VAT Rule Changes for eCommerce Sellers to the EU

Effective from 1st July 2021, the EU is introducing reforms to the VAT arrangement for e-commerce sellers and marketplaces, including the ending low-value import VAT exemption.

The €22 VAT exemption on small parcels being imported into the EU for delivery to consumers is being withdrawn. This exemption meant that non-EU sellers had an advantage over EU sellers.

Instead, VAT must be charged at the point-of-sale for consignments not exceeding €150. Therefore, VAT must be applied to online sales at the point of sale, at the rate applicable in the buyer’s country.

VAT must be declared and paid via a new submission, the ‘Import One Stop Shop’ (IOSS). This will create a more efficient fast-track with the aim of achieving a quick and easy customs clearance.

About 26,000 ecommerce sellers, slightly more than 10 per cent of the UK sector, will have to register for VAT for the first time under the new EU “one-stop shop” (IOSS) system

In January, the UK imposed similar VAT rules on EU companies, with many consumers been hit with unexpected charges to receive goods from the EU, so we know how much of an impact it can have and now UK sellers are facing the same issues.

Ultimately, if you are an online UK seller of low value products to the EU, you must register for IOSS and implement this new process by 1st July.

To register for IOSS, please see following link – and select the EU country in which you wish to register.


For further information regarding IOSS, please see the UK Government link below –