Interfaces |
From 1 April 2021, you can register businesses 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. | The electronic interface can register on the IOSS portal of any EU Member State from 1 April 2021. If the electronic interface is not established in the EU, it will normally need to appoint an EU-established intermediary to fulfil the VAT obligations under IOSS. This 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 you need to do if you use the IOSS?
Online Sellers | Electronic Interfaces |
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Some exceptions will apply
Online Sellers | Electronic Interfaces |
You do not need to charge VAT on sales of goods in the following circumstances:
| The EI does not need to collect and/or report the VAT on sales of imported goods in the following circumstances:
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McMillan Woods Cyprus Ltd
200 Archiepiskopou Makariou III Avenue,
1st Floor, Office 102,
2311 – Lakatamia, Nicosia, Cyprus
T: +357 22276000 | F: +357 22270807