VAT Invoice Compliance Checklist

The One Stop Shop (OSS) is set to be postponed by 6 months.

The VAT e-commerce package including the One Stop Shop (OSS)  launch date will be postponed by a proposed 6 month period.

Originally due for launch on 1 January 2021, OSS will now be postponed until 1 July 2021. The Mini One Stop Shop or “MOSS” will become OSS as it expands to include distance sales of goods and other B2C supplies of services.

For more recent updates on the 2021 eCommerce changes, read our October update

Simplification of VAT returns for e-commerce

OSS aims to simplify the process of submitting VAT returns for online retailers operating in various Member States.  B2C sellers that dispatch their goods from one country will be able to complete and file a new OSS filing alongside their regular domestic VAT return. The seller will remit the VAT due to their home VAT authority; the taxes will then passed onto the appropriate countries.

Member States were originally working towards 31 December 2020 as the deadline to get ready for this change. Some countries are ready to implement the changes for OSS but some countries are not. The main problem with this is if one country is not ready to implement, the project needed to be postponed.

  • Netherlands and Germany announced that their IT systems would not be ready for the introduction of the OSS procedure from 1 January 1 2021. Both countries asked for a deferment of three years. There has been no further comment on this by Germany, Netherlands or from the EU commission;
  • There are reports that Luxembourg will open their portal for registration in October 2020, however this is not yet confirmed and announced by official webpage Guichet;

The EU Commission has now taken the decision to postpone the application of the VAT e-commerce package by 6 months. These rules will apply as of 1 July 2021 instead of 1 January 2021, giving Member States and businesses more time to prepare for the new VAT e-commerce rules.

More time granted by EU Commission

The EU Commission has constantly indicated its willingness to assist Member States in adapting their national IT systems, and has offered to work with the Member States concerned to find acceptable solutions so that the VAT e-commerce rules can enter into force on time.

The Commission drew up a list of national single points of contact to aid cooperation between national customs and tax administrations to follow up on the project and ensure prompt completion.

Fourteen Member States have communicated the contact details of their single points of contact.

Their role is to ensure smooth and swift communication between national customs and tax administrations and between the Member States and the Commission.

Bulgaria, Cyprus, Germany, Lithuania and the Netherlands have not yet appointed a single point of contact.

The aim of these new measures is to try to create simplicity and harmony across the EU when it comes to VAT compliance of the digital economy and to create a fraud proof VAT system that supports online businesses and SMEs but it remains to be seen if the deadline for implementation can be met.

It is still unclear if the deadline will be met- we will keep you posted as the situation evolves.

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