OSS/IOSS Number in Estonia

OSS (OneStopShop) and IOSS (ImportOneStopShop) are special procedures to simplify the declaration and payment of turnover tax. OSS is used for the provision of various services, including digital services, by businesses within the EU. IOSS is used to simplify declaration and turnover tax procedures when importing goods from third countries into the EU. OSS (OneStopShop) is a mechanism that allows businesses in the European Union to simplify the declaration and payment of turnover tax when providing various services. This approach significantly simplifies business processes for companies, especially those that provide services across the borders of various EU countries. The OSS system allows companies to pay taxes in one country (usually their country of incorporation), which eliminates the need to register and pay taxes in each country where services are provided. This significantly reduces the administrative burden for entrepreneurs and contributes to lower tax compliance costs.

ImportOneStopShop (IOSS) is a system designed to simplify the declaration and payment of turnover tax when importing goods from third countries into the European Union. This special IOSS procedure is introduced primarily to simplify the process for the end consumer. The buyer of goods receiving goods from third countries using this procedure does not have to provide customs documents. The seller collects turnover tax at the time of placing the order and declares it on a monthly basis in a special IOSS declaration. The IOSS order simplifies the tax obligations also for the entrepreneur: he can register as a user of this system in only one country and declare and pay turnover tax only in that country, instead of having to pay turnover tax on imported goods in each country to which the goods are imported.

The overall aim of OSS and IOSS is to simplify tax procedures and increase transparency for businesses within the EU. These mechanisms help reduce bureaucracy, lower costs and improve the environment for doing business within the European Union.

If a company prefers not to use a special procedure, it can always register as a turnover taxpayer in each EU country where tax liabilities arise from the sale of goods or services to the final consumer.

Fulfilment of tax obligations

In order to fulfil the tax obligations as per the requirements of OSS and IOSS returns, it is important to follow the prescribed timelines and filing procedure. OSS returns are filed quarterly, while IOSS returns are filed monthly. The obligation is to file the declaration by the end of the month following the reporting period.

From the beginning of July 2021, a legislative amendment requiring online shop owners to collect turnover tax on sales to end consumers came into force. This means that e-shop owners must now account for tax liabilities not only in their own country, but also in the country of the customer.

We are here to help you understand all of these requirements and ensure that your tax obligations, including filing the appropriate returns and paying your taxes, are properly fulfilled. Feel free to contact us for advice and assistance in this important matter.

Assistance in registering an OSS/IOSS Number in Estonia

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Submission of the OSS declaration

A taxpayer who uses the special OSS procedure is obliged to electronically file a declaration of turnover under the special OSS procedure (hereinafter OSS declaration) for each tax period; it is not possible to file an OSS declaration on paper. The tax period for the application of the special OSS procedure is a quarter, the OSS declaration is submitted by the last day of the month following the quarter.

Deadlines for filing the OSS declaration:

I quarter (1 January – 31 March) – 30 April
II quarter (1 April – 30 June) – 31 July
III quarter (1 July – 30 September) – 31 October
IV quarter (1 October – 31 December) – 31 January of the following year

Data to be reported in the OSS declaration

The list of data to be provided in the OSS declaration is set out in Annex III of the European Commission’s (EC) implementing regulation (EU) 2020/194.

Among other things, the OSS declaration shall include the following data, which shall be provided by the State of registry to all States of consumption identified in the declaration:

the number of registration as a turnover tax obliged person applying the special procedure;
the Member States of the Community to which the goods or services covered by the special procedure have been transferred;
sales tax rates by state;
the taxable value of goods disposed of to another Member State from Estonia by intra-union distance selling and the amount of turnover tax payable on these goods by state, in euros;
the taxable value of goods alienated to another Member State of the Community from another Member State of the Community by way of intra-Union distance sale and the amount of turnover tax payable on those goods, by State, in euros;
the taxable value of the goods of a person of a non-Community state sold via an Internet trading platform, if the delivery of the goods to the purchaser starts and ends in the same Community Member State (Article 4 (1)³ of the Sales Tax Act) and the amount of turnover tax payable on these goods by state, in euros;
the taxable value of services rendered and the amount of turnover tax payable on these services by state, in euros;
total taxable value of goods and services and total turnover tax payable on these goods and services by state, in euros;
the total amount of turnover tax payable, in euros.

Termination of the OSS special order and notification of changes

If a person no longer provides services covered by the special procedure and no longer sells remotely within the Community, or if he or she has changed his or her activity and/or registration data (change of place of business or permanent place of activity, no longer valid registration number as sales tax liability, etc.), this must be notified no later than the tenth day of the month following the month of the change.

Termination of the application of the special OSS procedure by the tax administrator

The tax administrator has the right to terminate the special procedure if:

the person has indicated that he or she no longer sells goods or provides services subject to the special procedure;
the person has not sold goods or provided services subject to the special procedure for a period of two (2) years;
the person does not fulfil the conditions for the application of the special procedure;
the person has repeatedly failed to fulfil the requirements established for the application of the special procedure.

Failure to comply shall be considered repeated if at least one of the following circumstances occurs:

despite reminders, no special procedure declarations were filed for 3 quarters;
despite reminders, the amount of sales tax has not been paid (unless the unpaid amount is less than 100 euros for each quarter);
the person applying the special procedure, after the tax administrator’s request and one month after the reminder sent by the tax administrator, has not provided electronically the information specified in Article 43(15) of the Sales Tax Act (information to be stored).

Submission of an IOSS declaration

A taxpayer who uses the special IOSS procedure is obliged to electronically file a declaration of turnover for each tax period when applying the special IOSS procedure (hereinafter IOSS declaration).

