One-Stop Shop (OSS) is an EU-wide VAT scheme. It allows entrepreneurs who sell to private customers in other EU countries to report and pay VAT centrally via a single portal in Germany, instead of registering for VAT separately in each country.<\/p>\n
This guide explains what OSS is, which business models and transactions it applies to, and what freelancers, traders, small business owners, and VAT-exempt entrepreneurs need to consider. We also clarify whether a recapitulative statement (ZM)<\/a> is still required when using OSS.<\/p>\n OSS (One-Stop Shop) is a simplified VAT procedure within the EU. It applies to entrepreneurs (in this case based in Germany) who sell goods or services cross-border to end consumers (private individuals) in other EU member states. \ud83c\uddea\ud83c\uddfa<\/p>\n \n Once registered for OSS, you must submit a separate quarterly VAT return via the German Federal Central Tax Office (BZSt) portal<\/a>, which consolidates all relevant EU foreign sales. The VAT due abroad is reported and paid collectively in Germany and then distributed to the respective countries.<\/p>\n \n Without OSS, businesses would need to register for VAT in each EU country where they sell and submit separate VAT returns there. With OSS, one registration in Germany and one centralized quarterly declaration is sufficient. This significantly reduces administrative effort.<\/p>\n Important: Participation in OSS is voluntary (optional). Businesses can choose to use it but are not required to do so. However, if OSS is not used and certain thresholds are exceeded, traditional VAT registration in each EU country becomes mandatory.<\/p>\n OSS can be used whenever sales to private customers in other EU countries are subject to VAT in the customer\u2019s country.<\/p>\n Typical OSS-relevant transactions include:<\/p>\n \n \ud83d\udce6 Intra-Community Distance Sales of Goods: <\/b>This refers to goods sold by a German business to private consumers in other EU countries and shipped from Germany. Example: A German online shop delivers directly to private customers in France or Italy.<\/p>\n \n \ud83d\udcbb Electronically Supplied Services (Digital Products):<\/b> Such as software downloads, e-books, music, videos, online platforms, apps, or cloud-based services sold to EU consumers. These are taxed under the destination principle, meaning VAT is due in the customer\u2019s country of residence.<\/p>\n \n \ud83d\udce1 Telecommunications, Broadcasting, and Electronic Services:<\/b> For example, paid phone services, internet services, streaming subscriptions, pay-TV, etc.<\/p>\n \n \ud83c\udf9f Other Services to EU Consumers Taxable at Destination:<\/b> In some cases, other services to private individuals are taxable where consumed (e.g., event admission, cultural or educational services provided abroad). These may also be reported via OSS.<\/p>\n \n Note: Many traditional freelance services (e.g., consulting, coaching, creative work) provided to private customers are generally taxable at the supplier\u2019s place of business and therefore do not fall under OSS\u2014unless they are digital services or special cases.<\/p>\n \n \ud83d\uded2 Electronic Marketplaces:<\/b> Operators of online platforms facilitating sales to EU consumers may be treated as the deemed supplier in certain cases. They may use OSS to centrally report VAT.<\/p>\n B2B transactions (business-to-business)<\/p>\n<\/li>\n Intra-community supplies to VAT-registered businesses<\/p>\n<\/li>\n Reverse-charge services<\/p>\n<\/li>\n Margin scheme transactions (e.g., used goods)<\/p>\n<\/li>\n Excise goods (e.g., alcohol, tobacco)<\/p>\n<\/li>\n<\/ul>\n Since July 1, 2021, a uniform EU-wide threshold of \u20ac10,000 (net per calendar year) applies.<\/p>\n Cross-border B2C sales may still be taxed in Germany. The destination principle applies. VAT must be charged at the rate of the customer\u2019s country. \n \u26a0\ufe0f Important: Once registered for OSS, it applies to all relevant EU countries. Quarterly declarations are mandatory\u2014even if there were no sales (zero return).<\/p>\n As long as the \u20ac10,000 threshold is not exceeded, OSS is generally not relevant for small business owners.<\/p>\n If the threshold is exceeded, foreign VAT must be charged\u2014even though domestic sales remain VAT-exempt.