Now that the IOSS system is live since July 2021, companies that have received their IM number need to make sure submissions are made on time and accurately. Why? In this post, you will find out what the main IOSS-related penalties for non-compliant companies are. Check them out here.

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READ MORE: Union and Non-Union Schemes for IOSS Registration
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IOSS PENALTIES

Companies that fail to file their VAT-related activities to the EU tax bodies through IOSS three times will be put in a quarantine period. This means that they will not be allowed to commercialize with any EU final consumers for the calendar year, e.g. October to December 2021, following two additional years.

A quarantine period only applies when:

the taxable person persistently fails to comply with the rules relating to a special scheme – there is a quarantine period of 2 years following the (quarterly/monthly) return period during which the taxable person was excluded. He will be excluded from all schemes he is currently using and will remain excluded from using any of the three schemes for 2 years. He can only (re)register for a scheme once the quarantine periods of all schemes have elapsed.

Penalties will be applied if companies:

• deliberately or carelessly furnish incorrect returns;
• make an incorrect claim or declaration;
• fail to file a return due.

AVOIDING FAILURES

In order to avoid failures, it’s important to keep track of all transactions made in a calendar period and make sure that the VAT is properly calculated, as well as the information is correctly filed. As an intermediary, we will help our customers supervise the status of their filings on the IOSS portal. Apart from the IOSS intermediary services, we can also help companies properly calculate their taxes and duties through our tax calculator solutions.

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