Changes in distance selling to German consumers after July 1st, 2021
At the beginning of July 2021 new regulations concerning e-commerce trade to Germany and all other countries of the EU were introduced.
The changes stem from the so-called e-commerce package which will revolutionize the current approach to international trade powered by e.g. online shops. For this reason, the Polish tax law must be adjusted to the EU requirements.
The e-commerce package: main objectives
The new package aims at gaining more control over e-commerce trade. Its main objective is to facilitate VAT settlement processes regarding goods sold and services provided to customers from different European countries, and therefore, standardising existing tax laws (which differ depending on the country of destination). The e-commerce package will also help with company competitiveness of businesses active in the EU against businesses outside the EU, as well as limit untaxed goods.
What changed after July 1, 2021?
e-commerce traders will no longer use the term mail order sales. Instead, a new term which encompasses all e-commerce-related processes will be introduced – intra-Community distance sales. But the biggest change to come is the introduction of VAT OSS (One Stop Shop), and the necessary adjustment of internal processes to the new requirements regarding e.g. taxes and invoicing.
The introduction of the eCommerce package means:
the end of VAT exemption on the import of small parcels,
tax payers’ obligation to settle VAT via a designated interface,
a new template for VAT-R registration application,
a simplified VAT-OSS procedure for suppliers who sell goods across the EU without having a registered office in the country of destination which will enable them to settle intra-Community distance sales via a single declaration,
the end of existing national tax rate thresholds for distance sales which, if exceeded, oblige the tax payer to register VAT in the country of destination. These thresholds will be replaced by a single, unified distance sale threshold of EUR 10.000 (PLN 42.000) which includes intra-Community distance sales in the EU, and, if exceeded, oblige the tax payer to register for VAT-OSS.
Changes introduced via the e-commerce package are to facilitate the procedures for entrepreneurs in Poland who sell goods to Germany and other EU countries. This, in turn, will allow them to settle VAT via a single declaration and help them save money.