Brexit Phase II - IOSS

[Mantra]

Hi Martin,

We update the following page with general information, including options - https://www.sellerdeck.co.uk/practic...-preparations/

Currently a Taxamo integration isn't on our development roadmap, although we are always considering options.

Looking at your site, I'm assuming you aren't accepting orders from EU (maybe I picked a unique product). And for any orders outside of UK you manage as duty unpaid?

Thanks,
Josh

Hi Josh

We suspended accepting orders from the EU in January 2021 pending implementation of the actions listed on the Sellerdeck practical advice which were completed shortly thereafter.

However, it soon became apparent that we would not be in a position to resume accepting orders from the EU due to the implementation of the IOSS regulations in July 2021 and we have been searching for a viable delivery method that takes account of IOSS without having to register for IOSS and engage an intermediary.

All the packages we send are small mostly mailbox size jiffy packets and Royal Mail is the best solution for delivery at the moment.

The Taxamo method suggested by Royal Mail appears to offer a solution and I am a little surprised that this has not been considered by Sellerdeck and the practical advice last updated on 4 February 2021 has not been further updated to account for the introduction of IOSS.

Martin
Mantra Audio

[Josh Barling]

Hi Josh

What is the latest position?

Have Royal Mail PDDP and Taxamo Assure API integrations been considered?

There is not much information concerning API integration on the Taxamo website!

Martin
Mantra Audio

Hi Martin,

We update the following page with general information, including options - https://www.sellerdeck.co.uk/practic...-preparations/

Currently a Taxamo integration isn't on our development roadmap, although we are always considering options.

Looking at your site, I'm assuming you aren't accepting orders from EU (maybe I picked a unique product). And for any orders outside of UK you manage as duty unpaid?

Thanks,
Josh

[Mantra]

We are close to releasing detailed information and instructions on the current options, as well as investigating future options.

Thanks, Josh

Hi Josh

What is the latest position?

Have Royal Mail PDDP and Taxamo Assure API integrations been considered?

There is not much information concerning API integration on the Taxamo website!

Martin
Mantra Audio

[Mantra]

I noticed that Royal Mail DDP service has moved on a bit but still has limitations and complications for low value consignments <150 EUROS.

I got an update from Royal Mail today and they confirmed that IOSS is not provided by RM (Royal Mail) and pointed me to the Taxamo link below as being a solution that may be suitable:
Taxamo Assure for VAT/IOSS Management | Vertex, Inc. (vertexinc.com)

"Taxamo Assure is a ‘pay as you go’ solution ideal for smaller customers who want a hassle-free way to continue to send goods to EU consumers without having to invest lots of time and resource in meeting the new requirements. They don’t need to register with IOSS, worry about calculating VAT or file tax returns as Taxamo do all that for them. Taxamo simply plug-in’ to the customer’s online checkout and the customer uses Taxamo’s IOSS number to send their items via RM. Taxamo calculate and pay any tax owed as well as file the tax returns. Customers pay no fees but £2 per item so this makes sense for customers sending under 3000 items to the EU a year."

This relies on an integration on the order checkout process and it would be helpful if Sellerdeck could advise if there are any plans to make provision for this?

Has anyone experience using the Taxamo Assure solution that can be shared?

[Mariner]

Question is have Royal Mail signed up for IOSS and applied this in their API for the PDDP service?

Ebay seem to have this wrapped up in that the EU customer pays the VAT due on an order direct to ebay and this is confirmed on the postage delivery label on the bottom line beneath the delivery address and on the electronic customs declaration to avoid additional VAT being applied at the border:
VAT Paid : IOSS - IM2760000742

After a hectic/chaotic (delete as applicable) pre-Christmas period, this is the first time I've had the chance to look back at this thread.

