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What is IOSS (Import One Stop Shop)?

On the 1st of July 2021, the EU made changes regarding its Value-Added Tax (VAT) rules. VAT will be charged on imports to EU regardless of its value, meaning that the previous rule whereby the exemption for goods valued up to €22 will not be applied any longer. VAT will be imposed at the receiver's country of residences rate, however, the rates differ depending on country in the European Union.

IOSS (Import One Stop Shop) provides an electronic portal that is created to centralise the declaration and payment of VAT for the sales of imported goods (for goods with value not exceeding €150). The IOSS is primarily used for overseas-based sellers to ease their delivery process.

The IOSS means that consumers or shoppers will only be charged once at the time of the purchase. This is to ensure that there are no additional, surprise fees to pay once the goods are delivered. Unlike current shipping methods such as DDU and DDP where the customer usually has to pay for the import VAT and admin fee prior to receiving their shipment. The VAT rate will be aplicable in the EU Member State where the goods are being delivered.

As a result, senders are encouraged to sign up to the IOSS portal, to save not only cost but also to smoothen out the flowd

*Do note that not all the EU states will share the same VAT rate. 

EasyParcel is the author of this solution article.

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