A short guide to the EU One Stop Shop (OSS) for VAT

This can cover a business that provides SaaS (software as a service), is an online seller or provides an electronic interface within the EU.

To make things simple, it will allow you to register VAT electronically for doing business within the EU and have everything in one place, instead of registering for VAT in up to 27 EU countries. You can also declare and pay VAT that’s due on supplies of goods and work with the tax administration in any country you supply to - you can even communicate in your own language.

Non-EU companies selling e-services or digital products MUST register for EU OSS BEFORE starting to trade. You also need to register for the scheme if your business provides certain supplies of goods and your goods are worth more than £8,818 a year to consumers in the EU. You can find the full list and more information on this on the gov.uk website.

How do you register for EU OSS?

Before you register you will need to tell HMRC your UK registration number as well as a name and permanent place for your business. You must also apply to register by the 10th day of the month after your first supply of business. If you apply after this, your registration won’t take effect until the first day of the next calendar quarter.

The process of registering is quite easy. Log in to your government gateway with your businesses ID and password and find the OSS section in your account. You should have your log in details from when you registered for UK VAT. Make sure you also have your bank identifier code (BIC) and account number (IBAN) to hand.

Please be aware that this process is no longer available post-Brexit but we can

Union and Non-Union OSS

If you’re assuming that Union OSS and Non-Union OSS is based on whether you’re in the EU or not, you’re not far from the truth. The two definitions are based on the types of transactions and businesses that are eligible to use each type of tax return. To keep things simple, we’ve created a breakdown for you so you can see where your business might fit.

Union EU OSS is designed for EU and non-registered businesses who sell goods to customers within the EU. Examples of this include, transport, digital products, telecommunication or the supply of restaurant and catering services on board ships, trains and aircrafts.

Non-Union OSS is designed for non-EU businesses who are providing services similar to the above.

EU businesses are required to register for tax in their home country whereas a business outside of the EU might choose to only register in the country where they trade. This must correlate to where stock is held - so if you do business in France, you must register in France.

However, if you’re a non-EU business, you can register in whatever country you choose and would therefore fit into the Non-Union OSS category.

What if I’m a SaaS business?

If you’re a SaaS business based in the UK and provide digital products to customers in the EU, you need to register for Non-Union OSS. Even services such as having a website with a ‘buy now’ button and having minimal human intervention is classed as providing an e-service.

If your business just uses the internet or software to communicate with customers in the EU, that might not mean you are supplying an e-service. You can find the full list of what is classed as an e-service here. We understand that this can feel confusing and very overwhelming, especially if you’re a new business.

To get help unravelling the complexities of EU OSS and VAT, get in touch with David Masih, our client relationship partner. David can explain how our financial management services can benefit your business during a no-obligation chat today. Call 03330 067 123 or email info@onthegoaccountants.co.uk.

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