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The new EU VAT scheme has begun. How are you handling it?Click here

New EU VAT scheme

Effective July 1, 2021

The European Union has implemented a new VAT scheme, eliminating the €22 VAT de minimis, which means VAT is due on all orders, regardless of value.

This new scheme expands the options for VAT collection by introducing IOSS, a new method designed to help expedite the customs clearance process. No matter which method you choose, Zonos can help you stay compliant.

Low-value order: an order where the total value of the goods is less than or equal to €150

Find out more

What are my options?

Choose one of the three options below...

Not all carriers support all of the options, be sure to consult with your carrier.

  • Import One-Stop Shop
    (IOSS)

    Recommended for: shops selling high-volume into the EU

    How does it work?

    When VAT is collected:

    At checkout

    Who collects VAT:

    Online retailer

    Clearance speed:

    Fastest
    Pros/Cons

    Pros:

    • Fastest customs clearance
    • Most carrier fees waived

    Cons:

    • VAT registration required
    • Monthly remittance required
    • Intermediary representative required, at your expense
  • Collect VAT
    at checkout

    Recommended for: shops selling lower volumes into the EU

    How does it work?

    When VAT is collected:

    At checkout

    Who collects VAT:

    Online retailer

    Clearance speed:

    Fastest
    Pros/Cons

    Pros:

    • No EU registration
    • No remittance
    • Fast customs clearance

    Cons:

    • Carrier prepayment fees may apply
  • Don't collect VAT

    "Special Arrangement"

    Recommended for: not recommended

    How does it work?

    When VAT is collected:

    After import, prior to delivery

    Who collects VAT:

    Carrier

    Clearance speed:

    Slow
    Pros/Cons

    Pros:

    • You do nothing, no responsibility for VAT

    Cons:

    • Slow customs clearance expected, resulting in delayed delivery
    • Frustrated customers due to lack of transparency on duty, taxes and fees owed (landed cost)

Zonos has you covered!

  • Current Zonos customers
    - it's easy!

    Business as usual: Current Zonos customers do not have to make any changes if they are collecting VAT at checkout! Everything is covered.


    IOSS: If you choose to register as an IOSS, we have you covered and can facilitate VAT collection and reporting to keep you compliant.


    Landed Cost Guarantee: Add Landed Cost Guarantee to your existing account to get the benefits of IOSS, without the need for registration, an intermediary, or remittance, because Zonos will handle all of that for you and much more!

  •   

  • Not a Zonos customer yet?

    Zonos Landed Cost products* can easily handle EU VAT calculations and collection for you!

    Zonos Landed Cost products:

    Add Landed Cost Guarantee to any Landed Cost service to get the benefits of IOSS, without the need for IOSS registration, intermediary, or remittance.


    *APIs and plugins available
    *Use your own carrier

How do I get started?

Check out resources, contact us, or read FAQ below.

EU VAT resources

Read

Docs: Guide to the EU VAT scheme
Docs: How Zonos products handle EU VAT
Blog: A fun read on the EU VAT scheme changes
Dashboard settings: Turn on IOSS for EU VAT

Download

One Sheet: Print or share this informational PDF

Watch

Webinar: EU VAT webinar for a better understanding
I need more info
I need more info

Contact Sales to learn more about Zonos Landed Cost options.

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Already a customer?

Have questions about EU VAT? Contact Customer Success.

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Partners

Contact Business Development to learn more about partnership options.

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EU VAT FAQ

Get answers to the most commonly asked questions.

Does the €150 threshold include the price of the goods only, or does it include the whole invoice including shipping and insurance?

The €150 threshold is for the price of goods only. However, for cart totals below €150, VAT is charged on goods, duty, shipping, and insurance.

Can I ship without collecting taxes and let my carrier collect the VAT instead of my business doing it?

Yes. However, this is not recommended because there are expected to be customs delays for any packages that need the carrier to collect VAT. Also, your customers may not enjoy being surprised with extra costs (duties, taxes and fees) once their package arrives, which could result in abandoned packages.

Can I collect and remit VAT on all orders, including those above €150, so I don’t have to keep track?

Yes, any shipment where the total of goods is more than €150 can have duties and taxes collected from your customer at checkout. You will then ship the package with duties and taxes prepaid and select the option to bill that back to yourself so your customer doesn't get charged again.

If I am shipping B2B to my distributors or retailers do I still need to collect VAT on low-value orders?

Yes, unless they provide you with their VAT number, which will shift the responsibility to them. You will need to include their VAT number on your sales invoice.

What if I’m selling on a marketplace? (Amazon, eBay, Etsy, etc.) Do I need to collect VAT and remit for low-value orders?

Any sales made through a marketplace does not need to have VAT collected by you. The marketplace is responsible for VAT collection and remittance.

What is an EU established intermediary?

A tax representative within Europe (international accounting firm or customs broker) Intermediary – is a person or company in the EU who is co-liable for the payment of the VAT and responsible for fulfilling the obligations laid down in the Import One-Stop Shop scheme.

My company is not established in the EU can the carrier be the intermediary?

No, the carrier cannot act as a tax intermediary.

I already have taxes embedded in my product prices. Will it be mandatory to display VAT at the checkout?

No, but it would be confusing to your consumer if you don't. If the company is IOSS registered then the VAT must be collected in the checkout and itemized on the invoice. If the online retailers is not registered for IOSS, then the carrier will collect based upon the selected carrier D&T billing options.