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New EU Trade Rule Reminders – IOSS

Trade Rules

Doing business with organisations in the EU has changed and we understand how challenging it can be to get used to the new rules.

Following on from our New EU Trade Rules from 1 July we outline 3 pain points UK exporters face around implementation of Import One Stop Shop (IOSS), the e-commerce system recently introduced by the EU to simplify the payment of VAT, plus updated HMRC guidance on next steps.

Firstly changes to trading low value goods to EU customers and how these new rules impact UK business. Secondly, how to register for Import 1 Stop Shop (IOSS) as a UK based business and thirdly, how to go about appointing an intermediary in the EU, currently a requisite of IOSS.

  1. Trading low value consignments

Low value consignment relief (LVCR) relieving import VAT on goods below €22/£15 has been removed across the EU, making goods sent to EU customers subject to import VAT. Changes apply to those sending non-excise goods in consignments worth up to €150/£135 to the EU.

The EU introduced a new optional online monthly VAT reporting and payment system called Import One Stop Shop (IOSS) to simplify collection of VAT on low value EU imports. If you register for IOSS you must then charge VAT at point of sale to your EU customers, and account for VAT charged on sales across the EU on a single monthly IOSS return and payment. Further guidance on how to notify HMRC is available at Gov.uk.

2. Registering for Import One Stop Shop in the UK

Import One Stop Shop registration in the UK is not currently available for businesses. If your business is based in England, Wales or Scotland, EU rules allow you to register for IOSS in any EU member state, as long as you appoint an EU established intermediary to represent you. Check out further government guidance.

3. Registering requires an intermediary in the EU

Import One Stop Shop (IOSS) is as mentioned an EU system. If you decide to use IOSS you will need to appoint an EU-established intermediary. The UK government is currently in discussions with the EU Commission about the issue of intermediaries, in relation to the EU IOSS scheme, to see whether we can agree that this condition should not apply to UK businesses. There is further government guidance on this matter online.

Let’s Talk

If you need advice on these new EU trade rules including how to implement the Import One Stop Shop (IOSS), please don’t hesitate to contact team LHP. Let’s Talk.

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