Guide · VAT
Updated: · 7 min read · By Agnieszka Saladra, Certified Accountant
Do you sell goods to consumers from other European Union countries and do not know where to account for VAT? We explain what the VAT OSS procedure is, when the EUR 10,000 threshold appears, and how the quarterly returns work. We also show how Luno-Group handles these settlements for you.
In short
VAT OSS (One Stop Shop) is an EU procedure that simplifies accounting for VAT on the sale of goods and certain services to consumers from other European Union countries. Instead of registering for VAT in every country you ship parcels to, you account for everything in one place - through the Polish tax office.
Selling goods shipped to consumers in other EU countries is, in the regulations, intra-Community distance sales of goods (WSTO). As a rule, VAT on such sales is due to the country where the buyer lives. Without OSS, this would mean having to register and file returns in each of these countries separately - a costly and time-consuming obligation.
OSS solves this problem: a single registration, a single quarterly return, and a single payment cover sales to all EU countries. That is why the procedure is so popular in e-commerce.
The key figure is the EUR 10,000 threshold (PLN 42,000) of total annual sales to consumers across all EU countries - counted together, not separately for each country. It covers the value of distance sales of goods and of all telecommunications, broadcasting and electronic services (TBE) provided to consumers from other EU countries, in amounts net of tax.
As long as you do not exceed this amount, you may tax sales to other EU countries with Polish VAT - just like domestic sales. This is a convenient solution for smaller shops that are only beginning to sell abroad.
It is worth keeping track of this threshold during the year, because you need to register for OSS sufficiently early. If you exceed the limit without registering, some of the sales will have to be accounted for in the buyer's country under general rules. Ongoing turnover monitoring in online accounting helps a great deal here.
In Poland, you register for the EU OSS procedure electronically by filing the VIU-R form. You submit the application through the Ministry of Finance (the e-Tax Office, the podatki.gov.pl portal), with no visit to the office. The country of identification for a Polish entrepreneur is Poland.
Registration itself is only the beginning - next come quarterly returns and the obligation to apply the correct rates for each country. This is a stage where it is easy to make a mistake, which is why running OSS is worth entrusting to an experienced accountant.
Under the OSS procedure, you account for VAT on the basis of the quarterly VIU-DO return. You file it by the end of the month following the quarter - the deadline does not shift even when the last day falls on a Saturday or public holiday.
This is the greatest challenge of OSS: you have to correctly determine the VAT rate applicable in the buyer's country for a given product. Rates vary and change regularly. We prepare and file VIU-DO returns, keep the required records, and watch the deadlines - while decisions about the sales model remain on your side.
OSS and IOSS are two different procedures, although both simplify VAT accounting in cross-border sales. The difference lies in where the goods come from.
The monthly rhythm of IOSS fits well with models that have a large number of small orders, typical among other things of some dropshipping. The choice between the procedures depends on where your goods are located at the time of sale - we will show you how each one works, and you make the decision with full understanding.
OSS applies primarily to online shops and entrepreneurs who ship goods to consumers (B2C sales) in other EU countries and have exceeded the EUR 10,000 threshold. The procedure is voluntary, but for most sellers it is far more convenient than multiple registrations abroad.
If you sell through a platform such as Allegro, Amazon, or Etsy, in some situations the platform becomes a deemed supplier and accounts for VAT on some of the B2C transactions itself. This does not, however, release you from your own obligations - you still have to correctly record the remaining sales and understand which transactions the platform accounts for and which you account for.
Importantly, OSS does not replace local VAT registration where you store goods (e.g. using FBA models) or carry out domestic sales in a given country. In practice, for many sellers this works out as a mix: local registrations plus OSS for qualifying cross-border sales. This situation is worth analysing individually.
Cross-border sales in e-commerce is an area where a costly mistake is easy to make - from missing the threshold, through an incorrect VAT rate for a given country, to a late return. Each of these errors can mean tax arrears abroad.
At Luno-Group, an experienced accountant looks after your settlements, not an app alone. We combine the convenience of online accounting with real human support from someone who knows the regulations and will answer your questions - in Polish or in English.
Sources and legal basis
The threshold is EUR 10,000 (PLN 42,000) of total annual distance sales of goods and telecommunications, broadcasting and electronic services (TBE) to consumers across all EU countries, counted together and net of tax. Once you exceed it, you account for VAT at the buyer's country rates - through the OSS procedure or by registering for VAT in the individual countries.
You register electronically by filing the VIU-R form through the e-Tax Office on the podatki.gov.pl portal. An application filed through this channel is sealed with the seal of the Head of the National Revenue Administration (KAS) and does not require a qualified electronic signature - a qualified signature is only needed when filing through the e-Deklaracje channel. After registration you receive confirmation of participation in the procedure.
You file the OSS return (VIU-DO) quarterly, by the end of the month following the quarter. The deadline does not shift when it falls on a non-working day. You report all amounts in euros, and you pay the VAT for the whole quarter in a single transfer - including when there were no sales.
OSS covers the sale of goods located in the EU, shipped to consumers in other EU countries, with quarterly returns. IOSS applies to the import of goods from outside the EU in consignments up to EUR 150, with monthly returns and VAT collected from the customer already at purchase.
It depends. In some situations the platform becomes a deemed supplier and accounts for VAT on some of the B2C transactions itself. This does not, however, release you from your own obligations on the remaining sales or from local registration where you store goods. Each model is worth analysing separately.
Yes, using OSS is voluntary and you can register even before exceeding EUR 10,000. This can be convenient when you know in advance that foreign sales will grow - from the start you then account for VAT at the buyer's country rates through a single return.