VAT – Mini One Stop Shop
From 1 January 2015 changes will be made to the place of taxation of consumer supplies of telecommunications, broadcasting and e-services. Currently these supplies are taxed in the Member State in which the business is established. However, from 1 January 2015, the place of supply will be determined by the location of the customer who receives the service. This change will mean that businesses who supply these services will not have to register for VAT in every EU Member State where they have customers.
To avoid the need for businesses affected by these changes to register for VAT in other Member States, a Mini One Stop Shop (MOSS) will also be introduced from 1 January 2015. The MOSS scheme will allow businesses affected by the changes to avoid registering for VAT in every EU Member State where they make supplies.
The MOSS will be an electronic system that allows businesses the option of registering in one EU jurisdiction and accounting for VAT due in other Member States using a single return. The transactional details along with VAT payments to the relevant countries will be transferred electronically using the MOSS system. The use of the MOSS will be optional.
There will be two schemes, one for businesses established within the EU and one for businesses that are not established in the EU. For EU businesses the submission of an MOSS return would be an additional responsibility on top of their regular domestic VAT return. The current VAT on e-Services (VoES) scheme for non-EU businesses will be replaced by the MOSS and existing VoES users may transfer to the new scheme. Draft legislation has recently been published and is expected to be introduced in Finance Bill 2014.