The Norwegian tax administration has introduced a simplified VAT regulation – VAT On E-Commerce (VOEC). Smaller B2C suppliers or marketplaces that sell low value goods and do not reach the NOK 50,000 threshold also benefit from simplified customs procedures. Ecovis’ Norwegian experts explain what will apply to which companies in the future.
Who must register?
VAT On E-commerce (VOEC) is a simplified VAT scheme for foreign B2C suppliers or marketplaces selling low value goods below NOK (Norwegian krone) 3,000 (about EUR 300). Unlike ordinary VAT, the new scheme does not require the seller to register a company in Norway. The seller is obliged to register for VOEC when revenue exceeds NOK 50,000 during a 12-month period. Companies that do not reach the NOK 50,000 threshold can also choose to register voluntarily. If the shipment is covered under the VOEC scheme, it is also subject to simplified customs procedures with no customs declaration. VOEC is largely similar to the EU MOSS-scheme (Mini-One-Stop-Shop).
What are “low value goods”?
The VOEC scheme includes all low value goods except foodstuffs, goods subject to excise duties (tobacco and alcoholic beverages) and other goods that are restricted or illegal according to Norwegian law. “Low value goods” are defined as having a product price under NOK 3,000. It is important to understand that the threshold of NOK 3,000 is not determined by the total value of the package but by the value of each item in the same package. For example, if one package contains 2 products worth NOK 2,000 each, it is still under the NOK 3,000 threshold and therefore covered by the VOEC scheme. Shipping and insurance costs are not included when calculating the threshold.
Sometimes a supplier may sell products that are both under and over NOK 3,000. In this case, if the supplier wishes to use VOEC, the shipment must be divided into two packages – one with goods under NOK 3,000 and another with goods over NOK 3,000, explain the Ecovis experts. The goods over NOK 3,000 will be subject to regular customs clearance. In this case, to avoid your customers having to deal with import procedures themselves, it is recommended that you register for the regular VAT scheme.
How do I report?
Companies registered for the VOEC scheme must charge VAT to private customers at the point of sale. A unique VOEC number will be assigned to the company upon successful registration. 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.
No VAT refund
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 must apply for a refund through the regular VAT refund scheme for non-established businesses.
For further information please contact:
Ding Xu, Partner, ECOVIS Ardur Tax AS, Oslo, Norway
Who must register?
VAT On E-commerce (VOEC) is a simplified VAT scheme for foreign B2C suppliers or marketplaces selling low value goods below NOK (Norwegian krone) 3,000 (about EUR 300). Unlike ordinary VAT, the new scheme does not require the seller to register a company in Norway. The seller is obliged to register for VOEC when revenue exceeds NOK 50,000 during a 12-month period. Companies that do not reach the NOK 50,000 threshold can also choose to register voluntarily. If the shipment is covered under the VOEC scheme, it is also subject to simplified customs procedures with no customs declaration. VOEC is largely similar to the EU MOSS-scheme (Mini-One-Stop-Shop).
What are “low value goods”?
The VOEC scheme includes all low value goods except foodstuffs, goods subject to excise duties (tobacco and alcoholic beverages) and other goods that are restricted or illegal according to Norwegian law. “Low value goods” are defined as having a product price under NOK 3,000. It is important to understand that the threshold of NOK 3,000 is not determined by the total value of the package but by the value of each item in the same package. For example, if one package contains 2 products worth NOK 2,000 each, it is still under the NOK 3,000 threshold and therefore covered by the VOEC scheme. Shipping and insurance costs are not included when calculating the threshold.
Sometimes a supplier may sell products that are both under and over NOK 3,000. In this case, if the supplier wishes to use VOEC, the shipment must be divided into two packages – one with goods under NOK 3,000 and another with goods over NOK 3,000, explain the Ecovis experts. The goods over NOK 3,000 will be subject to regular customs clearance. In this case, to avoid your customers having to deal with import procedures themselves, it is recommended that you register for the regular VAT scheme.
How do I report?
Companies registered for the VOEC scheme must charge VAT to private customers at the point of sale. A unique VOEC number will be assigned to the company upon successful registration. 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.
No VAT refund
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 must apply for a refund through the regular VAT refund scheme for non-established businesses.
For further information please contact:
Ding Xu, Partner, ECOVIS Ardur Tax AS, Oslo, Norway
