OSS and IOSS: Why EU VAT Compliance Matters for Global Sellers

If your business sells to customers in the European Union (EU), there's a good chance you're subject to EU VAT rules—even if you're based outside the EU. And if you’re not already using OSS or IOSS, you could be missing out on simplified compliance and exposing your business to major financial risks.

So, what are OSS and IOSS, and why should your business care?

OSS and IOSS: Why EU VAT Compliance Matters for Global Sellers

Understanding OSS and IOSS

The One Stop Shop (OSS) and Import One Stop Shop (IOSS) are EU schemes designed to simplify VAT collection and remittance for cross-border sellers and digital platforms.

• OSS is used by EU and non-EU businesses that sell goods or services across multiple EU countries. Instead of registering for VAT in each country, sellers can report all their sales through a single return in one EU member state.

• IOSS is specifically for non-EU businesses selling goods with a value under EUR 150 to EU customers. It allows VAT to be collected at the point of sale, ensuring a smooth delivery process for buyers.
  

If you're based in the UK, US, or any non-EU country and you ship orders under EUR 150 to customers in the EU, you are legally required to collect VAT at checkout. If you don’t, your customers will be forced to pay VAT when the goods arrive—resulting in delays, unexpected fees, and unhappy reviews.

Registering for IOSS means:

• VAT is charged during checkout—no surprises for the buyer.

• Delivery is faster and smoother, as goods clear customs seamlessly.

• You maintain compliance and avoid penalties that can be up to 180% of unpaid VAT.
  

The Role of an EU-Based VAT Intermediary

While the EU has simplified the process, non-EU sellers must register through an EU-based IOSS intermediary. This intermediary is responsible for handling your IOSS registration, filing VAT returns, and acting as your legal representative within the EU.

Partnering with an intermediary like LumioPro ensures:

• Fast IOSS registration with full guidance

• Hassle-free VAT reporting and payment

• Peace of mind knowing your business is compliant
  

Why OSS and IOSS Will Become Even More Essential

Today, IOSS applies only to goods under EUR 150—but the EU is working on new regulations. Soon, sellers may need to collect customs duties and VAT at the point of sale, even for higher-value goods. This will further streamline international sales—but only for those properly registered under schemes like IOSS and OSS.

Book a Free Consultation Today

Don't wait for penalties or frustrated customers to force your hand. Whether you sell via your own site or marketplaces like Amazon and Etsy, getting compliant with OSS or IOSS is easier than ever.

LumioPro is a trusted VAT intermediary that helps non-EU ecommerce sellers register, comply, and grow their business in Europe.

👉 Book your free consultation and find out if your business needs to register for EU VAT via IOSS or OSS.