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Problems with new EU import VAT scheme

15 June 2021
Issue: 4796 / Categories: News

A new EU VAT scheme intended to make life easier for UK businesses importing low-value goods into the EU after 1 July 2021 (shipments of less than 150 Euros) has encountered an unexpected stumbling block.

Businesses can apply to register for the import one stop shop (IOSS) with an EU tax authority of their choice but must appoint an intermediary accountant based in the EU to act for them. This is an extra cost for the UK seller and many EU accountants are reluctant to carry out this role because they are liable for any outstanding VAT returns and payments of the non-EU business.

It was expected that UK businesses would not need to appoint EU based intermediaries because of the trade deal agreed with the EU on 24 December. But that is not the case.

The IOSS is an...

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