<\/p>\n Options:<\/p>\n Register for OSS voluntarily<\/p>\n<\/li>\n Register separately in each affected EU country (administratively burdensome)<\/p>\n<\/li>\n<\/ol>\n Important: Waiving the small business exemption binds you for five years.<\/p>\n VAT-exempt services under \u00a74 German VAT Act (e.g., medical, educational, insurance services) are not reported via OSS.<\/p>\n If you provide both taxable and exempt services, only the taxable portion must be considered for OSS.<\/p>\n If you determine that the OSS procedure is relevant for your business and you would like to make use of it, you must officially register before you begin using it:<\/p>\n \n Registration with the BZSt:<\/b> Registration is carried out electronically via the BZSt Online Portal (BOP)<\/a>. You will need a valid VAT identification number (VAT ID). If you do not yet have one (for example, if you are a small business owner who has not needed one before), you must apply for it in advance through the BZSt. <\/a>Make sure to allow sufficient time, as activation of the portal and delivery of access credentials by post may take several days.<\/p>\n \n \u26a0\ufe0f Timing of Registration: <\/b>An OSS registration always becomes effective at the beginning of a calendar quarter. For example, if you want to apply the OSS scheme starting July 1, you must register no later than June 30. After successful registration, you will receive confirmation. From that point on, you are required to submit quarterly reports until you deregister (deregistration is only possible after a minimum participation period or effective at the end of a quarter).<\/p>\n \n \ud83d\udcc6 Submission of the OSS VAT Return: <\/b>The OSS VAT return must be submitted electronically via the BZSt portal on a quarterly basis, no later than the end of the month following the end of the quarter. The specific deadlines are:<\/p>\n April 30 (for Q1)<\/p>\n<\/li>\n July 31 (for Q2)<\/p>\n<\/li>\n October 31 (for Q3)<\/p>\n<\/li>\n January 31 of the following year (for Q4)<\/p>\n<\/li>\n<\/ul>\n These deadlines are fixed and independent of the deadlines for your regular domestic VAT advance returns.<\/p>\n \n Content of the Return: <\/b>In the OSS return, you must list all B2C sales that fall under the OSS scheme for the respective quarter, broken down by destination country and VAT rate. For example:<\/p>\n \u20ac5,000 net sales to France (with 20% French VAT)<\/p>\n<\/li>\n \u20ac3,000 to Italy (22%)<\/p>\n<\/li>\n \u20ac8,000 to Spain (21%)<\/p>\n<\/li>\n<\/ul>\n The portal calculates the VAT payable per country based on this information. All amounts must be reported in euros. If you made sales in foreign currencies, you must convert them using the European Central Bank exchange rate applicable on the last day of the quarter.<\/p>\n \n \ud83d\udcb3 Payment: <\/b>The total OSS VAT amount for all countries combined must be transferred in a single payment to the German Federal Treasury (Bundeskasse) in Trier. From there, the amounts are distributed to the respective countries.<\/p>\n Important: Payment must be made on time. Otherwise, you may still receive payment reminders from foreign tax authorities, as they automatically check whether funds have been received. Make sure to pay promptly to avoid such reminders.<\/p>\n \n Zero Returns: <\/b>If you had no OSS-relevant sales during a quarter, you must still submit a zero return. This means filing an empty VAT return showing \u20ac0. Failure to do so constitutes a breach of your filing obligation, even if no tax is due.<\/p>\n \n Separate Domestic VAT Reporting: <\/b>Please note that OSS only covers foreign VAT amounts. Your domestic sales (to German customers) must still be reported in your regular VAT advance returns and annual VAT return and submitted to your local tax office. OSS does not replace the regular VAT return for domestic transactions. In practice, this means maintaining separate reporting: domestic VAT separately, EU cross-border VAT via OSS.