FLEX. Fulfillment
IOSS, OSS, reverse charge, fiscal representative, distance-selling thresholds and more — EU VAT terms for non-EU sellers, defined without the jargon. 2026.
This glossary covers the EU VAT and tax terms non-EU sellers encounter when researching their obligations before their first sale into the European market. VAT terminology is one of the highest-confusion areas for US, UK and Asia-Pacific sellers: IOSS and OSS are easily conflated, reverse charge sounds like a refund, and fiscal representative means something different in VAT and customs contexts. Each entry gives a clean definition and links to the full guide where the mechanics are explained. The glossary captures the term; the linked page explains what to do about it.
Scheme Terms
VAT (Value Added Tax) is a consumption tax levied on goods and services at each stage of the supply chain in the EU and many other jurisdictions. In e-commerce, VAT is ultimately borne by the end consumer — sellers collect it from customers and remit it to the relevant tax authority. EU VAT rates vary by member state: Germany 19%, France 20%, Spain and Italy 21%, Poland 23%. Non-EU sellers selling goods to EU consumers are required to register for, collect and remit VAT in the relevant member states — either directly, or through the OSS or IOSS simplification schemes where eligible. EU VAT, IOSS and OSS explained covers the full VAT framework for non-EU Amazon sellers.
IOSS (Import One Stop Shop) is an EU VAT simplification scheme for sellers of low-value goods — goods valued at €150 or less — imported into the EU from outside the EU. Under IOSS, the seller registers in one EU member state, collects VAT from the customer at the point of sale at the destination country's VAT rate, and files a single monthly IOSS return covering all EU sales. The goods then clear customs VAT-free because VAT has already been collected. IOSS eliminates the surprise VAT charge that consumers previously encountered at delivery, which improves conversion rates and reduces parcel returns. Non-EU sellers must appoint an EU-established IOSS intermediary to access the scheme. EU VAT, IOSS and OSS explained covers IOSS eligibility, registration and the intermediary requirement.
OSS (One Stop Shop) is an EU VAT simplification scheme for sellers making cross-border supplies of goods or services to EU consumers from EU-held inventory. Under OSS, a seller registers in one EU member state and files a single quarterly OSS return covering all EU B2C sales — rather than registering for VAT separately in each country of sale. OSS does not cover imports from outside the EU (that is IOSS) or B2B sales (those use the reverse charge). For Amazon sellers using Pan-EU FBA — where Amazon holds inventory in multiple EU countries — OSS is not available as a substitute for local VAT registration in the countries where stock is held. EU VAT, IOSS and OSS explained covers OSS eligibility, the difference from IOSS, and how Pan-EU FBA affects scheme availability.
The OSS scheme has two variants. Union OSS is for EU-established businesses making cross-border B2C supplies of goods or services within the EU — they register in their member state of establishment and file one return for all EU sales. Non-Union OSS is for non-EU-established businesses supplying electronically supplied services (ESS) to EU consumers — they register in any EU member state of choice and file one return for all EU ESS sales. For non-EU sellers of physical goods, the relevant scheme is IOSS (for imported goods under €150) or local VAT registration plus potentially Union OSS once they have an EU establishment. Non-Union OSS does not cover physical goods. EU VAT, IOSS and OSS explained maps which scheme applies to which seller type.
Import VAT is the VAT charged at the point of EU customs clearance on goods imported from outside the EU. It is calculated as the applicable member-state VAT rate applied to the customs value of the goods (declared value plus import duty). For VAT-registered importers, import VAT is recoverable as input tax on the next VAT return — the cash flow impact is temporary. For non-VAT-registered parties, it is an irrecoverable cost. IOSS suspends import VAT for low-value consignments where VAT has been collected at the point of sale. Customs Procedure 42 defers import VAT for goods immediately transferred to another EU member state. Import VAT deferral under CP42 explains the main deferral mechanism for non-EU sellers importing into the EU.
