As soon as you sell goods or digital services to consumers in other EU countries, VAT is charged at the rate applicable in the buyer’s country — and there are twenty-seven different rates across the European Union. OSS and IOSS eliminate the need to register in every country: you register once in Estonia, submit a single return and make a single payment, and the Estonian tax authority distributes the amounts amongst the relevant countries.
The difficulty does not lie in the registration itself – the application can be submitted via e-MTA in a matter of minutes. The difficulty lies in what comes next: sales must be correctly allocated by country and tax rate, reports from marketplaces and payment gateways must be collated, refunds and discounts must be accounted for, and the quarterly tax return must be submitted by the last day of the month following the quarter. Errors here go unnoticed until an audit — and then they surface across several jurisdictions at once.
We determine which scheme you need – and whether you need one at all – register your company under OSS or IOSS, and manage your reporting: breaking down revenue by country, reconciling marketplace data, making adjustments, and monitoring deadlines.
| Topic | Practical explanation |
|---|---|
| What is OSS? | A special scheme for declaring VAT on sales to consumers in the EU via a single country of registration |
| What is IOSS | Special scheme for imported parcels valued at up to €150 when sold to consumers in the EU |
| Threshold | €10,000 per year for total distance sales and digital services to EU consumers |
| Below the threshold | Estonian VAT may apply; above this threshold, the purchaser’s country’s VAT applies |
| Where to register | e-MTA: ‘Registers and enquiries’ → ‘Registration’ → registration as a user of the OSS/IOSS special schemes |
| OSS period | Quarter; return due by the last day of the month following the quarter |
| OSS deadlines | 30 April, 31 July, 31 October, 31 January |
| IOSS period | Month |
| Non-EU companies | An intermediary registered in Estonia is required for IOSS |
| Intermediary number | The intermediary is assigned a separate number with the prefix IN; a user of the scheme may have only one intermediary |
| Standard KMD declaration | OSS does not replace it: domestic turnover and deductions are declared as usual |
| Late submission | Interest is charged from the first day, with no reminders |
If you have any questions, our managers are always on hand and ready to help! If you’re not sure whether you’ve exceeded the €10,000 threshold, please send us your sales report and we’ll calculate it for you free of charge.
These are two different schemes for two different situations, and they are regularly confused.
The OSS (One Stop Shop) applies when the goods are already in the EU or the service is provided electronically, and the buyer is a consumer from another EU country. You charge VAT at the rate applicable in the buyer’s country, but declare everything in a single quarterly return via Estonia. The scheme is divided into an EU and a non-EU scheme, depending on where the seller is established.
IOSS (Import One Stop Shop) applies to the sale of goods imported from outside the EU, provided the value of the consignment does not exceed €150. The seller charges VAT at the time of sale, and the parcel clears customs without any additional tax being levied at the border. For the buyer, this means no unpleasant surprises on receipt; for the seller, it means predictable delivery and fewer returns.
The €10,000 threshold is calculated as the total of distance sales of goods and digital services to consumers across all EU countries combined, rather than for each country individually. Estonian VAT may be applied up to the threshold; above it, the buyer’s country’s VAT must be applied. Registration with the OSS is also possible on a voluntary basis before the threshold is reached: this is often simpler than keeping track of when the threshold is exceeded during the year.
The application is submitted via e-MTA in the ‘Registers and Enquiries’ section and requires neither a fee nor a visit. This is precisely why many sellers register themselves — only to discover a quarter later that they have nothing to fill in on the declaration.
What goes wrong in practice:
Practical conclusion: the question is not ‘how to register’, but ‘how to organise data uploads so that the quarter is closed in an hour rather than a week’. We set this up from the outset.
A thorough analysis saves more than the scheme itself.
The special regime is an extension of standard accounting, not a replacement for it. When a single provider handles both the accounts and the OSS, the data in the quarterly return automatically matches the data in the KMD and the annual report, rather than after a year-end reconciliation.
| Period | Deadline |
|---|---|
| First quarter (January–March) | 30 April |
| Second quarter (April–June) | 31 July |
| Third quarter (July–September) | 31 October |
| Fourth quarter (October–December) | 31 January of the following year |
The OSS return must be submitted electronically only; there is no paper form. For IOSS, the reporting period is one month. Important: returns must be submitted even for periods with no sales. Late payment interest is charged from the first day after the deadline, without any warnings or reminders.
A seller without an establishment in the European Union cannot register with the IOSS independently — an intermediary established in the EU is required. In Estonia, a person may act as an intermediary if they are listed in the Commercial Register, registered as an Estonian VAT payer, solvent, of impeccable reputation and have no tax arrears. The intermediary first registers themselves and receives a separate number with the prefix ‘IN’, and then registers the scheme user.
There are two points that are rarely mentioned. Firstly, a scheme user may have only one intermediary — it is possible to change them, but this is a separate procedure, not simply a matter of flicking a switch. Secondly, the intermediary is liable for the user’s obligations to the tax authorities; therefore, a reputable provider carries out its own checks on the client and reserves the right to refuse. An offer to become an intermediary ‘no questions asked and within 24 hours’ is a cause for concern, not celebration.
A user of the special regime is obliged to maintain a register of transactions broken down by country and to retain it for the prescribed period, providing it on request to the tax authorities of any country where buyers were located. In practice, this means that transaction data from payment systems and marketplaces must be retained in its original form, rather than just in the accountant’s summary report. It is often impossible to retrieve this data after two years, particularly if you have changed platforms or tariff plans.
From 2025, an exemption scheme for small businesses will come into force in the EU, allowing a company from one EU country to benefit from VAT exemption in another, provided that both national and pan-European thresholds are met. For small sellers, this is sometimes more advantageous than the OSS, but the schemes are mutually exclusive for the same supplies, so the choice between them needs careful consideration. We’ll assess both options using your figures.
Please describe your business model: what you sell, where you dispatch from, to which countries, and via which platforms. Within one working day, we’ll let you know which regime applies, whether registration is required at this stage, and how much it will cost to maintain the necessary records.
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