Non-resident ecommerce country taxation; a new trend in international trade

In 2018, Australia came out with a law that requires non-resident businesses to collect and remit tax on their low-value sales into the country. Businesses must register with Australia in order to file and remit the collected tax each quarter. Australia decided to put this into place as a way to level the playing field for Australian businesses that must charge GST on all of their orders. About a year later, Switzerland implemented a similar law and with New Zealand, Norway, and Indonesia following suit, the trend began.

Since then, the UK and EU have implemented their own post-Brexit VAT laws in 2021, and Singapore is expected to follow suit in 2023 with their own GST law.

With the growing number of countries putting taxation schemes into place, it’s important to know when and how to register, the requirements to stay compliant, and the differences between each country. If you are registered to collect and remit tax for multiple countries, it can be challenging to make sure you are collecting tax on the correct orders or items, meeting the country’s requirements on commercial invoices and labels, and accounting for all the orders you collected tax on so you can report and remit the right amount at the end of the quarter.

That’s where Zonos can help! Zonos will:

• Let you know when you are getting close to the threshold and need to register for a specific country
• Educate you on details of special requirements each country has
• Automatically calculate tax on the correct orders so you don’t over or under-collect taxes
• Provide you with a summary of orders to report on, along with the correct tax amount to remit

Non-resident VAT, GST, ICMS tax collection country guide

Zonos has put together a summary of some key points for each country currently using a non-resident tax scheme. Review this information in the table below, or in the more detailed breakdowns that follow, to stay up-to-date, and to see if you need to get registered for any of these countries.

	Threshold/yr	Collect tax on	Remit	Register	More info	Tax type
Australia 🇦🇺	A$75,000	Orders below A$1,000	Quarterly	website	Docs	GST
European Union 🇪🇺	N/A—It applies to all low-value orders (<=€150)	Orders less than or equal to €150	Monthly	Any EU country revenue website	Docs	VAT
Indonesia 🇮🇩	600 mil rupiahs*	All items	Quarterly	n/a***	Docs	VAT
New Zealand 🇳🇿	NZ$60,000	Items below NZ$1,000	Quarterly	website	Docs	GST
Norway 🇳🇴	NOK50,000	Items below NOK3,000	Quarterly	website	Docs	VAT
Switzerland 🇨🇭	CHF$100,000**	Items below CHF$65	Quarterly	website	Docs	VAT
United Kingdom 🇬🇧	N/A—It applies to all low-value orders (<= £135).	Orders less than or equal to £135	Quarterly	website	Docs	VAT

Australia’s GST taxation law

Threshold amount:
A$75,000 within a 12-month period

Collect GST tax on:
All orders below A$1,000

How often to remit taxes:
Quarterly

How to register:
Register on Australia’s website

Other requirements:
Include a statement on the order’s commercial invoice stating that tax was collected on the order

Learn more about the Australian GST taxation law.

European Union’s VAT taxation law

Threshold amount:
Not applicable—It applies to all low-value orders (less than or equal to €150) if the retailer chooses the IOSS option.

Collect VAT on:
All orders below or equal to €150

How often to remit taxes:
Monthly

How to register:
You can register in any EU country; go to their revenue website to begin registration. Keep in mind that you need a fiscal representative in the EU.

Other requirements:
Appoint a fiscal representative in the EU country of your choice to handle registration and remittance, maintain customer invoices for 10 years, and follow any requirements provided by the country’s government.

Learn more about the EU taxation law

Indonesia’s VAT taxation law

Threshold amount:
600 million rupiahs or website traffic of 12,000 visitors within a 12-month period

Collect VAT on:
All intangible goods and taxable services

How often to remit taxes:
Quarterly for three tax periods

How to register:
The Indonesian government will reach out to you and provide you with a tax identity number

What to do after you register:
Activate your account, update your data online through their system, and follow the requirements provided by the Indonesian government.

Learn more about the Indonesian taxation law

New Zealand’s GST taxation law

Threshold amount:
NZ$60,000 within a 12-mont period

Collect GST on:
Each item that is below NZ$1,000

How often to remit taxes:
Quarterly

How to register:
Register on New Zealand’s website

Other requirements:
Provide a full tax invoice with each order and include a statement on the order’s commercial invoice stating that tax was collected on the order.

Learn more about the New Zealand GST taxation law

Norway VOEC (VAT on ecommerce) scheme

Threshold amount:
NOK 50,000 within a 12-month period

Collect VAT on:
Only items that fall within the VOEC scheme (below NOK 3,000 and not certain types of items).

How often to remit taxes:
Quarterly

How to register:
Register on Norway’s website

Other requirements:
Include your VOEC number on the shipping label

Learn more about Norway’s VOEC scheme.

Switzerland’s low-value consignment relief (LVCR)

Threshold amount:
CHF$100,000 of low-values sales within a 12-month period

Collect VAT on:
Anything with a value below CHF$65

How often to remit taxes:
Quarterly

How to register:
Register on Switzerland’s website

Other requirements:
Appoint a fiscal representative in Switzerland, maintain customer invoices for 10 years, and follow any requirements provided by the Swiss government

Learn more about Switzerland’s low-value consignment relief (LVCR).

The United Kingdom’s low-value VAT taxation law

Threshold amount:
Not applicable—It applies to all low-value orders (less than or equal to £135).

Collect VAT on:
Anything with a value below or equal to £135

How often to remit taxes:
Quarterly

How to register:
Register on the HMRC website

Other requirements:
Ensure you are sending low-value orders into the UK with your UK VAT number on the invoice so that customs knows you will be remitting to HMRC.

Learn more about the UK’s VAT scheme.

Are there any other countries on the horizon?

Singapore will be rolling out its new GST requirements in January of 2023. We’ll provide more information on that in the coming months, so be on the lookout!