Starting from the 1st of July 2021, new regulations (called “VAT e-commerce package”) will be in force regarding VAT for cross-boarder B2C eCommerce transactions.

These rules will impact all cross-boarder B2C activities, meaning that if you are selling goods to customers located in the European Union, you will be impacted by these new regulations.

This new package of laws was meant to modernise and improve equality within the European Market and consists of three main points:

1. Abolition of the VAT exemption for packages entering EU up to €22

Starting from the 1st of July, all goods imported to Europe will be subject to VAT.

This means that if you are selling products from warehouses based in non-European countries (for example you are dropshipping from China), your transactions will be now covered by this disposition, therefore you will have to pay VAT.

uDroppy will handle this operation for you by charging VAT according to the destination country during your checkout phase on the uDroppy platform.

Starting from now, every time you will fulfil an order directed to a European country, you will see an additional import indicated as Import Duties in the order details section.

By collecting and paying this tax at the point of sales, your products will go through a fast customs release and reach your final customers without them having to discover the presence of any hidden costs. Preserving therefore customer experience.

2. The introduction of the Import One-Stop Shop (IOSS)

The IOSS is the new electronic portal that allows merchants that sell products from third countries to Europe to declare and pay VAT to the authorities of their choice preventing this import from being charged to their customers.

As we have already mentioned, all uDroppy subscribers are exempted from having to perform any operations on such system.

3. The introduction of the VAT One-Stop Shop (OSS)

This new interface will exclusively benefit EU-Based businesses. In particular it allows merchants to declare an pay VAT for goods sold throughout the EU. Thanks to this system it will be possible to register for VAT in a single European Member State and sell to all European countries without having to register for VAT in every single country.

Check out our video to know more:

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