From 1 July 2021, the new EU rules will come into force. This will affect e-commerce transactions with final consumers as recipients, specifically in the intra-Community distance sales regime and in imports of low-value goods.
On 28th April, RD 7/2021 of 27th April was published, transposing European Union directives, which regulate the VAT treatment of e-commerce and establish the rules for the taxation of supplies of goods and services that are sent or provided by entrepreneurs or professionals from another Member State or a third country or territory to final consumers. In this way, such transactions are subject to VAT in the Member State of arrival of the goods or of establishment of the recipient (principle of taxation at destination), establishing the one-stop-shop system as the standard procedure for the management of VAT on e-commerce.
One of the main novelties of the new regime is that the national thresholds of each country disappear: the supplier of distance sales of goods will charge VAT at destination with the following exceptions:
- That the supplier is established in a single territory of the European Union
- That the total amount of services provided electronically and distance sales of goods to final consumers does not exceed the threshold of 10,000 euros in the current year and in the previous one.
This measure is accompanied by an expansion of the one-stop-shop regime to simplify VAT registrations (also called the One Stop Shop – OSS system). It is a mechanism that makes it possible to avoid registration and formal obligations in each and every one of the Member States where the company’s operations are carried out. This allows the company to make a single registration and file a single declaration and entry in the country of registration that includes:
- intra-community sales of goods at a distance,
- supplies of services to EU consumers and
- domestic supplies provided by interfaces in respect of non-EU suppliers.
On the other hand, the exemption on imports of low-value goods that was applied until now for goods of less than 22 euros is abolished, in such a way that, imports of goods that do not benefit from the special regime, must settle the VAT on import, regardless of its amount.
In order to apply these new regimes on distance sales, a new Form 035 census declaration and a new self-assessment, Form 369, have been approved.