One Stop Shop cross border VAT compliance

January 2012
Developing the One Stop Shop for cross border VAT compliance

One of the parts of the “VAT package” that was introduced back in 2010 was a harmonization of the VAT rules for intra-EU e-commerce services, to be introduced in 2015.

At this time, non-EU providers of online services that sell to EU individuals have to account for VAT at the rate of the customer’s country. From January 1, 2015, this rule will be extended to telecom services (including broadcasting) and will also apply to EU-resident service providers.

This means that from 2015 for example a Luxembourg online service provider will have to account for VAT in the country of the individual buyer. By way of simplification, the Luxembourg-based provider will be able to pay these VAT amounts on his Luxembourg VAT return.

The EU has signaled that they are making good progress towards implementation of these new rules, and released a ‘communication’ that provides details on various aspects of the plan.

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