How to start selling in Europe through Shopify and make the most of tax simplifications and why choose E.Finaxit Srl
Introduction
Are you a US company that wants to expand your online sales in the European Union? Are you wondering what tax procedures you need to follow to do this easily and effectively? The good news is that the EU has introduced new rules that can greatly simplify the process with E.Finaxit Srl. Find out how to register for VAT, what you need to know about IOSS and how to avoid tax problems with your European business.
1. Do you have to register for VAT in the EU if you sell to private consumers?
If you are selling online in the EU, yes, you do have to deal with VAT. But don’t worry, the process is simpler than it sounds! VAT in Europe is a consumption tax calculated on the added value of goods and services. It applies to all goods and services bought and sold for use and consumption in European countries. VAT therefore does not apply to goods exported or services sold to foreign customers. Imports into Europe are taxed. Here is the crucial question: When must you register? VAT registration is mandatory if you exceed a certain threshold of sales. For example, if you sell in France or Germany, you may have to register. But if you sell throughout the EU, ask E.Finaxit for details.
2. How can I simplify EU-wide VAT registration (OSS)?
There is a solution for you: the OSS (One-Stop-Shop). But you may be wondering: what exactly is the OSS and how does it work? In a nutshell, OSS allows you to register in only one EU country, and declare VAT for all your online sales throughout the EU. Imagine having only one point of contact for your sales in all 27 EU Member States. With E.Finaxit this is possible.
3. What about imported products under EUR 150?
If you sell imported products in the EU with a value of less than 150 euros through Shopify, you may benefit from the IOSS (Import One-Stop-Shop) system. But you might be wondering: what does this system consist of and why should you care? With IOSS, you can declare and pay VAT on sales of imported goods within a single registration, without having to deal with customs problems or delays in shipping.
Imagine not having to pay VAT at the time of importation and settling everything before shipment. Wouldn’t that be a huge simplification?
4. How does IOSS work and what are its advantages?
The IOSS is a very simple system, but there are a few key steps to follow:
- Registration in only one EU Member State: As a US company, you can register for IOSS in only one EU country. You do not need to do this in every member state where you sell.
- Applying VAT in the sales price: When you sell your products, you have to apply the VAT rate of the EU country where the IOSS has been registered. Thus, the consumer pays the VAT at the time of purchase, and you manage everything through the IOSS registration.
- Monthly or quarterly VAT returns: Every month (or quarterly, depending on local regulations) you have to file a VAT return through the IOSS system and pay the VAT you have collected.
What impact would a system that simplifies tax management have on your business?
The IOSS offers numerous advantages, including:
- Simplifying VAT declarations: Register once and handle all your EU sales without having to deal with the bureaucracy of each country.
- Better customer experience: VAT is already included in the sales price, preventing consumers from having to pay additional costs on delivery. This reduces frustrations and improves their shopping experience.
- Simplified customs procedures: There are no surprises at customs! VAT has already been collected, avoiding delays and unexpected costs when importing goods. E.Finaxit will take care of the registration and all the paperwork so you can focus on your business and your Shopify shop.
Conclusion
Who is E.Finaxit? E.Finaxit is the consultancy company that handles the registration and VAT returns of online sellers throughout Europe. An experienced team that provides tailor-made advice and will not only handle registration, but also VAT declarations in the various EU countries.
Are you ready to simplify your expansion in Europe?