The VAT Mini One Stop Shop (MOSS) is an optional program offered by HMRC, the UK’s tax, payments and customs authority. VAT MOSS allows businesses that supply telecommunications, broadcasting or electronic services to non-taxable consumers in the EU – in countries where they do not have an entity – to account for the VAT due on those supplies via a web portal. These services are always taxed in the country where the customer resides – regardless of whether the customer is a business or consumer – and regardless of whether the supplier is based in the EU or outside. Without MOSS, businesses selling these supplies would be obligated to register for VAT, file returns and make payments in each customer’s individual country. MOSS replaced the VAT on Electronic Services (VOES) scheme on January 2015 as a simplification measure to reduce the burden and cost to businesses in fulfilling their VAT obligations.
Is MOSS relevant for my business?
Consider the following questions:
- Do you supply digital services ‒ broadcasting, telecommunications or e-Services ‒ where the service is automated? Some examples of these services include: video on demand, supply of websites, downloaded apps, music downloads, gaming, e-books, databases, anti-virus, software, online auctions, distant teaching or web-hosting.
- Do you charge for these services?
- Do you have customers in other EU Member states?
- Are any of your EU customers not VAT registered businesses?
- Do you sell your e-Services only through your own website?
If you answered YES to all of these questions, then VAT MOSS is relevant for your business.
You must register for VAT MOSS or you will be required to register for VAT in each of the EU countries where you have non-business customers, and submit multiple VAT return declarations. When opting for the MOSS online platform, EU-based businesses should register in the country where they are established or maintain their headquarters. Non-EU businesses may utilize the MOSS system in the country where they maintain a fixed entity. Business VAT returns and payments should be submitted through the MOSS portal every quarter. The VAT payments received through MOSS will be automatically distributed to the relevant tax authorities – effectively alleviating the business’ administrative burden.
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