OSS Schemes for EU E-commerce: Union, Non-Union, IOSS

In this manual

8. All You Need to Know About OSS VAT Returns

7. VAT Rates in E-commerce When Using OSS Schemes

6. European VAT Rules for Amazon Sellers

5. The Role of an Intermediary for European VAT

4. How Does VAT Work on Sales via Online Marketplaces in Europe?

3. OSS Registration in the EU

2. Applicable OSS Schemes in EU E-commerce Sales

1. European VAT Regulations for E-commerce

There are different schemes in the European VAT regulations according to the activity and place of business of the seller: Non-Union OSS, Union OSS and Import OSS scheme or IOSS. All three schemes are reported in the same OSS return, but they cover different scenarios as explained below.

Which OSS scheme applies to your business?

Different VAT schemes apply for e-commerce businesses depending on the type of activity and country of establishment.

Businesses that are established in the EU can use the Union scheme and the Import scheme, whereas taxable persons who are not established in the EU can possibly use all three schemes, i.e. the non-Union, the Union and the Import scheme.

Non-Union OSS scheme

‍Who can use it? Non-EU businesses‍
Which activity is covered? Sales of services to non-taxable persons (private individuals)

Union OSS scheme

Who can use it?

EU businesses
Non-EU businesses
Deemed suppliers (e-commerce platforms)

Which activity is covered?

EU businesses: Distance sales of goods and services to non-taxable persons in another EU country.
Non-EU businesses: Only distance sales of goods.
Deemed suppliers: Distance sales of goods and domestic sales of goods.

Import OSS scheme or IOSS

‍Who can use it? Any business‍
Which activity is covered? Distance sales of goods imported from outside the EU in shipments below €150 value (an intermediary is required for non-EU businesses)

How does each OSS scheme work?

Although all transactions falling into any of the OSS schemes are reported in the same OSS return, each scheme is foreseen as a simplification for different activities:

Non-Union scheme: Allows non-EU businesses to register in a single country and report all sales of services to private individuals in a single VAT return. This scheme used to apply only to electronic services, but is now available to all services including entrance to events, transport services, etc.
Union scheme: Allows EU and non-EU businesses to report their sales of goods from an EU country to a final customer in another EU country in a single VAT return.
Import scheme (IOSS): Allows exempt imports of products that are sold to private individuals in foreign EU countries when the shipment is below 150€. The customs declaration is also simplified. If the value is above 150€, normal rules apply (full customs declaration and import paid at the border, a VAT registration may be required).