My understanding is that PDDP is entirely external to IOSS. They are achieving the same thing (i.e. faster passage through the postal stream without customs clearance charges) but via different routes. PDDP more for larger orders for customers who don't want the expense and inconvenience of signing up to IOSS, the record-keeping, the payments to an EU tax authority etc etc. The Royal Mail arrange the clearance directly, liaising with the postal authority/customs in the destination country. This is why so few destinations are currently covered. In the case we mentioned (the only occasion we've used PDDP, as it turns out), an IT error led to the issue. The Royal Mail refunded our shipping fees, we refunded the customer. Hardly ideal but hopefully something which wouldn't happen if we were to use the service again.

The number of hours I've spent battling to get information about packages sent to the EU over the past six month via the Royal Mail/DPD is just shocking. The IT problems in Italy have caused chaos for packages sent without IOSS (and there have been big delays with ebay orders using IOSS), to the extent that the Royal Mail isn't recommending that packages are sent to Italy since 22nd December. Italian customs reportedly have a massive backlog of packages to clear which will hopefully be sorted out during the next couple of weeks as we're actually holding a couple of packages for customers who ordered during late December! DPD have been utterly hopeless to the extent that we're going to look elsewhere. If our 'account manager' ever answered his phone or responded to e-mails it might be different, but I've literally not been able to contact him for months!

We haven't been able to consider setting up IOSS yet so send packages to the EU on the understanding the customer will have the inconvenience and expense of paying the VAT and clearance charge. We've been informed of the whole gamut of situations. A handful of customers apparently receive their packages without being asked to pay anything (must be a glitch). In many countries, customers are being charged the incorrect rate of VAT (we only sell books which a lower-rated in most countries). This is the difference between 4% and 22% VAT in Italy, for example. 4% and 21% (I think) in Spain. We simply don't know how many customers are being charged the incorrect rate of VAT for their deliveries as we don't have any feedback from most of them. We no longer send packages to Italy via DPD. For some reason, Italian customers were being charged between 25% and 33% of the order value before they could receive their packages from DPD! Something to do with the charge of the agent who ship packages in through Switzerland for DPD, I suspect, although it was impossible to get a clear answer from anyone at DPD.

Customs clearance charges in many countries are low (6 or 7 Euros or thereabouts) but there are outliers. Belgium charges something like 24 Euros per packet (plus the VAT) for customs clearance so we've lost almost all our Belgian business. Denmark charges the equivalent of 20 Euros for customs clearance and their VAT on books is 25%. A handful of Danish orders last year, unsurprisingly. Most concerningly is that we sent a Spanish customer 3 tracked packages towards the end of December and he has been charged over 98 Euros to receive them! He sent us a sample invoice and, though the correct rate of 4% VAT has been charged, there were handling and customs fees totalling 25 Euros for each package! That's the same range as we've seen for countries such as Belgium and Denmark. As I mentioned, there is no way to know what customers in various countries are being charged, but I suspect we won't be seeing a lot of older customers coming back to us this year.

The reason I came back to this forum was to check to see if there was any further mention of IOSS but a quick search would indicate not, which is very disheartening. If the Taxamo Assure API supported by the Royal Mail could be compatible with Sellerdeck, it would make IOSS a possibility for some of our sales, at least. The customers are charged the correct VAT at the point of sale, Taxamo arrange the payments and so forth for the IOSS and then the seller is charged just £2 per package sent. I see there is no mention of this on the whole of this forum which isn't promising.

Does anybody here have any experience of IOSS but for sales on ebay and Amazon marketplace?

[Mantra]

Well, the first consignment we have sent via the Royal Mail's PDDP service hasn't had the most auspicious of starts. The German customer has been contacted by DHL (who apparently deliver Deutsche Post's Tracked packages for them) and asked to pay a clearance charge on each, plus an incorrect higher-level rate of VAT! He should have just had the packages delivered with any fees then invoiced to us. The Royal Mail are investigating.
....
These are all shipments without IOSS, obviously. In the longer term, I expect we'll need to sign up for IOSS one way or another but I can't see how we'll be able to work it as quite a few of our European orders come through the post from older folk without internet access. With varying rates of VAT in pretty much every country (ranging from 0% up to 25% on books), it would be extremely difficult to get them to pay the correct amount. Heck, half of our customers can't add up their order totals correctly in the first place, so trying to get them to calculate an extra 4%, or 7% or 9% would be all but impossible! Especially as VAT is also charged on the postage as well.

