The Import One Stop Shop, known as IOSS, is an EU system that lets you collect VAT at checkout on goods worth €150 or less shipped from outside the EU to consumers inside it, then report and pay that VAT through a single monthly return filed in one member state.1European Commission. VAT: New E-Commerce Rules in the EU Instead of registering for VAT in every country where your customers live, you register once, charge the buyer’s local VAT rate at the point of sale, and file one return covering all EU sales. Buyers receive their packages without surprise charges at the door.
What IOSS Covers
IOSS applies to consignments with an intrinsic value of €150 or less shipped from outside the EU directly to a consumer in any EU member state.2European Commission. VAT e-Commerce – One Stop Shop “Intrinsic value” is the price of the goods themselves, not including transport and insurance, unless those costs are bundled into the product price and not broken out separately on the invoice.3European Commission. Guidance on Import and Export of Low Value Consignments – Section: 1.3.1. Intrinsic Value Customs duties don’t count toward the threshold either.
Two things stay outside the scheme. Goods subject to EU-harmonized excise duties, meaning alcohol, tobacco products, and energy products, cannot go through IOSS at any price and must clear customs through standard import procedures.4Your Europe. Products Subject to Excise Duties: Rules on Payment And IOSS only applies to business-to-consumer distance sales. Sales to VAT-registered businesses fall outside the scheme and follow normal B2B import rules.2European Commission. VAT e-Commerce – One Stop Shop
Who Can Register
Three kinds of businesses are eligible: EU-based sellers, non-EU sellers, and electronic interfaces such as online marketplaces and platforms that facilitate qualifying sales.2European Commission. VAT e-Commerce – One Stop Shop
Non-EU Sellers and Intermediaries
EU-based sellers register directly in the country where they are established. A non-EU seller can register directly only if its home country has a mutual assistance agreement with the EU covering VAT recovery. Without that agreement, the seller must appoint an intermediary, which is a business or person established in the EU that handles IOSS obligations on the seller’s behalf.5Agencia Tributaria. Peculiarities in the Registration of the Import Scheme When Acting Through an Intermediary
The intermediary role carries weight. The intermediary becomes responsible for filing returns and paying the VAT due, and tax authorities can hold the intermediary jointly and severally liable alongside the seller for unpaid amounts where compliance problems have been identified.6Revenue Commissioners. Import One Stop Shop (IOSS) That liability is not automatic, but intermediaries are expected to conduct due diligence on the sellers they represent and to flag concerns to tax authorities.
Marketplaces as Deemed Suppliers
When an online marketplace facilitates the sale of imported low-value goods on behalf of a third-party seller, EU rules treat the marketplace as though it had bought and resold the goods itself. This “deemed supplier” status shifts the responsibility for collecting and remitting VAT from the individual merchant to the platform.2European Commission. VAT e-Commerce – One Stop Shop If you sell through a marketplace that has registered as a deemed supplier, the platform generally handles IOSS for those transactions and you do not need a separate IOSS registration for sales made through it.
How to Register
Every registrant selects a single Member State of Identification, the country whose tax portal will be used for registration, returns, and payments. For EU-based sellers, that is the country where the business is established. For non-EU sellers using an intermediary, it is the country where the intermediary is established.5Agencia Tributaria. Peculiarities in the Registration of the Import Scheme When Acting Through an Intermediary There is no choice of the most convenient portal; the rules assign it.
Registration is electronic through the chosen country’s portal. Forms vary a little between member states, but the core information is the same:8European Commission. Register to OSS
Once approved, the seller receives a unique IOSS VAT identification number, a 12-character code beginning with “IM,” which is automatically shared with customs authorities across all member states.7Agencia Tributaria. Import and Export Manual for Low Value Shipments – 3.1.3. IOSS VAT Identification Number That number is what tells customs to release packages without collecting VAT at the border.
Charging VAT at the Buyer’s Rate
Under IOSS, you charge VAT at the rate of the country where the buyer is located, not where you are based.9Your Europe. VAT Rules and Rates That means tracking which rate applies to each order. Standard VAT rates across the EU run from 17% in Luxembourg to 27% in Hungary, and many countries also apply reduced rates to specific product categories. The standard rate in any member state cannot fall below 15%, and reduced rates generally cannot go below 5%. Some goods qualify for reduced or even zero rates depending on the destination country, so identifying the correct rate for each product-and-country pair matters. Each member state publishes its current rates, and the European Commission maintains a database of rates across the bloc.
