OSS declaration also possible for B2C services in other country

You thereby avoid foreign VAT registration and declaration obligations. Nevertheless, the hoped-for simplification does not always come about. So please carefully consider whether an OSS declaration is the best option for you.

As of 1 July 2021, you can also report services to non-taxpayers (so-called B2C services) that take place in other Member States via a OSS (One Stop Shop) declaration).

What about B2C services in another Member State?

For most B2C services, the VAT is due in the country where the supplier is established.

Different rules apply for some B2C services. This is the case for the following services, among others.

• Services relating to immovable property in another Member State. For example, window cleaners and gardeners who maintain a house and garden for private individuals just across the border;
• Transport of passengers by private individuals in another Member State, such as taxi services;
• Access to events in other Member States, such as tickets for a running event or a concert in the Netherlands;
• Restaurant and catering services in other Member States, such as food trucks selling their wares at an event taking place in another Member State;
• Telecom, broadcasting and electronic services (TBE services), such as apps, electronic publications, software etc., that are downloaded by individuals based in other Member States.

Rules for B2C services up to 30 June 2021

Up to 30 June 2021, a distinction is made between electronically provided TBE services and other B2C services.

TBE services

For TBE services provided to individuals established in other Member States, you already have the option of filing a MOSS (Mini-One-Stop-Shop) return. The foreign VAT is reported and paid in Belgium. The Belgian VAT administration then passes on this VAT to the correct countries. Please note that Belgian VAT is charged as long as your turnover for this activity does not reach the threshold of EUR 10,000, excluding VAT.

Other B2C services

If you perform other B2C services for which foreign VAT is due, you must register abroad for VAT purposes from the first transaction. You must submit periodic VAT declarations there in order to pay the VAT.

Rules for B2C services as of 1 July 2021

As of July 1, 2021, this distinctionbetween TBE services and other B2C services will disappear. You can declare the foreign VAT for both via an OSS declaration. You therefore no longer need to apply for a VAT number in another Member State or to submit regular VAT returns.

Once you opt for an OSS declaration, this choice applies to all B2C services on which foreign VAT is due. And also for intra-community remote sales.

The OSS scheme is applicable to all B2C services. The condition is that the supplier is not established in the Member State where the VAT is due. The fact that the customer is established in the same Member State as the supplier does not prevent the application of the OSS rule. For example, a Belgian organiser could apply the OSS scheme to the sale of tickets for a concert in the Netherlands to Belgian private individuals.

For TBE services provided to individuals who are established in other Member States, the rule that Belgian VAT applies as long as the threshold of EUR 10,000, excluding VAT, is not reached will continue to apply after 1 July 2021.

For the purposes of calculating this threshold, account will henceforth not only be taken of the TBE services provided to private individuals who are established in other Member States, but also with the intra-community remote sales of goods.

You can, of course, choose to charge foreign VAT if you have not yet reached that threshold. Please note: If you opt for the OSS scheme, it is no longer possible to charge Belgian VAT on TBE services provided to private individuals in other Member States. This will remain the case, even if you have not reached the EUR 10,000 threshold.

Check whether an OSS declaration is the best choice

The option of submitting an OSS return for B2C services can represent a significant administrative simplification for you, by allowing you to avoid foreign VAT registrations and VAT reporting obligations. Opting for the OSS returns will not bring the hoped-for simplification in all cases, however. It is therefore best to check in advance what the best option is in your case.

1. You already have a VAT registration in another Member State for the B2C services you provide there. You have no future plans to offer these services to private individuals in other Member States.

   In that case, you can keep your foreign VAT number and continue to submit foreign returns. If you opt for an OSS declaration, you must discontinue your foreign VAT number. But you will still need to file a separate OSS return after that. Moreover, you cannot deduct VAT in an OSS declaration, as you can in a normal VAT declaration. If you prefer an OSS declaration, you may have to submit an additional VAT refund application.
    

2. In addition to B2C services in a specific Member State, you also provide services to B2B customers. You will thereby need a VAT number in that Member State.

   For example, you may carry out real estate or building work in Luxembourg for individuals or companies. In this case, opting for an OSS declaration would lead to additional administrative burdens. In that case, you must submit both a Belgian VAT return and a Luxembourg VAT return (for work done for B2B customers in Luxembourg) and an OSS return (for work done for B2C customers in Luxembourg!

Would you like the VAT team to work together with you to determine which solution best suits your scenario? Be sure to get in touch.