The One Stop Shop (OSS) scheme makes it a lot easier to file VAT returns on cross-border sales within the EU. But what exactly does the scheme entail, who is it for, and what happens if you fail to meet your OSS obligations?
What is One Stop Shop (OSS)?
The One Stop Shop (OSS) is a special scheme that allows you to file VAT returns for all your sales to consumers in other EU countries, through a single point of contact. Instead of registering for VAT in each separate EU country, you can use the OSS Scheme easily declare your foreign VAT to the Dutch tax authorities. This saves a lot of administration and makes international e-commerce a lot clearer.
The One Stop Shop scheme was created to make cross-border online sales to individuals within the EU easier. You no longer have to register for VAT in multiple countries as long as you take advantage of this scheme.
Which countries are covered by the OSS scheme?
The OSS regulation applies to all 27 EU member states. So if you deliver to consumers in Germany, France, Belgium or Italy, for example, you can declare this foreign VAT in the Netherlands via the OSS portal. Deliveries to consumers on, for example, Spanish islands such as Mallorca or the French overseas territories also fall under OSS, provided it concerns EU territory.
Note: you may only use the OSS scheme for deliveries to individuals within the EU. For deliveries outside the EU (e.g. to the UK or US), other rules apply, such as the IOSS scheme or normal export formalities.
Are you looking for support to make the right decision or would like more information?
If so, please contact us. One of our specialists will be happy to assist you further.
Why does the OSS scheme exist?
The OSS scheme was introduced to make e-commerce within the EU simpler and fairer. Previously, threshold amounts for distance sales applied per country. As soon as a webshop exceeded a threshold in a country, you had to register there for VAT and file a local tax return. This caused a lot of red tape.
With the One Stop Shop VAT scheme, that obligation no longer exists: you register once, and through that counter you file quarterly returns for all EU countries in which you sell. It simplifies administration and prevents errors.
Who is a counter system intended for?
Do you sell products or services to consumers in other EU countries? Then the one-stop-shop system (OSS) is probably for you. This system allows you to file VAT returns for all your EU sales through one portal so without having to register separately in each EU country.
The OSS system is there to keep your VAT records organized. It is optional, but do you opt for it? Then you have to apply it for all your relevant sales within the EU.
OSS schemes
1. Union scheme - for EU-based entrepreneurs.
This scheme is for you if you:
- provides services to consumers in other EU countries where you yourself are not based;
- Sells products to consumers in other EU countries (distance selling).
2. Non-Union scheme - for entrepreneurs based outside the EU
Are you based outside the EU, but provide digital services to consumers within the EU? Then you can declare VAT through this scheme.
3. Import regime (IOSS) - for imports from outside the EU
Do you sell goods to EU consumers shipped directly from a non-EU country? And are those shipments worth a maximum of €150? Then IOSS is the right arrangement. It is available to both EU and non-EU entrepreneurs.
Difference between OSS and IOSS
There is often confusion between OSS and IOSS. Here the difference:
- OSS: For deliveries of goods and services within the EU to consumers. Think of a webshop in the Netherlands delivering to a customer in Belgium.
- IOSS (Import One Stop Shop): For deliveries from outside the EU, with a value of up to €150, delivered directly to consumers. Here you already declare the VAT on import.
In short, OSS you use for sales within the EU, IOSS for sales from outside the EU to EU consumers.
Common mistakes in OSS declaration
Although OSS takes a lot of administrative work off your hands, it still regularly goes wrong. Common errors are:
- Using wrong VAT rates (rates may differ from one EU country to another)
- Late or incorrect reporting of revenue
Failure to register on time for the OSS scheme - Thinking that OSS also applies to B2B sales (it does not)
ECC helps you avoid these mistakes. We support you in the correct registration, declaration and implementation in your e-commerce administration and are happy to think with you about the right approach.
Frequently asked questions about One Stop Shop
Should I use OSS if I sell through Amazon or Bol.com?
If you sell through a platform such as Amazon or Bol.com to consumers in other EU countries, the platform may arrange for VAT returns through their own OSS registration. But this is not always the case. In some cases, you are responsible for the declaration yourself.
What happens if I don't use OSS when I should?
If you do not use the OSS scheme while exceeding the €10,000 cross-border sales limit, you must register for VAT in each individual EU country in which you supply. If you don't, you risk fines or retrospective taxes. OSS prevents this and provides an orderly approach.
How do I file OSS returns in the Netherlands?
You register through the Tax Office for the One Stop Shop system. Once registered, you submit your quarterly VAT return through the Tax and Customs Administration's designated portal. There you enter the turnover per EU country, including the correct VAT rate.
