Attention to online retailers and online marketplace operators. With the implementation of the second stage of the so-called Value Added Taxes (VAT) digital package, fundamental changes will be made to VAT from April 1, 2021 and from July 1, 2021.
In a letter dated April 1, 2021, the Federal Ministry of Finance (BMF) summarized the essential content of the VAT digital package in a 35-page letter and announced changes to the so-called VAT application decree.
The second stage of the VAT digital package includes in particular:
- Changes in mail order business
- Inclusion of operators of electronic interfaces in fictitious supply chains
- Expansion of the one-stop shop (OSS EU procedure)
- Expansion of the one-stop shop (OSS non-EU procedure)
- Introduction of an import one-stop shop (IOSS)
- Introduction of a special regulation for the payment of import sales tax
- Abolition of the EUR 22 customs exemption threshold
With effect from July 1, 2021, the determination of the place of delivery in the mail order regulations will be fundamentally changed. In the case of distance sales in the European Community, the place of delivery is in principle relocated to the place where the item is at the end of the transport or dispatch to the purchaser.
With effect from July 1, 2021, operators of electronic marketplaces will be liable to pay VAT for certain goods deliveries via an electronic marketplace for the sales tax incurred in the European Community, the supply chain “entrepreneurs to marketplace operators” and “marketplace operators to consumers”.
From April 1, 2021, entrepreneurs who are not resident in the European Community can notify the Federal Central Tax Office (BZfSt) of their participation in the one-stop shop – non-EU regulation electronically.
Domestic companies and entrepreneurs based in the European Community can also electronically report their participation in the one-stop shop – EU regulation from April 1, 2021 to the Federal Central Tax Office (BZfSt).
An optional import one-stop shop (IOSS) was introduced with effect from July 1, 2021 for distance sales of goods imported from third countries with a value of up to EUR 150. Participation in the IOSS can be reported electronically to the Federal Central Tax Office (BZfSt) from April 1, 2021.
To curb VAT fraud, the so-called duty-free limit of EUR 22.00 will be abolished on July 1, 2021. This means that foreign mail order companies will no longer be preferred in the future.
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