Taxation and customs union

The Mini One Stop Shop

The Mini One Stop Shop

Did you find this content useful?

Guide to the mini One Stop Shop (MOSS)

This section provides information about how to register for the MOSS, how to declare and pay VAT in the MOSS, record keeping and audits of traders in the MOSS and how to leave the MOSS. This information is also compiled in a guide which is available in all EU languages.

 

 

Background - basic principles of the MOSS

 

The mini One Stop Shop came into force on 1 January 2015 and allows taxable persons supplying telecommunication services, television and radio broadcasting services and electronically supplied services to non-taxable persons in Member States in which they do not have an establishment to account for the VAT due on those supplies via a web-portal in the Member State in which they are identified. This scheme is optional, and is a simplification measure following the change to the VAT place of supply rules, in that the supply takes place in the Member State of the customer, and not the Member State of the supplier. This scheme allows these taxable persons to avoid registering in each Member State of consumption.

In practice, under the scheme, a taxable person which is registered for the mini One Stop Shop in a Member State (the Member State of Identification) electronically submits quarterly mini One Stop Shop VAT returns detailing supplies of telecommunications, broadcasting and electronically supplied services to non-taxable persons in other Member States (the Member State(s) of consumption), along with the VAT due. These returns, along with the VAT paid, are then transmitted by the Member State of Identification to the corresponding Member States of consumption via a secure communications network.

The mini One Stop Shop VAT returns are additional to the VAT returns a taxable person renders to its Member State under its domestic VAT obligations.

The mini One Stop Shop is available to taxable persons which are established in the EU (the Union scheme), as well as taxable persons which are not established within the EU (the non-Union scheme). Without the mini One Stop Shop, the supplier would be required to register in each Member State in which he supplies services to his customers. The mini One Stop Shop scheme is optional for taxable persons.

However, in choosing to use the mini One Stop Shop the taxable person must apply the scheme in all relevant Member States. It is not an optional scheme on an individual Member State basis.

For the good understanding, it is important to clarify some basic concepts:

  1. The concept of a taxable person in relation to the mini One Stop Shop

Under the Union scheme, a taxable person is a business (be it a company, a partnership or a sole proprietor) which has established its business or has a fixed establishment in the territory of the EU. The taxable person cannot use the mini One Stop Shop for supplies made in any Member State in which it has an establishment (business establishment or fixed establishment).

Under the non-Union scheme, a taxable person is a business (be it a company, a partnership or a sole proprietor) which has not established its business in the EU, nor has a fixed establishment there, and it is not registered or otherwise required to be identified for VAT in the EU. However, as from 1 January 2019, being identified or required to be indentified for VAT purposes in the EU does not prevent the taxable person from using the mini One Stop Shop.

  1. The concept of the Member State of identification

The Member State of identification is the Member State in which the taxable person is registered for using the mini One Stop Shop, and where it declares and pays the VAT due in the Member State(s) of consumption.

Under the Union scheme, the Member State of identification has to be the Member State in which the taxable person has established its business – i.e. where a company has its head office, or a sole proprietor has his place of business.

However, if the taxable person does not have its business establishment in the EU, the Member State of identification is a Member State in which the taxable person has a fixed establishment. Where the taxable person has more than one fixed establishment, that taxable person can choose any Member State in which it has a fixed establishment to be its Member State of identification.

Under the non-Union scheme, the taxable person is free to choose its Member State of identification. 

  1. The concept of the Member State of consumption

The Member State of consumption is a Member State in which the taxable person makes supplies of telecommunications, broadcasting or electronically supplied services to non-taxable persons. For the Union scheme, the taxable person can have neither its business establishment, nor a fixed establishment, in this Member State.  For the non-Union scheme, the taxable person can have no establishment whatsoever in that Member State.

In the non-Union scheme the Member State of identification can also be the Member State of consumption - i.e. the taxable person uses the mini One Stop Shop to account for and pay the VAT on supplies of telecommunications, broadcasting or electronically supplied services to customers in the Member State of identification. 

It is important to note that the supplies under the mini One Stop Shop have taken place in the Member State of consumption, not the Member State of identification or the Member State of establishment. As such, the rules applicable in the Member State of consumption to domestic supplies apply to supplies under the mini One Stop Shop (except for invoicing for which the rules of the Member State of identification apply as from 1 January 2019). These would include the rules relating to cash accounting and bad debt relief.

  1. The concept of a fixed establishment

For a fixed establishment to be considered as such, it should have a sufficient degree of permanence and a suitable structure in terms of human and technical resources to receive and use or to make the respective supplies. Simply having a VAT Identification number does not in itself mean that an establishment qualifies as a fixed establishment.

  1. The concept of the Member State of establishment

The Member State of establishment is a Member State in which a taxable person has a fixed establishment. A taxable person may have established its business in the Member State of identification, but at the same time have fixed establishments in other Member States. Supplies from these fixed establishments to Member States of consumption must also be included in the mini One Stop Shop VAT return.

The Member State of establishment cannot be the Member State of consumption – any relevant supplies in this Member State must be declared via the domestic VAT return of the fixed establishment.

6. The place of supply – threshold of EUR 10,000

The place of supply of telecommunications, broadcasting and electronically supplied services to non-taxable persons is in the Member State of the customer.

However, as from 1 January 2019, the place of supply is, exceptionally, in the Member State of the supplier where:

  1. the supplier is established or, in the absence of the establishment, has his permanent address or usually resides in only one Member State; and

  2. he supplies telecommunications, broadcasting and electronically supplied services to non-taxable persons located in another Member State; and

  3. these supplies do not exceed EUR 10,000 (without VAT) in the current and the preceding calendar year.

If all these conditions are met, the supplies are subject to VAT in accordance with the rules applicable in the Member State of the supplier. The mini One Stop Shop is not relevant in this situation.

Nevertheless, the supplier can opt to apply the Member State of the customer rule  and will in this case be bound by this decision for two calendar years. As soon as the threshold is exceeded, the place of supply is in the Member State of the customer (no option possible).