The tax period for applying the special IOSS procedure is a calendar month and the IOSS return is filed by the last day of the month following the taxation period.

Special procedure turnover declarations can only be filed if a valid special procedure application has been submitted to the tax administrator. Each declaration is linked to a specific application. To file a declaration in the e-MTA environment, select: Taxes – Declarations on turnover tax of special procedures for e-commerce and services (OSS/IOSS). The types of declarations for which special procedure applications have been submitted will appear for selection. If the user has submitted only one special order declaration, then the system will pre-fill the declaration type.

When applying, the taxpayer should take into account that the special IOSS procedure can only be used for distance selling of goods imported from non-European Union states, the value of which does not exceed €150 and which are not excisable goods. In addition, another thing to consider is that, in order to consider the sale of imported goods as distance selling, the goods must be physically delivered from outside the European Union (from non-Community States or territories) directly to the buyer. If the goods delivered from outside the European Union are sent to a customs warehouse in a European Union member State, from where they are subsequently delivered to a customer who is not registered as liable to turnover tax, such transactions are not subject to IOSS, as the goods were already in the territory of the European Union at the time of dispatch to the customer.

Each return is given a unique reference number which can be used to pay the tax, in which case the claim is paid immediately as the money is credited to the prepayment account. Payment can also be made by prepayment account reference number, in which case payment will be made automatically when due.

Data to be reflected in the IOSS declaration

The list of data to be provided in the IOSS declaration is set out in Annex III of the European Commission (EC) implementing regulation (EU) 2020/194, as is the list of data to be provided in the OSS declaration.

The following data shall be provided in the IOSS declaration:

the registration number issued to the person for the application of the special order;
the Member State of the Community to which the goods are delivered;
total taxable value of goods by state, in euros;
sales tax rates by state;
total amount of goods by state, in euros;
the amount of turnover tax payable by state, in euros;
the total amount of turnover tax payable, in euros.

The data declared in the IOSS declaration (taxable value, tax rate, turnover tax) are presented by state of consumption and the total amount of turnover tax payable is also declared.

Depending on the selected state of consumption, the electronic system offers the user possible types of turnover tax rates (standard, reduced) and turnover tax rates (%), but the user has the possibility to enter a turnover tax rate that differs from the proposed rates. The amount of turnover tax is calculated automatically on the basis of the taxable turnover. Rates of turnover tax in other Member States of the Community

The IOSS special order user charges turnover tax to the purchaser at the time of sale.

Termination of the IOSS Special Procedure and notification of changes

An intermediary or a person who applies a special IOSS procedure has a duty to notify the Tax and Customs Board in the following cases:

he has ceased activities that fall under the special order;
its activities change in such a way that it no longer fulfils the conditions for the application of the special procedure, for example, the state of registration changes due to a change in the location of the fixed place of business (Article 43 (1) and (2)¹ of the Sales Tax Act );
he’s changing the information on the application.

Changes in data and cessation of activities covered by the special procedure must be notified by the tenth day of the month following the month in which the change occurred.

Termination of the application of the special IOSS procedure by the tax administrator

A special procedure applicant shall be excluded from the registry if at least one of the following circumstances occurs:

a person notified the tax administrator that it was not engaged in the remote sale of imported goods;
a person has not made a distance sale of imported goods for two years;
the person does not fulfil the conditions for the application of the special procedure (Article 43 (1) and (2)¹ of the Sales Tax Act);
a person has repeatedly failed to fulfil the requirements established for the application of a special procedure. Repeated failure to fulfil the requirements for the application of a special procedure is set out in Article 43(24)¹ of the Sales Tax Act.

FREQUENTLY ASKED QUESTIONS

IOSS number is special orders of electronic commerce and services.

The introduction of the special procedure for taxation of e-commerce and services will make it easier for entrepreneurs to fulfil their turnover tax obligations in another EU Member State. An entrepreneur who has chosen the special procedure may declare the turnover generated in another EU Member State and pay turnover tax to the Estonian Tax and Customs Board.

From 01.07.2021, the special procedure applies to the distance sale of goods within the Community, the distance sale of goods within the Community via Internet trading platforms, and to services whose turnover takes place in another EU Member State (special procedure OSS). Also from 01.07.2021, the special procedure applies to distance selling of goods imported from non-Community Member States and to distance selling of goods through online marketplaces (special procedure IOSS).

IOSS – the declaration is filed once a month for the previous month

OSS – the return is filed once a quarter for the previous quarter.

All tax liabilities are calculated on the basis of the submitted declaration and paid to the Estonian Tax Administration.

OSS (ONE STOP SHOP) is a special turnover tax treatment for services or goods that you sell to your customers through your website or through a marketplace (e.g. Amazon, Etsy) mainly to individual buyers. In this case, in the case of sales of goods, the goods are sold to the end customer an EU individual or a company without a European VAT number from a warehouse located in any of the EU countries.

In Estonia IOSS / OSS numbers are issued by the Tax and Customs Board.

The difference lies in how the goods reach the final buyer. If the goods are first delivered to a warehouse in the EU and then sent from there to the final buyer in the EU, then OSS applies. If the goods are not sent to a warehouse in the EU, but go, for example, from China directly to the final buyer in the EU, then IOSS applies.

If the seller does not use the OSS regime, he usually has the obligation to register and pay VAT in each EU country in which the goods or certain services are consumed; or in case of sales of goods imported by a non-EU resident from outside the EU in the amount of up to 150 Euros to final buyers in the EU (the obligation to pay VAT is incurred by the buyer, in the OSS regime this obligation can be assumed by the seller).