What Are The Advantages of The IOSS System?

The IOSS system is a framework-based solution designed to simplify many processes and provide VAT solutions, offering remedies to potential issues that may arise for businesses and customers. In this respect, the IOSS system provides various advantages to both businesses and customers.

Advantages of IOSS for Sellers

As of July 1, 2021, sellers who do not have an IOSS number cannot be included in the centralized customs clearance system and do not have the opportunity to clear customs from a single point. Accordingly, the seller must organize direct delivery to the country where the sale is made and apply the VAT rates of that specific country.

The IOSS system, developed to facilitate a smooth delivery and sales process, reduces the number of required procedures. Through the IOSS portal, processes such as VAT declaration, payment, and collection can be carried out easily. Businesses registered as IOSS sellers in a European Union member state can conduct commercial activities across all EU countries without issues. In addition, VAT refunds and payments can be handled in the country of registration.

Another advantage IOSS offers to sellers is that customs procedures are completed much faster. When sellers registered as “IOSS sellers” export products to EU countries, customs clearance is carried out quickly by simply checking the IOSS number. For unregistered goods, meaning shipments without IOSS registration, customs approval is granted only after VAT collection has been completed.

Advantages of IOSS for Customers

One of the most important advantages IOSS offers to customers is the absence of customs duties and additional taxes at delivery. Customs charges and extra taxes imposed without prior notice are often not welcomed by customers. In this sense, selling products with VAT included at the time of purchase provides a safer shopping experience for customers, and unexpected additional payments are eliminated thanks to the system. In addition, it is recommended to offer prices calculated based on the tax rates of the EU country for products sold via global online marketplaces. If pricing is not done this way, when the goods arrive at customs, the buyer may need to be contacted for approval of VAT and customs charges, or these taxes may be requested at the time of delivery. Since such surprises can be perceived negatively by customers, they may refuse to accept the delivery.

IOSS-registered sales are very smooth for customers. When a product sold to an EU country reaches customs, since the sale is IOSS-registered, there is no need to enter any system or platform for the payment of VAT or customs-related charges.

Because sellers registered with IOSS can complete customs procedures very quickly, delivery is also carried out much faster. Products that are not covered by IOSS are subject to standard customs procedures, which may cause delays and result in longer delivery times or delivery issues.

Contact us to get detailed information about the advantages of the IOSS system.