The new rules on e-commerce and VAT declaration in the EU

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Effective from 1st July 2021 new regulatory updates in the VAT law enter into force concerning the following subjects:

  1. First of all – the individual threshold of 35000 EUR up to which the place of supply of TBE services to consumers in another Member State remains in the Member State where the supplier is established is being After 1st July 2021 a threshold of 10 000 EUR per year is being established which is equal for each one of the member states and shall be calculated by taking into account  the  total  value  of cross-border  telecommunications, broadcasting and electronic (TBE) services  and  intra-Community  distance  sales  of  goods to non-taxable recipients and  applies  both  to suppliers and to deemed suppliers.  Until reaching the threshold the TBE services and intra-Community distance sales of goods remain subject to VAT in the Member State where the taxable person supplying those TBE services is established or where those goods are located at the time when their dispatch or transport begins.


  1. The Mini Onestop shop is expanding the system will be extended to other “business to client”(B2C) services, to intra-Community distance sales of goods as well as to certain domestic supplies of goods, thus resulting in a bigger One Stop Shop (OSS). Each taxable person has right and is not obliged to register for OSS. If the right remains unexercised, the taxable person is obliged to register in each one of the member states in which the goods are being sent. The taxable person may register for OSS with submitting application to the competent regional branch of the National Revenue Agency (NRA). After registering for OSS a Bulgarian supplier company is obliged to submit a special VAT return declaration after each quarter. The declaration is being submitted by the end of the month following the quarter and contains data on the distance sales of goods/services to non-taxable recipients.


The Union scheme is being broadened. It will now include service provision with place of supply EU’s territory and whose recipient is non-taxable persons established in the EU and the supplier is taxable person established in the EU. With expansion of the regime the companies may declare and pay their taxes in only one member state – the one of their registration – without considering the country where the VAT is due.


The non-Union scheme is being broadened, too. Now, it will include all kinds of supply of services including TBE services by supplier established in the EU to non-taxable recipient established in the EU, with place of supply EU’s territory.


The persons and entities which are already registered for Union scheme and non-Union scheme may extend their registration from 01.04.2021 to 30.06.2021 by submitting an electronic application to the NRA in order to update the previously submitted data.


  • The VAT exemptions of small consignments with a value up to 30 leva is being revoked and new special scheme is being provided for distance sales of goods imported from third territories or third countries of an intrinsic value not exceeding EUR 150. The new scheme is called – Import one-stop shop (IOSS).


After registering for IOSS the VAT will not be paid when crossing the border at the Customs office (art. 58, par. 1, item 19 of VAT Law). By the power of the VAT Law these supplies are considered tax-exempt when crossing the border but the IOSS number must be announced at the Customs office by the time of the submission of the customs declaration at latest. The VAT will be declared and paid on monthly basis with the submission of special declaration by the supplier. The supplier or his representative may register for the Import Scheme in the member state of identification – in this member state of registration he is obliged also to pay the VAT.  The values of the import supplies must be declared and paid in euro.


When buying goods and services from persons registered at IOSS in another member state the companies may claim VAT refund by the rules and conditions for VAT refund in the different member states.


  1. By the power of a special provision business facilitating supplies through the use of an online electronic interface is deemed for VAT purposes to have received and supplied the goods themselves – the figure of the “deemed supplier” is being introduced. The deemed supplier is taxable person for the supply of the following goods through the use of an online electronic interface:
    1. distance sales of goods imported from third territories or third countries in consignments of an intrinsic value not exceeding EUR 150 and delivered to persons established in the EU regardless the place of establishment of the underlying supplier, or
    2. goods which were already released into free circulation in the EU and goods which are located in the EU and these goods are supplied to recipients in the EU, irrespective of their value, when the underlying supplier/seller is not established in the EU.

In result, the taxable deemed supplier who supply goods through the use of an online electronic interface is treated, for VAT purposes, as the true supplier of the goods – the supply between the underlying supplier and the deemed supplier is zero-rate taxable. For VAT purposes it is considered that the deemed supplier bought the goods from the underlying supplier and then sold them to the client.

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