The OSS procedure is an EU solution that simplifies VAT settlement for companies selling goods and services across multiple EU countries by eliminating the need for multiple VAT registrations. Introduced in July 2021, it allows centralized tax reporting and payment via a single online portal. This article explains what the OSS procedure is, who can use it, how to register, how often to file returns, how to make payments, and what penalties apply for non-compliance.
What is the OSS procedure?
The OSS procedure is a system that allows businesses to settle VAT on cross-border B2C (business-to-consumer) sales in a single EU Member State, referred to as the “Member State of identification.” OSS covers:
- Sales of services (e.g., digital, telecommunication) to consumers in the EU
- Intra-community distance sales of goods (WSTO) above the €10,000 annual threshold
- Imports of goods valued up to €150 (import scheme – IOSS)
It replaces the previous MOSS system by expanding its scope to more transactions.
Who can use the OSS?
The OSS procedure is available to:
- EU businesses: VAT-registered companies in the EU conducting B2C sales in other EU countries (Union scheme)
- Non-EU businesses: Companies without an EU establishment, selling goods or services to EU consumers (non-Union or import schemes)
- Online platforms: Entities facilitating online sales, considered “deemed suppliers” for VAT purposes
Eligibility requires either exceeding the €10,000 cross-border sales threshold or opting in voluntarily.
How to register for OSS
To register for the OSS procedure in Poland, a company must:
- Complete and electronically submit form VIU-R to the Second Tax Office Warsaw-Śródmieście
- Receive confirmation upon successful verification
- Registration becomes effective from the first day of the quarter following the quarter in which the application was submitted
- After registration, the taxpayer gains access to the OSS portal (in Poland, via the e-Tax Office)
The process typically takes 2–4 weeks, and registration is effective from the start of the next quarter.
OSS declaration frequency and deadlines
Companies using OSS must file quarterly VAT returns (form VIU-DO) by the end of the month following the end of each quarter (e.g., Q1 deadline is April 30). Returns must be filed electronically, even if no transactions occurred during the quarter (i.e., a “zero return”).
OSS Payments
VAT payments under the Union, non-Union (OSS), and import (IOSS) schemes follow special procedures. After submitting the VAT return, the taxpayer receives a unique reference number (UNR). VAT must be paid in EUR to the account of the Second Tax Office Warsaw-Śródmieście, which provides separate accounts for domestic and foreign payments.
Penalties for OSS non-compliance
Penalties for OSS violations (e.g., late returns, unpaid taxes) are imposed by the consumer’s country, according to their laws. Repeated failures to file (three consecutive missed returns despite reminders) lead to a 2-year exclusion from OSS. In Poland, penalties for not filing OSS returns range from PLN 430 to 86,000 (per Article 56 §4 of the Fiscal Penal Code), and late VAT payments incur interest (16.5% annually in 2025). Penalties vary across the EU—for example, up to €25,000 in Germany for administrative violations. OSS exclusion forces the company to register for VAT in each consumer’s country.
In summary, the OSS procedure significantly simplifies VAT settlement for cross-border businesses but requires strict adherence to deadlines and local VAT rates. Professional support and software help avoid penalties and optimize operations