<\/p>\n \n Input VAT on Foreign Expenses: <\/b>One potential disadvantage of the OSS procedure is that it does not provide a direct way to reclaim input VAT paid in other EU countries. Example: If you purchase something for your business in France and pay French VAT (TVA), you cannot reclaim this foreign input VAT via the OSS return. Instead, you must either apply for a refund separately through the EU VAT refund procedure via the BZSt<\/a>, or\u2014if you are already VAT-registered in that country\u2014claim it in the local VAT return there. Ideally, the reverse-charge mechanism applies, in which case no VAT is charged in the first place. For many sole proprietors, reclaiming foreign input VAT plays only a minor role, as most business expenses are incurred domestically. Nevertheless, it is an aspect worth keeping in mind.<\/p>\n No, for OSS transactions, a ZM is not required, as long as there are only such transactions in other EU countries. Normally, an entrepreneur in the EU must submit a Recapitulative Statement (ZM)<\/b> for certain VAT-exempt intra-EU transactions with other businesses \u2013 for example, for intra-community supplies of goods to customers with a VAT ID, or for cross-border B2B services taxed under the reverse-charge mechanism. The ZM allows the tax authorities to reconcile these B2B transactions.<\/p>\n \n Sales to private consumers (B2C)<\/b> that are reported via OSS do not go into the ZM<\/b>. They are fully recorded in the OSS system. So if you use OSS, you report your foreign B2C sales through the quarterly OSS return and do not have to list them additionally in a ZM \u2013 after all, no VAT exemptions under \u00a74b UStG were applied, but VAT was charged (albeit via OSS).<\/p>\n \n \u26a0\ufe0f Note:<\/b> If your company also has B2B sales in the EU (e.g., you supply both private and business customers), both obligations apply: you must still submit a ZM for the B2B transactions and<\/b> use OSS for B2C transactions. The obligations coexist. OSS only replaces the reporting of taxed sales to private consumers, not<\/b> the reporting of VAT-exempt intra-community supplies or other B2B transactions.<\/p>\n The Non-Union OSS<\/b> (often also called \u201cEU-OSS\u201d) is aimed at companies without an EU establishment that provide services to private consumers in the EU. A typical example would be consulting or software services sold by a non-EU company to EU consumers. Such companies can choose any EU member state as their member state of identification<\/b>. They register electronically for the Non-Union OSS in that state. The tax authority of that state issues a special VAT identification number<\/b> in the format \u201cEUxxxyyyyyz\u201d (starting with \u201cEU\u201d), which applies only to the OSS scheme. Using this EU-OSS VAT ID, all relevant B2C services to EU private customers are reported centrally, and VAT is paid there.<\/p>\n \n The right to use the EU-OSS requires that the company has no fixed establishment in the EU<\/b> and provides services exclusively to EU consumers<\/b>. The OSS procedure significantly simplifies VAT compliance for German sole proprietors selling to EU consumers.<\/p>\n It reduces administrative burden but comes with strict reporting obligations.<\/p>\n Small businesses should carefully assess when international sales become relevant and whether switching to regular VAT taxation makes strategic sense. If in doubt, consult a tax advisor. With proper preparation, OSS can be smoothly integrated into your bookkeeping and allows you to focus on your core business while ensuring VAT compliance.<\/p>\n
\nWhat is the OSS scheme?<\/h1>\n
\nWhen does OSS apply?<\/h1>\n
\nTransactions not covered by OSS \u274c<\/h1>\n
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\nThe \u20ac10,000 threshold \ud83d\udcb6<\/h1>\n
Below \u20ac10,000<\/h2>\n
Small business owners (Kleinunternehmer) remain VAT-exempt if below this threshold.<\/p>\nAbove \u20ac10,000<\/h2>\n
Without OSS, separate VAT registrations in each country would be required.
With OSS, VAT is declared centrally in Germany.<\/p>\n
\nOSS for small business owners (Kleinunternehmer)<\/h1>\n
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\nOSS and VAT-exempt activities \ud83c\udfe5\ud83d\udcda<\/h1>\n
\nRegistration and use of the OSS portal<\/h1>\n
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\nIs a recapitulative statement (ZM) required?<\/h1>\n
\nNon-Union OSS (\u201eEU-OSS\u201c)<\/b><\/h1>\n
(Only for services \u2013 for goods sold from a non-EU country, the Import OSS\/IOSS applies.)<\/i><\/p>\n
\nConclusion \ud83e\udde9<\/h1>\n
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