Question is have Royal Mail signed up for IOSS and applied this in their API for the PDDP service?

Ebay seem to have this wrapped up in that the EU customer pays the VAT due on an order direct to ebay and this is confirmed on the postage delivery label on the bottom line beneath the delivery address and on the electronic customs declaration to avoid additional VAT being applied at the border:
VAT Paid : IOSS - IM2760000742

[Mariner]

Well, the first consignment we have sent via the Royal Mail's PDDP service hasn't had the most auspicious of starts. The German customer has been contacted by DHL (who apparently deliver Deutsche Post's Tracked packages for them) and asked to pay a clearance charge on each, plus an incorrect higher-level rate of VAT! He should have just had the packages delivered with any fees then invoiced to us. The Royal Mail are investigating...

The fact that these packages contain replacements of an order sent to our German customer because DPD didn't manage to deliver the original parcel (he paid the required duty, but the package is still being returned to us!) is a reflection of the chaos in the postal system throughout Europe at present.

These are all shipments without IOSS, obviously. In the longer term, I expect we'll need to sign up for IOSS one way or another but I can't see how we'll be able to work it as quite a few of our European orders come through the post from older folk without internet access. With varying rates of VAT in pretty much every country (ranging from 0% up to 25% on books), it would be extremely difficult to get them to pay the correct amount. Heck, half of our customers can't add up their order totals correctly in the first place, so trying to get them to calculate an extra 4%, or 7% or 9% would be all but impossible! Especially as VAT is also charged on the postage as well.

[Josh Barling]

Thank you for sharing your research - its very useful.

We are close to releasing detailed information and instructions on the current options, as well as investigating future options.

Thanks, Josh

[sulis]

As Mariner reports, it looks like Royal Mail PDDP is available at the moment for all values of sales into France, Germany, Holland, Cyprus, Malta, with more countries being added.

As a manufacturer, nearly all our products qualify for UK origin status. HMRC confirm that all goods of UK & EU origin trade into the EU free of duty.
For small shipments (under 500 euros) sellers can use a waiver and self declare origin (as long as not a commercial import- I take that to mean wholesaling rather than retailing?)
With no duty to be charged this greatly simplifies the situation as far as Sellerdeck goes.

We are going to give PDDP a go.

[Mariner]

Royal Mail PDDP appears that it may not cater for B2C packages below 150 Euro limit - see link below:

https://www.royalmail.com/business/i...ties-paid-ioss

The Royal Mail PDDP services (only available for limited destinations at present) appear to be OK for B2C either above or below the 150 Euro limit, at least if the information provided to us by our account manager is correct! However, they only 'recommend' use of these services for orders over EUR 150. I suspect the reason for this recommendation is the way in which they arrange to collect the payment. You could end up receiving a lot of small invoices from the Royal Mail, one for each package sent, I think. Excerpt from the message sent from our account manager:

Costs and Billing:

• Service rate card for both Tracked and Untracked options attached – please note: prices include the temporary air carrier supplement; however do not include the 6.5% international surcharge.
• The services are invoiced as normal on your regular Royal Mail invoice.
• Once items have cleared overseas customs, the VAT + duties owed + 50p handling fee (not included in rate card) are charged back to you via a separate summary invoice*.
• VAT is charged at the rate in the destination country e.g. 21% in Belgium. This VAT invoice should match with what you, as the sender, have charged the recipient in the EU, as determined by the landed cost calculator (see below for more info on the landed cost calculator).
• *The invoice will show a summary level view of any charges and line item level detail can be viewed via the e-invoicing portal.

We haven't had the opportunity to consider registering for IOSS yet due to pressures of work so our European customers are having to deal with the DDU services and the hassle involved there at present. Quite a few issues encountered, as you might imagine.

