On July 1, 2021, the European Union countries are making adjustments to VAT and DUTY regulations related to postal shipments. These changes are referred to as IOSS (the Import One-Stop Shop) and changes to how VAT is declared and collected. This means that it is more likely for the recipient to be charged VAT and DUTY for packages received.
From 1 July 2021, the value added tax (VAT) exemption for the importation of goods with a value not exceeding EUR22 will be removed. As a result, all goods imported to the EU will be subject to VAT. In the past, any shipment with a value under EUR22 was exempt from VAT charges. Additionally, HT codes and product values will be required for all packages, but Elevate has always required these so there shouldn't be much of a change for you.
If you do not want the recipient to pay the VAT and associated collections charges IOSS can be chosen. The Import One-Stop Shop (IOSS) was created to facilitate and simplify the declaration and payment of VAT for distance sales of imported goods with a value not exceeding EUR 150. This new IOSS option essentially makes a DDP solution to the entirety of the EU.
IOSS process is not obligatory. You can choose to ship using Duty At Place (DAP) meaning there will be no change in the current processes of the Postal customs clearance and the recipient may pay VAT. However depending on each country, a Postal service charge of €5- €22 ($6.03-$26.55) may be leveed on each package payable to the delivering postal authority.
If you choose IOSS please contact us and we can help you start the process. There are few steps and you must register in one of the 27 EU countries for a VAT Identification #. Additionally, if your business is not based in the EU, you will need to appoint an EU-established intermediary to fulfil your VAT obligations under IOSS. Elevate is working with several intermediaries to help facilitate this payment and more information can be provided upon request.
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