Online merchants based in the EU who sell goods to other EU member states via Amazon or other online market operators can use the one-stop-shop procedure (OSS) for VAT return. The OSS is new in this area. Finally, the EU member states introduced the OSS uniformly after a six-month postponement on 01.07.2021. This means that German online retailers at Amazon can now declare and pay all sales taxes incurred in other EU countries collected via the Federal Central Office for Taxes. However, there are a number of conditions. In particular, the minimum annual turnover of EUR 10,000 in other EU countries as well as the restriction of this turnover threshold to end customers and equal entrepreneurs is important here.

On 01.07.2021, the EU member states introduced innovations in the cross-border taxation of goods and other services. In this context, of course, all those online merchants who sell their goods to EU countries via online platforms such as Amazon or eBay are affected in particular. On this occasion, we dedicate this article to the new one-stop-shop procedure (OSS) for trading via Amazon and other online marketplaces.

OSS is therefore a new taxation procedure that is applied within the EU to record the associated VAT when providing cross-border services. The OSS represents an alternative to the previous regulation for the registration and payment of VAT. Until now, you had to register and pay the sales tax in another EU member state in that country if your sales exceeded the delivery threshold applicable there. For this purpose, you had to register separately for tax purposes in each country in which this condition applied. It was also irrelevant whether goods were sold via their own online shop or offered to an online marketplace operator such as Amazon. However, if the sales values were below a delivery threshold, you had the freedom to tax the sales according to your own national laws. In this case, the sales tax was paid in their own country.

The OSS now simplifies this bureaucratically excessive procedure. In principle, you can now register the sales tax, which is incurred in all other EU member states, with the Federal Central Office for Taxation (BZSt) and transfer it collected. The BZSt then carries out the division of the individual VAT amounts according to the submitted OSS tax return on the basis of the stored data of the online merchants (name of the company/entrepreneur, VAT identification number). In this way, each Member State in which goods were sold via Amazon, for example, during the relevant tax period receives the sales tax due to it. The VAT rates applicable for this purpose naturally correspond to the tax rates applicable in the Member States.

Since online merchants who also sell their goods abroad on Amazon, for example, now have the opportunity to participate in the OSS, Amazon now asked them precisely to fulfill their own obligations as marketplace operators. Therefore, the online merchants involved with Amazon must henceforth submit their VAT identification number and proof of their registration to the OSS. Otherwise, their accounts will be blocked. Previously, the presentation of a certificate according to § 22f UStG was required.

The introduction of the OSS and thus the impact it has on online retail via Amazon are due to the implementation of the second stage of the EU’s VAT digital package. In particular, §§ 18i, 18j and 18k UStG are subject to fundamental changes. Sections 18i and 18k of the UStG provide for a special taxation procedure comparable to the OSS for the provision of certain services. § 18j UStG, on the other hand, contains the legal requirements that apply to the actual OSS (so-called "EU regulation"). They apply to intra-Community distance selling, to the provision of other services by companies established in the EU which they carry out in third countries and to supplies within a Member State involving a significant electronic interface. The latter case thus also characterizes the use of the OSS for online merchants who use Amazon or other online platforms when selling goods.

In order to participate in the OSS as a retailer working at Amazon, you have to meet some requirements. It does not matter whether the company is based in Germany or abroad. As an entrepreneur, you have to exceed a turnover threshold of EUR 10,000 per year when trading with end customers in other EU countries in order to participate in the OSS. Trade with other entrepreneurs based in other Member States is therefore irrelevant. However, there are also exceptions. This is because entrepreneurs who do not themselves provide services subject to VAT and are therefore excluded from the VAT deduction are treated as end customers. For example, this is the case with sales tax small business owners. But doctors and other doctors who do not provide sales tax services are also excluded.

If these sales are below the sales threshold in the previous year as well as in the current year, you must either follow the sales tax rules applicable in Germany or register for sales tax purposes in other EU countries. In the latter case, the sales tax incurred there is then normally paid. However, the latter also means that you have to register for VAT in all EU countries where you provide services subject to VAT there. Therefore, it should probably be more advantageous if you opt for sales taxation in Germany.

However, if you sell goods via Amazon to end customers in the EU as an online retailer based outside the EU, Amazon as the operator of the electronic interface assumes the obligation to pay VAT in the respective EU member state. Amazon itself can also use the OSS to handle all sales tax obligations. The turnover threshold of EUR 10,000 is insignificant.