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Import and Export Manual for low value shipments

3.1.5. Exchange rate

When the supplier or electronic interface opts for the import regime, all distance sales of imported goods not exceeding EUR 150 must be declared in the IOSS . However, despite all its advantages, the IOSS does not apply to sales of goods worth more than EUR 150. In order to determine whether the IOSS applies to a particular sale, the supplier or electronic interface must use the exchange rate established by Article 91(2) of the VAT Directive (the daily exchange rate published by the European Central Bank) applicable on the day payment was accepted, regardless of when the goods are actually imported into the EU .

At the time of import, the EUR 150 threshold is checked again for customs purposes, this time using the exchange rate applicable to determine the customs value, i.e. the exchange rate valid at the time the customs declaration is accepted for release into free circulation. The latter is established the previous month and applies to all imports taking place in the current month.

In order to avoid situations where a price of less than EUR 150 at delivery exceeds the threshold of EUR 150 at import, it is recommended that the seller or the electronic interface using the IOSS indicate on the invoice accompanying the shipment the price in euros that was determined at the time payment for the goods was accepted. This value will be accepted by the customs authorities at the time of import of the goods into the EU and, thus, a possible double taxation of VAT on import will be avoided.

In case the importing Member State uses a currency other than the euro, it is recommended that the Member State accepts the amount indicated in euros on the invoice as indicated above, for both customs and tax purposes.

Examples:

1. Distance sale of goods under the IOSS regime whose end-use is Germany and which enter the EU through Poland where they are declared for release into free circulation. The invoice accompanying the shipment is issued in Euros and the Polish customs authorities accept the value in Euros.

  • It is not necessary to convert the invoice amount from Euro to national currency for the purpose of checking whether the shipment qualifies for duty-free status, IOSS and the H7 dataset can be used.
  • To calculate the VAT to be paid, the monthly rate of article 53, paragraph 1, letter a) must be applied in the declaration process (on the penultimate Wednesday of each month, starting from the first day of the following month) and the amount of the invoice must be converted to national currency.

2. Distance sale of goods under the IOSS regime whose end-use is the Member State « A » and which enter the EU through the Member State « B » where they are declared for release into free circulation. The invoice accompanying the shipment is expressed in USD .

The submission must be checked to ensure it meets the conditions for IOSS and the H7 dataset. This check is carried out by converting the invoiced amount (USD) into the national currency using the exchange rate valid at the time the customs declaration is accepted for release into free circulation [for example, the exchange rate based on Article 53, paragraph 1, letter a) of UCC and Article 146 of AE UCC ]. This converted amount now expressed in the national currency should be compared with the euro value converted into the national currency of non-euro area Member States calculated on the basis of Article 53(2) UCC and Article 48(2) EAC (annually).

Example

Distance selling of goods under the IOSS scheme with end-use Hungary. Goods enter the EU through Hungary, where they are declared for release into free circulation. The invoice accompanying the shipment is expressed in USD.

To check whether the shipment meets the conditions for using the customs declaration with data set H7, the invoiced amount (in USD) must be converted into Hungarian currency ( HUF ) using the exchange rate in effect at the time the customs declaration is accepted for release into free circulation (the exchange rate is set in the previous month and applies to all imports taking place in the month in question). The next step is to compare the amount converted in HUF with the annual threshold value expressed in HUF corresponding to the threshold of EUR 150. If the amount converted to HUF is less than the annual threshold, the customs declaration with data set H7 can be used. To calculate the VAT payable, the exchange rate in accordance with Article 53(1)(a) UCC and Article 146 EA UCC must be used (the exchange rate is set in the previous month and applies to all imports that take place in the month in question).

If the invoice amount is expressed in a foreign currency and at the time of import the conversion is around EUR 150, customs authorities are advised to adopt an appropriate strategy for controlling the intrinsic value of EUR 150. See chapter 4, question 21, of the Explanatory Notes on VAT.