Many webshops are not familiar with new EU rules
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Many webshops are not familiar with new EU rules

  • 08 March 2021

On July 1, 2021 the new EU VAT rules on e-commerce will enter into force. This legislation applies to Dutch webshops with an annual turnover of € 10,000 or more from sales to individuals in EU countries outside the Netherlands. From July 1, the webshops will calculate the VAT of the customer's country. From then on, they must submit their returns in the individual EU member states or use the Union system. The Tax and Customs Administration is calling on webshop operators to prepare for the new EU rules.

The new EU legislation applies to entrepreneurs who sell and supply products from the Netherlands to private individuals and/or business customers who do not have a VAT number in other countries of the European Union. These are also referred to as 'distance sales'. This mainly concerns entrepreneurs with a webshop and traditional mail order sales. Are you a webshop owner and do you supply goods to individuals in other European Union countries? Then you have to deal with the new legislation VAT e-commerce. As of July 1, 2021, you will calculate the VAT that applies in the country of your EU customer. It is important that you take this into account when pricing your webshop. There is an exception for entrepreneurs with limited foreign turnover. Is your turnover in other EU countries less than € 10,000 per year? Then you can charge Dutch VAT.

Webshop owners who are affected by the new EU legislation have two options for their foreign VAT declarations. They choose to declare the VAT for each individual EU member state in which they have sold. Or they register for the Union scheme and thus for the new one-stop shop system of the Tax and Customs Administration. Those who register between April 1 and June 30 can submit a single VAT return for the months July through September (the third quarter). They make this declaration via the Dutch Tax Administration for the VAT on all sales to private individuals in other EU countries. The Tax and Customs Administration then forwards this declaration and payment to the Tax and Customs Administration of the other EU countries.

Tax authorities webinar

Many webshop entrepreneurs are not yet familiar with the new EU rules and what the changes mean for them. That is why the Tax Authorities are organising a webinar on Tuesday 20 April from 19:00 to 20:30 for Dutch webshop owners with private EU clients, so that they can prepare themselves for the new EU legislation. During the webinar the Tax Authorities will discuss the new VAT e-commerce legislation, the choices entrepreneurs have to make and other issues to take into account. For example, how they want to deal with the product price if the VAT rate differs in EU countries. The use of the Union Arrangement and the new import regime for packages from outside the European Union are also discussed. You can register for the free webinar via this link.

Not the only change

The change in VAT rules for Dutch EU webshops selling to individuals in the EU is not the only change. For example, as of July 1, the VAT exemption for packages with a value of up to €22 that are imported from countries outside the European Union will expire. In addition, platforms will be more responsible for the declaration and payment of VAT.

Click here for the e-commerce factsheet (Dutch only)

Source: Belastingdienst