With the booming e-commerce industry, many companies are eyeing new markets beyond the usual hotspots in Southeast Asia and Korea. And what better place than Europe, with its vast and diverse consumer base, to tap into the world of online shopping? But before diving in, it’s important to be fully prepared and ensure that your online store and products comply with local regulations. That’s why ePlus teamed up with our trusted overseas partner, Vatglobal, to share the latest insights on the unique features of the European Union Value-Added Tax (VAT) and the newest regulations in the EU. With this knowledge, you’ll be on your way to expanding your reach and boosting your sales in the exciting world of e-commerce.
Vatglobal is a globally renowned VAT tax technology company that specializes in serving e-commerce businesses worldwide. With advanced software technology, Vatglobal provides comprehensive VAT tax solutions, including value-added tax registration, compliance reporting, and real-time information updates. If you’re interested in expanding your online store business to Europe, you can trust ePlus for your logistics needs while leaving the complex tax procedures to our reliable partner, Vatglobal. This way, you can focus on developing your business while knowing that your VAT tax matters are in good hands.
European Union Value-Added Tax (VAT)
When it comes to online shopping in Europe, it’s important to understand the European Union Value-Added Tax (VAT). This is a tax on consumer spending that’s charged by businesses registered for VAT when selling goods within EU countries. The tax is then paid to the local tax authorities through reporting. If you’re a Hong Kong-based online store selling goods in Europe, you may need to register for a local VAT number and pay the VAT tax. The VAT threshold varies by country and takes into consideration factors such as whether you have local inventory. Don’t let VAT catch you off guard – stay informed and ahead of the game!
Revision of European Union Value-Added Tax Regulations (July 2021)
1）Removal of €22 import VAT exemption
The revised regulations have a significant impact on non-EU e-commerce businesses selling to consumers (B2C). As of July 1st, 2021, all goods imported to EU countries, regardless of their value, are subject to VAT. This means that under the new regulations, goods with a value below €22 will no longer be exempt from VAT.
2）Launch of Import One Stop Shop (IOSS) platform
To simplify the B2C consumer shopping process and ensure more efficient customs clearance, the European Union has launched the Import One Stop Shop (IOSS) platform. IOSS is not a strict regulation, but an advanced system for VAT reporting and payment, allowing non-EU sellers to sell goods to EU customers and simplify their VAT responsibilities. Since July 1st, 2021, if the value of the shipped goods is below €150, IOSS can be used to facilitate the sender’s VAT reporting and payment.
3）Sellers Shoulder the Burden, Consumers Rejoice!
As of July 1, 2021, sellers throughout the supply chain, from manufacturers to distributors to retailers, will now be responsible for paying the Value-Added Tax (VAT) instead of just consumers. VAT will no longer be a burden on your shoulders as a consumer!
e+Solutions isn’t just a logistics provider – we’re here to help e-commerce businesses thrive. We understand that expanding your business can be overwhelming, which is why we offer complete solutions to make the process smoother. With our extensive resource network, we can handle everything from international shipping to customs clearance and local warehousing and distribution. No matter where your business is located, we’ve got you covered!
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Encountering any e-Commerce logistics troubles? e+Solutions can help you! From goods storage and management, handling and packaging, to arranging last-mile, we can meet all your logistics needs while allowing you to operate an online store easily!
