Since My Duty Collect started submitting monthly VAT returns to the IOSS authorities, some questions have been raised regarding the exchange rate applied to transactions that require a currency conversion. Considering that the IOSS rules apply mostly to companies based outside the European Union, this topic can be of interest to those that submit monthly VAT reports. Based on the IOSS guidelines, this post covers one more VAT IOSS submission rule for you to stay compliant with the EU tax authorities.
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READ MORE: IOSS – Overpayments of VAT
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Exchange Rate
Where supplies have been made using a currency other than the euro, the exchange rate to be used is that published by the European Central Bank on the last day of the calendar month to which the VAT return relates. If there is no publication on that date, the rate on the next day of publication is to be used.
European Central Bank
The ECB website provides the exchange rates to be consulted on a daily basis. The reference rates are usually updated around 16:00 CET on every working day, except on TARGET closing days. They are based on a regular daily concertation procedure between central banks across Europe, which normally takes place at 14:15 CET.
In summary, the Import One-Stop-Shop return has to be made out in one single currency, which is the euro. Customers must use the exchange rate as published by the European Central Bank on the last date of the tax period.
If you are interested in more information about the Import One-Stop Shop system, 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 info@mydutycollect.com. We will be delighted to hear from you.