Mechanism Terms
The reverse charge is an EU VAT mechanism that shifts the obligation to account for VAT from the supplier to the customer — specifically used for B2B transactions within the EU where both parties are VAT-registered. Instead of the supplier charging and remitting VAT, the customer self-assesses the VAT and both declares it as output tax and reclaims it as input tax in the same return — resulting in a net-zero cash impact for most businesses. The reverse charge is used for intra-community supplies of goods and services, and for certain domestic transactions in some member states. Non-EU sellers making B2B sales to EU VAT-registered businesses can apply the reverse charge, avoiding the need to register for VAT in the customer's country — provided they have a valid EU VAT number for the customer. EU VAT, IOSS and OSS explained covers reverse charge in the context of Amazon and e-commerce B2B sales.
An intra-community supply is the transfer of goods from one EU member state to another between VAT-registered businesses. The supply is zero-rated (VAT-exempt with input tax recovery) in the dispatching country and subject to acquisition tax in the receiving country — which the buyer self-assesses under the reverse charge. For Amazon sellers using Pan-EU FBA, Amazon's redistribution of inventory across EU fulfilment centres constitutes a series of intra-community supplies that the seller must account for in each country where stock is held. This is why Pan-EU FBA triggers VAT registration obligations in up to six EU member states. EU VAT, IOSS and OSS explained covers intra-community supply obligations for Pan-EU FBA sellers.
The place of supply rule determines which country's VAT applies to a transaction. For goods, the general rule is that VAT applies in the country where the goods are located at the time of sale or delivery. For B2C distance sales of goods, VAT applies in the customer's country once the seller exceeds the EU-wide distance selling threshold of €10,000. For services, the rules are more complex and depend on whether the customer is a B2C consumer or a B2B business, and the nature of the service. Understanding the place of supply is the first step in determining which country's VAT registration obligations apply to any given transaction. EU VAT, IOSS and OSS explained maps place of supply rules for common e-commerce scenarios.
The EU-wide distance selling threshold is €10,000 per calendar year in total B2C cross-border sales of goods and electronically supplied services across all EU member states combined. Below this threshold, a seller can apply the VAT rate of their own country of establishment to all EU B2C sales. Once the threshold is exceeded, VAT must be charged at the rate of the customer's country for each subsequent sale. In practice, any seller doing meaningful EU volume will exceed this threshold quickly — it is a low bar — and should register for OSS (for EU-established sellers) or IOSS (for imports of sub-€150 goods) rather than managing country-by-country VAT registrations. EU VAT, IOSS and OSS explained explains threshold monitoring and what to do when it is exceeded.
The low-value goods (LVG) rule refers to the EU's €150 customs value threshold for imported goods. Goods valued at €150 or less are exempt from import duty (but not from import VAT — VAT still applies). The LVG threshold is the dividing line that determines whether IOSS can be used: IOSS applies to goods with a customs value of €150 or less. Goods above €150 must clear customs with import duty and import VAT paid at the border under standard customs procedures — IOSS cannot be used, and the customer is typically responsible for import charges under a DAP Incoterms arrangement. EU VAT, IOSS and OSS explained covers LVG and IOSS eligibility in detail.
A deemed supplier is a marketplace — such as Amazon — that is treated as the VAT supplier for sales made through its platform, rather than the underlying seller. Under EU VAT rules introduced in July 2021, Amazon is treated as the deemed supplier — and therefore responsible for collecting and remitting VAT — for: (1) all B2C sales of imported goods valued at €150 or less made by non-EU sellers through Amazon EU, and (2) B2C sales of goods within the EU made by non-EU sellers regardless of value. This shifts the VAT collection obligation from the seller to Amazon for these transactions. Sellers remain responsible for VAT on B2B sales and on sales above €150 where they are the importer. EU VAT, IOSS and OSS explained covers exactly which transactions Amazon collects VAT for and where the seller obligation remains.
