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Webinar ‘Servicing your European Customers in the Age of E-commerce’

Best practices in distribution, logistics and tax

  • date 16.02.2021
  • time 16:00
  • location Online

E-commerce is booming in Europe. The pandemic has fast forwarded the adoption of online purchasing by consumers and business. How can you, as a North American company, grasp the opportunities of e-commerce while at the same time avoid the common pitfalls? It is crucial to get the logistics and VAT right! The webinar ‘Servicing your European Customers in the Age of E-commerce’ on February 16 provided the participants the latest best practices on how to serve their European customers from a logistics and tax perspective.

Missed it? Please click here to see the webinar.

Presentation Webinar ‘Servicing your European Customers in the Age of E-commerce’

 

Q&A

Q:
Could you please explain how the authorized representative works? Is it a requirement per eu consumer law? Does this also apply for B2B trading?
A:
Depends on the EU directive, please join our next webinar for more info: https://hollandinternationaldistributioncouncil.com/en/events/webinar-european-e-commerce-in-2021-new-vat-and-authorized-representative-rules-as-per-july-this-year/

Q:
When you don’t know where your products are going? Can also be the NL, what to do with the VAT?
A:
When all your products are imported in the Netherlands, you either pay VAT upon import and later reclaim it or you apply for the article 23 license and no import VAT payment is due (it is deferred). After the sale, you can then ship your goods to any country in the EU and apply a 0% VAT rate on your invoice in case of B2B or charge the local VAT rate for a B2C sale.

Q:
When we have the distribution out of the NL to the rest of the EU. What language on label?
A:
You should label the product In the language of the country of sale. You can label in multiple languages or have your fulfilment provider re-label based on order.

Q:
After July1, will it also be possible to have VAT borne by end-consumer?
A:
VAT is always borne by the end-consumer, this will not change. After July 1, the method of reporting and paying the collected VAT to the local tax offices will change, as this will be done via the tax office of one country rather then for each country separately. However, your billing to the consumers will not change.

Q:
B2B in the NL the business client in the NL pays the VAT?
A:
In case your company does not have a presence in the Netherlands (e.g. only a VAT registration of Fiscal Representation), domestic VAT in a B2B transaction is “reverse charged” to the customer, meaning you will not charge VAT and the client reports this in their VAT return, both as payable and refundable VAT. When you are established in the Netherlands, i.e. via a “BV”, you will charge VAT on the sale and your client will normally be able to get this VAT refunded.

Q:
After July1, if you are an Amazon FBA only seller, will you still need to register for VAT in a EU country even if Amazon will be taking care of VAT collection and remittance
A:
Where as before the 1st of July FBA sale is regarded as one single sale from the seller to the customer, after the 1st of July 2021 these sales will be split up in two parts. One transaction is that between the seller and Amazon (B2B) and one transaction is between Amazon and the customer (where VAT is collected and remitted). So whether or not a seller would be required to register in a EU Member State yes or no, would depend on whether or not their B2B-transactions to Amazon trigger any reportable transactions from a VAT-perspective. So for instance: if goods are purchased in the Netherlands by the seller and sold and shipped from the Netherlands to Amazon Germany, this would trigger a requirement for the seller to register for VAT-purposes in the Netherlands to report the Intracommunity Supply of Goods.

Q:
Would we need to engage various tax advisors to do the filings? Or can my accountant file from NL? Referring to the one stop shop system
A:
When you have a VAT registration in the Netherlands, as of July 1 your VAT filings can be done out of the Netherlands under the one-stop-shop system. As such, you will not need to engage a local tax advisor or accountant in each country to arrange for the filing. Please do note that you will still have to charge the local VAT rates and separate out your sales and VAT per country in the filing.

Q:
Can an importer be a fisical rep?
A:
The importer will generally not be the Fiscal Representative themselves. The US or Canadian entity can act as the importer of record, but will be required to have a VAT registration in order to do so. In order to also qualify for the “article 23” license so you can defer the import VAT, you will need to appoint a Fiscal Representative. As such, the Fiscal Representative will not be the importer of record themselves.

Q:
In the case of having Fiscal rep with Article 23, if you have unsold inventory, you will still have a payment due on those items each quarer, correct?
A:
No, VAT will only be applicable on the individual transactions. With the Article 23, you will not have to pay the import VAT as this is only reported on your next VAT return. The sale of the goods generally require you to charge and collect VAT, although this will be dependent on the type of transaction (B2B, B2C) and where your customer is located.  In case the unsold inventory is remains in inventory, it will not need to be reported. Do note that even when there have not been any transactions in a quarter, you will still have the obligation to file a VAT return as long as the VAT registration is active. This could also be a nil-filing.

Q:
I understand that HIDC provides general information on the specific supply chain structure and best construction, so that  Briddge may then be contracted to register the legal structure and contract formally.
A:
That is correct. We can assist with the logstics structure and find 3PL partners, Briddge can assist with VAT and/or corporate set-up, We have other specialists in our council as well

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Jelle de Rooij, senior supply chain manager

Jelle de Rooij

Senior Manager Supply Chain Solutions

Contact me and let me guide you to The Netherlands for a smooth entry into the European market.

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