VAT is the single biggest source of confusion — and expensive mistakes — for Amazon sellers in Europe. The good news: once you understand a few core rules, the system is actually designed to make cross-border selling simpler. Here’s the plain-English guide.
When do you need to register for VAT?
Two situations trigger a VAT obligation in the EU:
- You store stock in a country. The moment your inventory sits in a warehouse in, say, Germany or Poland (which Pan-European FBA does automatically), you need a local VAT registration there — from your first sale, with no threshold.
- You cross the EU-wide distance-selling threshold. For cross-border B2C sales, there is a single €10,000 per year threshold across the whole EU. Below it you can charge your home country’s VAT; above it you must charge the customer’s local VAT rate.
Because Pan-EU FBA spreads your stock across multiple countries, most sellers who use it end up needing several VAT registrations. If you want to avoid that early on, the EFN model keeps your stock in one country.
What is the One-Stop-Shop (OSS)?
Once you pass the €10,000 threshold you must charge many different national VAT rates — but you don’t have to file a return in every country. The One-Stop-Shop (OSS) lets you:
- Register for OSS in a single EU country
- Charge each customer their correct local VAT rate
- Report all your cross-border EU sales in one quarterly OSS return
- Pay once — the tax authority distributes the VAT to each country for you
Important: OSS covers cross-border sales. It does not replace the local VAT registrations you need in countries where you store inventory — those domestic sales are still reported locally.
What about imports? The IOSS
If you ship goods to EU customers from outside the EU with a value of €150 or less, the Import One-Stop-Shop (IOSS) lets you collect VAT at the point of sale and avoid your customer being hit with surprise import charges on delivery — which massively reduces failed deliveries and returns. For consignments over €150, normal import VAT and duties apply.
The most common VAT mistakes we see
- Turning on Pan-EU FBA without registering for VAT in the new storage countries — a fast route to a suspended account.
- Assuming OSS covers everything (it doesn’t cover local storage sales).
- Not keeping the required records — the EU requires you to keep detailed OSS transaction records for 10 years.
- Forgetting an EORI number, which you also need to import goods into the EU.
Frequently Asked Questions
What is the EU VAT threshold for Amazon sellers?
There is a single EU-wide distance-selling threshold of €10,000 per calendar year for cross-border B2C sales. Once your total cross-border sales to EU consumers exceed it, you must charge the customer’s local VAT rate from that point on. Storing stock in a country creates a VAT obligation there immediately, with no threshold.
Do I need OSS if I use Pan-European FBA?
You’ll likely need both. OSS handles your cross-border sales in one return, but you still need local VAT registrations in every country where Pan-EU stores your inventory, because those domestic sales are reported locally.
What is the difference between OSS and IOSS?
OSS is for goods already inside the EU sold cross-border to consumers. IOSS is for goods imported from outside the EU to EU customers with a value of €150 or less, letting you collect import VAT at checkout.
How often do I file an OSS return?
OSS returns are filed quarterly. You report all your cross-border EU sales and pay in your registration country, which then distributes the VAT to the relevant member states.
Not sure which VAT registrations you actually need for your setup? Book a free consultation and we’ll map it out with you. This article is general guidance, not tax advice — confirm specifics with a qualified VAT adviser.