European Union One Stop Shop for VAT Reporting
The European Union created a One Stop Shop to pay for your VAT when selling products in the EU. This was supposed to simplify the VAT reporting and payments for sellers. Unfortunately it has made it more complicated for some of those who chose to sign up for OSS.
Amazon Pan European Program
Amazon FBA sellers who are selling in the Pan European program will be registered for VAT in Germany, France, Italy, Spain, United Kingdom and you can elect to store goods in Poland and Czechia (Czech Republic). So you will have these 7 filing applications. You can choose to not store goods in Poland or Czechia but you will pay €0.25 more per fulfilment fee.
Since you are storing goods in these countries you will have to file a vat return in the respective countries. There is also the option to store goods in Sweden, which will add another VAT filing but might not be worthwhile given the size of the market.
Outside of these 7 countries, you may have filing obligations if you cross certain thresholds in other EU countries. Since the latest law implentation, the thresholds are €10,000. So once you sell €10,000 worth of products in the territory of Austria, you will need to register for VAT, make returns and payments to the Austrian government. As you can see, if you keep surpassing thresholds in the each EU country this will get expensive and cumbersome. This is where the OSS was to come in and help.
Does the OSS simplify VAT filings?
Whether the OSS is making your VAT filings simpler or more complicated will depend on where you make most of your sales. Most Amazon FBA sellers are not selling so much in other countries to cross the threshold. Since many EU countries don’t have their own Amazon marketplace, as in amazon (dot) and their country code. Customers use a local alternative to Amazon or shop on an Amazon marketplace in another country. So in this case, the previous structure of filings will suffice. If you start crossing more than one other EU country you are not vat registered in, you can consider the OSS filling option.
If I am registered for OSS do I still need to file in all of the PAN EU countries?
Registering for OSS doesn’t remove your filing obligations for the seven countries of the PAN EU. As long as you store goods in a country and sell those goods from the respective country, you will need to file a return for that country. You can read more about it here. So, you will just be adding an additional return if you opt in for OSS filing.
The best thing you can do is monitor your sales and if you see you are closing in on the thresholds of the EU countries that you are not vat registered in, and decide whether to do it or not.
Which country do you register in for OSS?
If you are operating an entity in the EU, you will register for OSS in that country. If you are not in the EU, then you can select the country that you do the most transactions and store your products in. Possibly Germany, but you can decide this.