EU VAT MOSS registrations hit 12,000

The latest published statistics for the number of 2015 EU VAT B2C electronic services providers registered VAT under the new MOSS rules have continued to disappoint.

The total figure across the EU is approximately 12,000. This compares to the hoped-for target of close to 1 million. The UK’s Treasury had estimated 200,000 businesses would have to be register; so far the UK figure is a mere 2,400 - or less than 3% than expected.  The UK still represents over 20% of all EU businesses registered on all MOSS portals.

From the 1 January 2015, the rules governing which VAT rate to use on cross-border sales of digital services to consumers changed for EU-based providers. Instead of the provider using their own country’s VAT rate, they must now charge the VAT rate of the country where their consumer consumes the service. The new rules for determining the residency and consumption are complex, and are still being determined in many countries. To simplify the reporting, each EU member state launched a local reporting portal, Mini One-Stop-Shop (‘MOSS’), where local providers could register and report VAT in other member states.

One of the biggest challenges has been the number of micro-business providers under national VAT registration thresholds who are now being forced to VAT register to report their foreign sales through MOSS for the first time. This problem is particularly acute in the UK which has the highest EU VAT registration threshold at £82,000.