Following the change of the rules for distance sales of goods imported from outside the EU from July 1, 2021 there will be two mechanisms for the settlement of distance sales of goods imported from outside the EU:
A. through IOSS which is a special import procedure called import One Stop Shop. Each low-value product will be subject to VAT, and in order to declare and pay VAT, the legislator has created IOSS for sellers who make distance sales of imported goods from third countries to the European Union. In the case of IOSS, the supplier / operator of the electronic interface will charge and collect VAT when the goods are sold and declare and pay this tax globally via IOSS in the country of identification. These goods will then be exempt from VAT on import, which will allow them to be quickly released at customs (if IOSS is used, the import of the goods will be VAT exempt as VAT will already be paid at the time of sale).
b. if IOSS is not applied, import VAT will be collected from the person for whom the goods are intended (the final consumer) by the person making the customs declaration (e.g. postal operator, shipping company), who will pay the VAT collected from the recipient to the customs authorities by making a monthly payment .
Establishing an intermediary
The import is based on settling the VAT due on distance sales of goods imported from third countries. The VAT is paid to the Member State of completion of shipment to the consumer via the country of identification. Only this taxpayer making a distance sale of imported goods may use the import procedure who:
A. is established or has a permanent place of business in the territory of the European Union;
B. is not established or does not have a permanent place of business in the territory of the European Union but is represented by an intermediary.
Therefore, a non-EU taxpayer will have to appoint an intermediary.
Conditions of being an intermediary
The law indicates a closed catalog of entities that will be able to become such an intermediary. It will not be a random person, but an entity that meets specific requirements.
Only a natural person, legal person or an organizational unit without personality will be able to become an intermediary if it meets the following conditions:
A. is an active VAT payer
B. has its registered office or a permanent place of business in the territory of the country, which it chooses to submit a declaration informing about the intention to use the special import procedure
C. does not have any arrears with the payments of individual taxes for the last 24 months
D. has not been legally convicted under the Act of 10 September 1999 – Fiscal Penal Code for committing a fiscal offense
E. is entitled to provide professional tax consultancy in accordance with the provisions on tax advisory or to provide bookkeeping services in accordance with the provisions on accounting.
Duties of an intermediary
The intermediary will perform, on behalf of and for the taxpayer for whom it has been established, the obligations of that taxpayer in the field of VAT settlement in the import procedure, including the obligation to prepare VAT return and to pay VAT. It will also be responsible for keeping and storing documentation and making it available when requested. It is also the intermediary who will be responsible for reporting the intention to use the import procedure by this taxpayer. He will be jointly and severally liable with the taxpayer for the tax liability that he settles for and on behalf of that taxpayer. The taxpayer identified for the purposes of the import procedure or the intermediary acting for the taxpayer are required to submit electronic VAT returns to the competent tax office. Such an obligation arises even if the distance sale of imported goods under the import procedure has not taken place. The deadline for submitting monthly VAT reports will expire at the end of the month following each subsequent month.
Read more about our VAT Consulting Services https://polishtax.com/services/tax-and-accounting/vat-consulting-poland/