HMRC opens Import One-Stop-Shop portal for e-commerce sales NI to EU
The UK’s HMRC has launched 1 March 2024 its own full portal for the EU’s Import One-Stop-Shop IOSS. This enables UK or other non-EU businesses with a UK VAT number to report Northern Ireland – EU VAT charged on import consignments to consumers not exceeding £135 (approx. €150). This also applies to deemed supplier marketplaces IOSS.
This means affected merchants can close any IOSS in other EU states, and potentially save on fiscal representation costs, and switch to HMRC’s IOSS portal.
This HMRC scheme is necessary following Brexit, which included Northern Ireland remaining in the EU VAT union and Single Market for goods. It enables Northern Ireland-based sellers to continue to sell to EU consumers via the 2021-launched IOSS (see below) as though located in any of the EU 27 member states.
To use the HMRC IOSS scheme the goods being sold must:
- be located in a country outside the EU and Northern Ireland at the point of sale;
- have a consignment value of £135 or less; and
- be sold to a consumer in the EU or Northern Ireland.
Sellers of goods to Northern Ireland consumers from the rest of the UK (‘Great Britain’) should be careful to only include these transactions in their UK VAT return – not the IOSS.
The new HMRC VAT IOSS scheme is yet not available for intermediary registrations. HMRC will give more information when this is available.
Separately, similar online sales of goods consignments imported to UK consumers attract UK VAT at 20% in the checkout. This was imposed 1 January 2021.
July 2021 – withdrawal of low-value consignment VAT exemption; IOSS introduction
IOSS was introduced on 1 July 2021 as part of the EU e-commerce package. From this date, import VAT on eligible consignments not exceeding €150 must be charged in the online checkout instead of at customs.
To simplify the reporting of this, the EU introduced IOSS as a single registration and monthly return reporting regime covering low-value consignment sales to any of the EU member states. Online retailers are now able to select any member state to register for IOSS, and commence monthly reporting.
For non-EU sellers, many member states require the appointment of a fiscal representative. This is a local tax agent that will often share VAT liabilities with the seller, and therefore are typically costly to appoint.