VAT registration is the process of enrolling with a member state's tax authority to collect, report and remit VAT on taxable supplies made in that country. A non-EU seller must register for VAT in an EU member state when: they hold inventory in that country (FBA warehousing triggers registration in each country of storage), they exceed the distance selling threshold and choose not to use OSS, or they make domestic B2B sales in that country. VAT registration gives the seller a country-specific VAT number, which must appear on invoices for B2B sales and is required for intra-community transactions. Pan-EU FBA typically requires VAT registration in up to six EU member states. EU VAT, IOSS and OSS explained maps VAT registration triggers for Amazon sellers by fulfilment model.
A VAT number is the unique identifier issued to a VAT-registered business by a member state's tax authority. It consists of a two-letter country prefix followed by a numeric or alphanumeric string — for example, DE for Germany, FR for France, PL for Poland. A VAT number is required to: issue VAT-compliant invoices for B2B sales, apply the reverse charge on intra-community supplies, and access the OSS or IOSS schemes. Amazon requires sellers to provide valid VAT numbers in Seller Central for each country where they hold FBA inventory. B2B buyers validate suppliers' VAT numbers through the EU's VIES system (VAT Information Exchange System) to confirm the number is active and the reverse charge applies. VAT compliance partners — 1StopVAT and SimplyVAT via the FLEX. partner network — handle VAT registration and ongoing filing across EU member states.
Role Terms
A fiscal representative (in the VAT context) is an EU-established entity appointed by a non-EU business to fulfil VAT obligations on its behalf in a specific member state. Some EU member states — including France, Italy and Spain — require non-EU businesses to appoint a fiscal representative to register for VAT; others, including Germany and the Netherlands, allow direct registration by non-EU businesses without a fiscal representative. The fiscal representative is jointly and severally liable for the VAT obligations of the non-EU business in that country — meaning they share responsibility if VAT is underpaid. This liability exposure is why fiscal representative services charge a premium and perform due diligence on the businesses they represent. Note: fiscal representative in the VAT context is a separate role from a customs fiscal representative. VAT compliance partners lists fiscal representative and VAT registration services available through the FLEX. partner network.
A tax agent is a professional — typically a tax adviser, accountant or VAT compliance firm — appointed to manage VAT registration, filing and compliance obligations on behalf of a business. Unlike a fiscal representative, a tax agent typically does not take on joint liability for the business's VAT debts — they act as agent rather than as a liable party. In member states where fiscal representation is not required, non-EU sellers commonly use a tax agent for ongoing VAT compliance. Tax agent services include VAT registration, preparation and submission of VAT returns, EC sales lists, Intrastat declarations and correspondence with tax authorities. VAT compliance partners — 1StopVAT and SimplyVAT — provide tax agent services across EU member states for non-EU Amazon sellers.
A non-established taxable person (NETP) is a business that is registered for VAT in an EU member state but is not established there — meaning it has no fixed establishment (office, warehouse or other permanent place of business) in that country. Non-EU sellers who VAT-register in EU member states to comply with FBA or distance-selling obligations are NETPs in those countries. NETP status affects which procedures are available for VAT registration, whether a fiscal representative is required, and how certain transaction types are treated for VAT purposes. Being an NETP does not change the core VAT obligations — the seller must still register, collect and remit VAT correctly. EU VAT, IOSS and OSS explained covers NETP status and its practical implications for non-EU Amazon sellers.
Related Guides & Services
Deep guides and services behind these VAT terms:
- EU VAT, IOSS and OSS explained — the canonical guide covering all VAT scheme mechanics, registration triggers and filing obligations for non-EU Amazon sellers
- Import VAT deferral under CP42 — Customs Procedure 42, import VAT deferment and border VAT mechanics
- Customs clearance for online sellers in Europe — import VAT at the border and EORI requirements
- VAT compliance partners — 1StopVAT and SimplyVAT for VAT registration, fiscal representation and ongoing filing
Located in the center of Europe, FLEX. Fulfillment supports non-EU sellers with FBA prep, inbound logistics and VAT compliance coordination across Germany, Poland and France — connecting sellers with the right VAT registration and filing partners for each EU market.
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