Understanding the EU One Stop Shop (OSS)
The One Stop Shop (OSS) is one of the most significant simplifications in EU tax history. Introduced on July 1, 2021, it allows businesses selling goods and services to consumers across the EU to declare and pay VAT through a single electronic portal in their home member state, rather than registering for VAT in every country where they have customers.
How OSS works
Before OSS, a German company selling to consumers in France, Italy and Spain would need to register for VAT in each of those countries, file local returns and make payments in each jurisdiction. With OSS, that same company files a single quarterly return through the German tax authority, declaring all cross-border B2C sales and the VAT due in each member state. The German authority then distributes the VAT to the respective countries.
The system replaced the old distance selling thresholds, which varied by country and ranged from โฌ35,000 to โฌ100,000. Now there is a single EU-wide threshold of โฌ10,000 for cross-border B2C sales. Once your total cross-border sales to all EU countries exceed this amount, you must either register for VAT in each destination country or use the OSS. For most sellers, OSS is the obvious choice because it dramatically reduces the administrative burden.
Who should use OSS?
- E-commerce sellers: Any business making B2C cross-border sales of goods within the EU, whether from their own webshop or through marketplaces
- Digital service providers: Companies providing digital services, telecoms or broadcasting to EU consumers, including SaaS platforms, streaming services and app developers
- Marketplace facilitators: Platforms that facilitate sales by non-EU sellers to EU consumers are deemed suppliers under certain conditions and may need to use OSS
The three OSS schemes
There are actually three distinct schemes under the OSS umbrella. The Union scheme covers intra-EU B2C sales of goods and services by EU-established businesses. The non-Union scheme covers B2C services supplied by non-EU businesses to EU consumers. And the Import scheme (IOSS) covers imports of goods valued at up to โฌ150 from non-EU countries directly to EU consumers.
OSS vs IOSS
While OSS covers intra-EU B2C sales, the Import One Stop Shop (IOSS) covers imports of goods valued at up to โฌ150 from non-EU countries directly to EU consumers. IOSS allows sellers to collect VAT at the point of sale rather than having it collected at the border, which speeds up customs clearance and improves the customer experience. Without IOSS, parcels from outside the EU are held at customs until the recipient pays the import VAT, leading to delays and failed deliveries.
Registration process
Registration is done electronically through your home member state's tax portal. You'll need your company details, VAT identification number and bank account information. Returns are filed quarterly (monthly under IOSS), and payment is made to your home tax authority within 30 days of the filing deadline. Each return must break down sales by destination country and applicable VAT rate, so accurate record-keeping is essential.
Zunapro handles the complete OSS and IOSS registration process, quarterly filings and payment coordination for cross-border EU sellers, ensuring you stay compliant without the headache of managing multiple tax registrations.