Warehousing abroad in the context of VAT registration – what should you know?
Today’s e-commerce trends are increasingly forcing businesses to look for alternative logistics solutions, such as warehousing abroad. The decision to relocate part or all of your warehousing operations to another country can bring many benefits, but at the same time raises certain tax obligations, especially in the context of registering for VAT. In this article, we will outline the important issues that businesses should be aware of when storing abroad and registering for VAT.
Necessity to register for VAT in the country where goods are stored
Moving a warehouse abroad means that a business must register for VAT in the country concerned. Therefore, it is important to be thoroughly familiar with the local tax regulations and registration requirements in order to comply with the applicable legislation.
One Stop Shop (OSS)
In order to facilitate tax settlements, the European Union has introduced the One Stop Shop (OSS) procedure, which aims to simplify the VAT settlement process for transactions between member states. So how does storing abroad affect the use of the OSS?
The One Stop Shop (OSS) procedure allows businesses to make a single declaration and payment of VAT for e-commerce transactions within the EU. This avoids the need to register for VAT in each individual country where sales are made. With the OSS, traders can settle VAT in their own country, instead of registering in each country where they have customers.
In the context of warehousing abroad, OSS can apply to sales of goods stored in warehouses in different member states. When a trader has a warehouse in one country but sells goods to customers in other countries, they can use the OSS to report and account for the VAT associated with these transactions. A company can choose OSS as a VAT settlement method even if it is registered for VAT in the country where the warehouse is located. Then cross-border B2C sales are shown on OSS returns, while country-specific VAT returns show local sales, B2B sales and inter-warehouse transfers.
Local VAT rates and regulatory issues for e-commerce sellers
Warehousing abroad may involve compliance with local VAT rates and documentation and reporting regulations. Businesses should know exactly what the VAT rates are in a particular country and the requirements for invoicing, sales record keeping and tax returns.
Consultancy services and professional support
VAT registration for warehousing abroad can be complicated and requires in-depth knowledge of tax regulations. It is recommended to use advisory services or professional tax support to ensure that all tax obligations are fulfilled correctly and in accordance with the applicable legislation.
Which foreign storage option will be best for your business?
Storage of goods abroad – “call-off stock” or fulfillment Amazon, eMAG, eBay?
Let’s start with call-off stock warehouse. A call-off stock warehouse is located outside the country of the seller’s headquarters. Businesses use this solution to increase logistical efficiency and improve customer service.
How exactly does a call-off stock warehouse work and why is it needed?
A call-off stock warehouse allows suppliers to store their goods near their end customers. In this situation, the business moves its own goods to a warehouse in the country, but formally they remain the property of the supplier. By locating the warehouse close to the customer, the delivery of goods becomes faster and more efficient. Recipients can use the range of available products without having to wait for shipment from a distant country. What’s more, a call-off stock warehouse helps minimize international shipping costs. Suppliers can benefit from more economical and efficient logistics solutions, resulting in financial savings.
For whom is call-off stock important?
First and foremost, for e-commerce businesses that serve customers in different countries. Such companies often rely on the location of call-off stock warehouses in strategic locations to reduce delivery times and optimise logistics processes. It is worth noting that a call-off stock warehouse also has certain tax implications, such as the obligation to register for VAT in the country in which it is located.
Therefore, businesses should consult a tax advisor to make sure that they comply with all tax requirements and laws of the country.
Fulfillment – Amazon (FBA), eMAG, eBay
If you want to expand your online presence and reach more international customers – selling through e-commerce platforms such as Amazon or eBay can be a good option. These platforms offer a wide reach and logistics infrastructure, which can make it easier to sell and deliver goods in different countries.
The Fulfillment service allows sellers from all over the world to take advantage of the logistical support offered by marketplaces when selling their products.
The sales platform takes care of packaging, shipping and handling shipments and returns. The main advantage of this solution is the ability to reach global markets, which contributes to increased sales and export growth. Sellers do not have to worry about having their own warehouses or the timeliness of deliveries. An important benefit is the transfer of responsibility for shipping and product preparation from the seller to the marketplace.
Choosing the right storage model depends on individual factors and the needs of your business. It is important to carry out an analysis, compare different options and match them to your business strategy and goals.
Don’t leave your business to chance.
Take advantage of our knowledge and experience to ensure correct tax settlements, avoid the risk of non-compliance and maximise the potential of international e-commerce.
Contact us and be sure that your warehousing abroad will comply with tax requirements.
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