The EU One Stop Shop (OSS) feature in NetSuite allows businesses to apply the correct tax on B2C sales of physical goods and services based on VAT rate of the customer’s EU member state.
Before January 2015, under EU taxation rules, digital service sales to non-VAT registered EU customers were taxed at the seller’s business VAT rate. Telecommunications, broadcasting, and electronically supplied services are categorized as digital services under the EU VAT rules. Companies selling or handling stock in European Union (EU) countries must maintain VAT registrations and submit VAT returns in accordance with the rules of each country. Under the OSS scheme, VAT-registered businesses selling digital services to non-VAT registered EU customers no longer need to register for VAT in every EU country they conduct business. Businesses can choose between OSS registration and local VAT registrations, whether they are EU-based or non-EU-based.
The OSS scheme includes a non-Union scheme for non-EU based businesses and a Union scheme for EU-based businesses, both of which are optional. Companies that opt into OSS must apply the scheme to all their sales of digital services to EU customers.
The EU introduced the Mini One Stop Shop (MOSS) scheme to reduce the need for digital service suppliers to register for VAT in every EU member state they operate in. With the MOSS scheme, businesses can submit their tax returns to a single tax agency in the country where they are registered for MOSS.
If your company is registered for the EU One Stop Shop (OSS) VAT scheme, do the following:
- Enable the OSS feature in your NetSuite account.
- Identify the service items that are subject to OSS VAT. Goods are automatically subject to OSS VAT in NetSuite. You can update your item records using CSV import or web services.
- Install the International Tax SuiteApp (Bundle ID 43003) if it is not yet in your account. This SuiteApp provides the OSS tax codes and tax types.
- On the Subsidiary page, check the MOSS Applies box.
- Assign an OSS nexus to the subsidiary.
To assign an OSS nexus to a subsidiary:
- Go to Setup > Company > Classifications > Subsidiaries.
- Click the Edit link of the subsidiary.
- Check the MOSS Applies box.
- In the OSS Nexus field, select the country where you are registered for OSS. Only EU nexuses associated with this subsidiary are available in the dropdown list. You can only select one OSS nexus per subsidiary.
- Click Save. Saving the subsidiary record triggers the automatic provisioning of the OSS tax codes, tax control accounts, and tax types by the International Tax Reports SuiteApp if it is installed in your account.
In OneWorld accounts, the OSS tax codes, tax types, and tax control accounts are automatically created when you assign an OSS nexus to a subsidiary. This automatic provisioning requires the International Tax Reports SuiteApp.
For enabling OSS feature in NetSuite:
Navigate to Setup –> Company –> Enable Features –> Tax and check the box for ‘EU ONE STOP SHOP’ then click the save button.