Since the Import One Stop Shop system went live on 1 July this year, many businesses from all over the world have got registered for their respective schemes. Since the IOSS registration is not mandatory, companies can opt not to join the new VAT system to report their taxable activities. In this post we will show you 5 disadvantages of not having an IOSS registration. Check it out below:
READ MORE: My Duty Collect is Now an IOSS Intermediary
1- Be Tax Registered in Different Countries
In case businesses opt not to use IOSS, they will have to get a VAT registration number in each individual EU member state where their final consumers are based. If a company has customers based in 27 different EU countries, it’s mandatory to be tax registered in all the 27 member states. From a time and financial management perspective, it can be an absolute headache.
2- Language Barrier
Currently only Ireland speaks English as a first language in the European Union. If businesses need to be VAT registered in all 27 EU member states, it implicates in going through legal procedures in different languages. It can become a financial risk once private translation services may be needed from time to time for specific legal processes.
3- Different Submission Systems
EU Countries’ tax submission systems are not unified or integrated. It means that businesses will have to manage to learn and educate their staff to use the VAT submission portals. It simply means more money and time with training sessions to upskill teams.
Currency conversion can also be a headache if companies don’t use the IOSS system. Once not all EU member states are part of the Eurozone, VAT needs to be reported in the currency where final consumers are based. Again, it can be an inconvenience, considering exchange rates and bank charges issues.
5- Sporadic Submission Feedback
If submitted individually, reports will receive distinct feedback from the countries’ tax authorities at distinct timelines. It can be an issue if we consider customer report deadlines.
Don’t wait any longer to get your IOSS registration in place. You can appoint us as your intermediary company and we will be responsible for registering your business and also doing your monthly VAT submissions. If you are interested in our solution, subscribe to our blog and visit our website and LinkedIn page for more updates. You can also reach out to us by sending a message to email@example.com. We will be happy to hear from you.