Understanding EU VAT Obligations: Why Online Marketplaces Aren’t a Complete Exemption for Merchants

• Since July 2021, EU e-commerce VAT rules designate online marketplaces as the deemed supplier for certain B2C sales, making them responsible for VAT obligations.
• Merchants may still need to register and file VAT in the EU despite these rules.
• The deemed supplier provision is governed by the EU VAT Directive and applies to taxable persons facilitating B2C supplies via electronic interfaces.
• For VAT purposes, a single B2C supply is split into two deemed supplies: from the underlying supplier to the marketplace and from the marketplace to the final customer.
• The marketplace becomes the deemed supplier for distance sales of low-value goods imported into the EU and certain B2C sales within the EU.
• The original supplier must still handle VAT responsibilities like invoicing and reporting due to the deemed B2B sale with the marketplace.
• VAT registration is required for non-EU suppliers when goods are fulfilled from EU stock and delivered within the EU, as the deemed B2B supply is subject to VAT in the EU country where the goods are located.

Source: essentiaglobalservices.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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