How is your business going to deal with the EU tax policy change from the 1st July 2021?
From 1 July 2021, the EU will implement legislation which shifts the responsibility for collecting VAT for online purchases from sellers to marketplaces such as eBay or Hip Postcard in certain circumstances. (IOSS)
Taken from the HMRC website (UK). Published on the 13th May.
"Sales made by businesses through an online marketplace that is not registered for IOSS has the option to appoint an EU established intermediary to represent them and to account for VAT on their sales through IOSS. Alternatively, where an intermediary is not appointed and IOSS is not used import VAT will be due on importation as it is now"
I did ask Hip admin if they were going to register for IOSS. Still nothing to indicate if this is going to be the case. If it is left to individual businesses or sellers then the VAT charges will be picked up by the buyer before they can receive their order. Although complicated it is my understanding that these new rules apply regardless of the value of item(s) being sold. Low value sales will now come under this new VAT regime regardless of whether you are VAT registered in the UK. If I am wrong then someone please correct me.
Hip Postcard please communicate how you intend to support your sellers?. What are other sellers doing about this issue?.
Our decision is to cease sales to Europe due to the administrative, and extra cost implications of this policy change.
Taken from the HMRC website (UK). Published on the 13th May.
"Sales made by businesses through an online marketplace that is not registered for IOSS has the option to appoint an EU established intermediary to represent them and to account for VAT on their sales through IOSS. Alternatively, where an intermediary is not appointed and IOSS is not used import VAT will be due on importation as it is now"
I did ask Hip admin if they were going to register for IOSS. Still nothing to indicate if this is going to be the case. If it is left to individual businesses or sellers then the VAT charges will be picked up by the buyer before they can receive their order. Although complicated it is my understanding that these new rules apply regardless of the value of item(s) being sold. Low value sales will now come under this new VAT regime regardless of whether you are VAT registered in the UK. If I am wrong then someone please correct me.
Hip Postcard please communicate how you intend to support your sellers?. What are other sellers doing about this issue?.
Our decision is to cease sales to Europe due to the administrative, and extra cost implications of this policy change.
Comments
I have reached out to Hip also to inquire what they plan to do regarding the VAT issues. I did get a brief response saying they are looking into it. That was several days ago. I guess we'll see.
Thank you for bringing this to our attention. We have raised this to the relevant team. In the meantime, please review this help article:
https://help.hipecommerce.com/support/solutions/articles/14000112928-is-sales-tax-collected-automatically-
Best regards,
Anj
Hip Support