New VAT regulation from 1st of April 2020
Who must register?
From 01 April 2020, the Norwegian Tax Authority will introduce a new VAT scheme – VAT on E-commerce (VOEC). This is a simplified VAT scheme for foreign B2C sellers or marketplaces of low value goods under NOK 3 000 (≈EUR 300). The registration does not require the seller to register a company in Norway as the regular VAT scheme does. The seller is obliged to register for VOEC when the revenue exceeds NOK 50 000 during a 12-month period. The companies that do not reach the NOK 50 000 threshold can also choose to register in this scheme. If the shipment is covered under VOEC scheme, it is subject to simplified customs procedures with no customs declaration. The VOEC scheme is largely similar to the EU MOSS-scheme.
What are the “low value goods”?
The VOEC scheme includes all low value goods except foodstuffs, goods subject to excise duties (tobacco and alcoholic beverages) and other restricted or illegal goods according to Norwegian law. The “Low value goods” is defined as product price under NOK 3 000. It’s important to understand that the threshold of NOK 3000 is not determined by the total value of the parcel but by the value of each item in the same parcel. For example, if one parcel containing 2 products that is worth NOK 2000 each, it is still under the threshold and therefore covered by VOEC scheme. Shipping and insurance costs are not included when calculating the threshold.
Sometimes a supplier sells products for both under and over NOK 3 000. In this case, if the supplier wishes to use VOEC, the shipment then must be divided into two parcels – one parcel with goods under NOK 3 000 and another with goods over NOK 3 000. The goods over NOK 3 000 will be subject to regular customs clearance. To avoid that your customers have to handle the import procedures themselves, it’s recommended to register for regular VAT scheme in this case.
How do I report?
A company that is registered in VOEC scheme must charge VAT to private customers at the point of sales. A unique VOEC-number will be assigned to the company when the registration in VOEC is successful. The VOEC-number must be indicated/provided when the goods cross the Norwegian boarder. VAT is reported quarterly through the electronic portal www. altinn.no. The reporting periods and deadlines are as follow:
|Period||Reporting and payment due|
|1 January – 30 March||20 April|
|1 April – 30 June||20 July|
|1 July – 30 September||20 October|
|1 October – 31 December||20 January|
No VAT refund
The VOEC is a “pay only” scheme, which means a VOEC-registered company is not entitled to any VAT deductions. If a company has VAT expenses in Norway, it shall apply for VAT refund through the regular VAT refund scheme for non-stablished businesses.
We can help!
ECOVIS can assist with VOEC registration and VAT reporting to make sure your business is compliant to Norwegian regulations. Are you not certain about whether your company should be registered in VOEC? Contact ECOVIS for a free evaluation.