Monthly Returns and Payment
Each calendar month is a reporting period. You file one electronic return through your Member State of Identification’s portal covering all IOSS sales across every EU country for the month, broken down by country and by applicable VAT rate. The deadline for both filing and payment is the last day of the month following the reporting period, so January sales are due by the end of February.
A nil return is still required if you had no qualifying sales that month. A missing return is treated the same as a late one.
Payment goes to your Member State of Identification as a single lump sum in euros. That country then distributes each other member state’s share to the appropriate national treasury, so you never make separate payments to individual countries where you have customers.
What the IOSS Number Does at Customs
When a package enters the EU, the customs declaration includes the seller’s IOSS VAT identification number. Customs authorities check that number against a central database of valid IOSS registrations from every member state.10Agencia Tributaria. Import and Export Manual for Low Value Shipments – 3.1.3. IOSS VAT Identification Number If the number is valid, the package clears customs without any VAT being collected at the border. If the number is missing or invalid, customs collects VAT from the buyer before releasing the goods, which is precisely the situation IOSS is designed to prevent.
For buyers, that means no unexpected charges or handling fees from postal operators and carriers at the door. For sellers, it means fewer customer complaints, fewer abandoned orders, and no packages stuck in customs.
Records You Have to Keep
IOSS-registered businesses must retain detailed records of every qualifying transaction for 10 years from the end of the year in which the sale occurred, and that obligation continues even after leaving the scheme.11European Commission. Record Keeping and Audits in OSS The required data for each transaction includes:
- The member state where the buyer is located.
- The date of the supply.
- The VAT amount collected and the rate applied.
- Any deposits or partial payments.
- The information used to determine where the customer is established or resides.
Records must be available electronically and produced without delay when requested by the Member State of Identification or by any member state where goods were delivered. Failing to provide records within one month of a reminder counts as a persistent failure to comply and triggers exclusion from the scheme.11European Commission. Record Keeping and Audits in OSS
Losing Your Registration
A business can voluntarily leave IOSS by notifying its Member State of Identification. Involuntary exclusion happens when the seller no longer meets the conditions for the scheme, no longer makes qualifying sales, or persistently fails to comply with the rules.12European Commission. Deregistration to OSS / Exclusion Persistent non-compliance covers repeated failure to submit returns, pay VAT due, or make records available after reminders.6Revenue Commissioners. Import One Stop Shop (IOSS)
The consequences depend on the reason. If you are excluded because you no longer qualify or no longer make eligible sales, your IOSS number stays valid for up to two months to allow customs clearance of goods sold before the exclusion date. If you are excluded for persistent non-compliance, the number is invalidated the day after the exclusion decision is sent, and the business is barred from re-registering for IOSS or any other One Stop Shop scheme for two years.12European Commission. Deregistration to OSS / Exclusion An intermediary that is excluded takes down every seller it represents; those sellers lose their IOSS registration unless they quickly appoint a different intermediary.
If You Don’t Use IOSS
IOSS is optional. If a seller does not register, or a shipment carries no valid IOSS number, VAT still has to be collected. The EU offers two alternatives.13European Commission. Guidance on Import and Export of Low Value Consignments
Under the special arrangements, the postal operator, express carrier, or customs agent presenting the goods to customs collects the VAT from the buyer on behalf of the tax authority and remits the collected amounts by the 16th of the following month. This is common for low-value shipments with no IOSS registration, and it explains why buyers sometimes see an extra charge from their postal service before a package is released.
If neither IOSS nor the special arrangements are used, standard import rules apply. Customs collects VAT at the border using the destination country’s rate, and the goods are not released until it is paid. Under standard rules, the package can only be declared for release in the member state where the transport ends, meaning the importing country and the destination country must be the same. That path carries the most friction for sellers and, for buyers, delays and handling fees that on small orders can rival the price of the goods.