In the longer term, many of our smaller overseas orders come through ebay and will therefore go using ebay's IOSS number so not sure if our own IOSS registration will be feasible. The Deloitte arrangement with the Royal Mail seems exceedingly espensive and the Taxamo link where you pay a flat £2.00 rate for each package also requires API link up with your shopping cart. A lot depends on how much an intermediary would charge to provide their service as to whether or not registering for IOSS ourselves will be feasible.

Ultimately, whatever happens, the IOSS will lead to significant additional costs which we would have to push on to the postage prices for the customer, but it would still be cheaper than the VAT + customs clearance charges they currently pay. Belgium's charge for customs clearance costs well over EUR 20.00 per packet, for example! Most are just a handful of Euros, however.

I'm still waiting for details of the DDP services available from DPD because our account manager is utterly useless, doesn't answer his phone or respond to e-mails. Plus ça change, as they say across the channel.

As we sell books and a handful of DVDs, the majority of our sales are at reduced VAT rates on the continent (no VAT in the UK on books, of course) so there is no duty for most orders. Calculation of the VAT due should be pretty straightforward in our case. However, it would be helpful to discover what Sellerdeck plan to do to assist with IOSS. I would imagine that manually entering the shipment information in Click and Drop should provide all the required customs data for the Royal Mail to calculate the corect fees due via their PDDP system so not sure if Aura integration would be required for us given the moderate volumes of EU business which come from our own customers and not through ebay.

[Mantra]

We are mainly using royal mail and send packages both above and below the 150 euros limit. Royal Mail are suggesting using their PDDP (postal delivery duty paid) service when it is ready. It uses Aura API by Hurricane in the checkout to calculate correct tax and duty (if any). Royal mail would bill us later for the tax and duty along with 50p per package handling. Is this something that can work with Sellerdeck?
Mark Faulkner

Royal Mail PDDP appears that it may not cater for B2C packages below 150 Euro limit - see link below:

https://www.royalmail.com/business/i...ties-paid-ioss

[Mantra]

Will the Aura API be integrated with Royal Mail Click and Drop?

Royal Mail Click and Drop appears to be integrated with many online selling market places but Sellerdeck does not get a mention - so has any development taken place to address this?

I understand Royal Mail Click and Drop can be used to produce CN22 and CN23 custom declaration labels from interfaced data tables as well as postage address labels and Sellerdeck BREXIT patch releases now includes product variables for HR (tariff) codes and country of origin to show on EU Invoices and guidance has recently been given on how to set different VAT rates that apply for various EU member states so it appears that all the data fields likely to be needed to produce name/address labels, EU VAT Invoices, CN22/CN23 customs declarations, EORI numbers etc. are already catered for.

The Aura API development for PDDP by Royal Mail looks promising and I would be interested to know if Sellerdeck or perhaps Codepath are considering developing an 'add on' to interface with Royal Mail Click and Drop/Aura API?

[Mike Hughes]

I'm sure it can work but will probably need some development effort.

The Aura API will need the product details including HR6 code which I don't think is normally available in the checkout, plus you're going to need some way of feeding the resulting charge back into sellerdeck that it's happy with and doesn't try to override.

[sulis]

We are mainly using royal mail and send packages both above and below the 150 euros limit. Royal Mail are suggesting using their PDDP (postal delivery duty paid) service when it is ready. It uses Aura API by Hurricane in the checkout to calculate correct tax and duty (if any). Royal mail would bill us later for the tax and duty along with 50p per package handling. Is this something that can work with Sellerdeck?
Mark Faulkner

[DJO]

After Brexit phase 1, it has taken nearly six months for our EU customers to get used to paying there own governments taxes, so the thought of complicating the matter again with IOSS made me also want to throw in the towel with Europe.

Then I read the DPD issue on the requirements for IOSS. and after the depression of the first 7 pages, page 8 gave me the words I was looking for, " Whilst IOSS is not a mandatory scheme, there are many benefits of registration" .

That statement was music to my ears and will do just nicely. I will just keep doing what we are doing now and forget IOSS.until the next hurdle is erected.

Dave

Here is the document: EU_Vat_Doc.pdf