B2C Services and E-Commerce in Germany
Before selling your digital products in Germany or any other EU member state, registration with the One-Stop Shop (OSS) is required.
The EU VAT reform, implemented on July 1, 2021, impacts owners of e-commerce firms and service providers engaging in cross-border transactions within the EU or importing goods from non-EU countries.
Everything you need to know about VAT Registration, Returns, Tax Representation (if applicable), and your legal duties in Germany is conveniently located in our German VAT Guide!
B2C Services
Any product that is stored, transported, and used in an electronic format is referred to as a digital product. These are items or services that a consumer obtains via email, Internet download, or website login.
In order to sell your digital products in any other EU member state – including Germany – you must first register with the One-Stop Shop (OSS).
The VAT One Stop Shop (OSS) is an optional arrangement that allows you to account for VAT in one EU country. You may be eligible if you provide cross-border telecommunications, broadcasting, or digital services to a non-taxable person.
Among the OSS services are:
- website hosting
- supply of software
- access to databases
- downloading apps or music
- online gaming
- distance teaching
- accommodation services carried out by non-established persons
- Admission to cultural, artistic, sporting, scientific, educational, entertainment events, fairs & exhibitions
Selling into Germany?
The One Stop Shop eliminates the need for you to register with tax authorities in each EU country where you sell. Instead, you can register for VAT, file VAT returns, and make payments in a single location under the OSS framework. You must apply the rules of the OSS scheme to all your clients in all the EU nations to which you provide services or products.
Currently, there are two schemes in operation under OSS:
- The union scheme, which is available to enterprises that have been formed in the EU or that have at least one branch in an EU country.
- The non-union scheme is intended for enterprises that have not been created in the EU and do not have any branches in the EU.
The EU VAT reform, which took effect from July 1, 2021, affects e-commerce firm owners that conduct cross-border transactions within the EU or import items from outside the EU. The new VAT plan called One-Stop-Shop (OSS) allows enterprises to register for VAT and file quarterly VAT returns in a single EU country. Another concept, the IOSS or the Import One-Stop-Shop, is created for imported items.
For VAT on some digital products in the EU, the One-Stop Shop (OSS) model extends the previous Mini One-Stop Shop (MOSS) scheme. Both aim to simplify tax compliance and reduce the administrative load on businesses while increasing tax collection. Using the OSS scheme allows you to register for VAT and file your VAT returns within a single nation. If you have consumers in many countries, you no longer need to keep track of varied distance selling thresholds in each country. The annual EU distance selling thresholds was € 100,000 for Germany. Instead, an EU-wide €10,000 threshold will apply.
The OSS (One-Stop-Shop) is developed for EU enterprises selling goods to customers within the EU. In the EU, IOSS is meant for non-EU enterprises selling items worth up to € 150 to EU clients. In this case, ordinary VAT import regulations apply.
Last Updated: 16/01/2022
Disclaimer
The information provided by Global VAT Compliance B.V. on this webpage is intended for general informational purposes only. Global VAT Compliance B.V. is not responsible for the accuracy of the information on these pages, and cannot be held liable for claims or losses deriving from the use of this information. If you wish to receive VAT related information please contact our experts at support@gvc.tax
