What is the VAT OSS procedure and who can use it in 2026?
The VAT OSS procedure is designed for companies performing intra-Community distance sales of goods and providing digital services to consumers (B2C) that have exceeded the annual turnover threshold of EUR 10,000.
When does the VAT OSS obligation start?
The EUR 10,000 limit (approximately PLN 42,000) applies to the sum of all B2C sales to all European Union countries combined. Until you cross this threshold, you can settle Polish VAT (usually 23%). After crossing it, you have two options:
- Register for VAT in every country where you ship goods (expensive and time-consuming).
- Register for the VAT OSS system in Poland (the solution recommended by Progress Holding).
Remember that this procedure applies to transactions with private individuals. B2B sales are still settled under the Intra-Community Supply of Goods (ICS) rules with a 0% rate.
What VAT rates apply to OSS settlements?
In the OSS procedure, you must apply the VAT rates appropriate for the country where the consumer (the buyer) is located, not the Polish rate.
If you sell shoes to a customer from Germany, you apply German VAT (19%). If the customer is from Hungary, you add 27% VAT. This is crucial for determining your store’s margin. At Progress Holding, we help configure accounting systems to correctly assign tax rates.
| Feature | General rules (without OSS) | VAT OSS procedure |
|---|---|---|
| Declarations | Separate in each EU country | One declaration in Poland (VIU-DO) |
| Tax payment | Multiple transfers in foreign currencies | One transfer in EUR to the Polish tax office |
| Service costs | Very high (multiple accountants) | Low (one accounting office) |
How to register for VAT OSS in Poland?
Registration takes place by submitting the VIU-R form to the Head of the Second Tax Office Warszawa-Śródmieście, which handles the OSS procedure for all of Poland.
You submit the application electronically via the e-Deklaracje system or the Tax Portal. You must do this before the start of the quarter in which you want to use the procedure, or immediately after exceeding the EUR 10,000 limit. At Progress Holding, we handle this process for our clients, ensuring timely submission of documentation and data verification.
Do Amazon FBA and warehousing goods abroad fall under OSS?
No, using foreign warehouses (e.g., within Amazon FBA or Zalando Fulfillment) usually still requires local VAT registration in the country of storage.
The OSS procedure covers the shipment of goods from Poland directly to a consumer in another EU country. If you move your own goods to a warehouse in Germany, and from there they are sent to a German customer, a so-called non-transactional movement of goods occurs. In this case, you must have a German VAT number. Progress Holding offers support in analyzing your logistics model to avoid tax errors.
How does it look in practice? Progress Holding experience
Based on accounting audits conducted for over 200 e-commerce companies, we notice one recurring mistake. Entrepreneurs often confuse the EUR 10,000 limit with the limit for subject-based VAT exemption in Poland (PLN 200,000). These are two separate regulations.
Many clients come to us with arrears because they did not know that sales on Allegro or eBay to Germany count towards the OSS limit. Our intervention often allows for correcting declarations and avoiding severe penalties from foreign tax authorities. If you plan to expand, consult with us before sending the first package abroad.
Frequently asked questions (FAQ)
Do I need to run a company in Poland to use OSS?
Yes, this system is available for companies with a registered office or fixed establishment in Poland. If you are a foreigner, Progress Holding will help you with registering a company in Poland and obtaining the necessary tax numbers.
How often are declarations submitted in the OSS system?
VIU-DO declarations are submitted quarterly, by the end of the month following the end of the quarter. Even if there were no sales in a given quarter, and you are registered, you are obliged to submit a “zero” declaration.
What is the currency exchange rate for tax payment?
The due VAT tax is paid in EURO currency. You convert the transaction value according to the ECB exchange rate from the last day of the settlement period. Accurate calculations are carried out by our accounting office as part of ongoing service.
The VAT OSS system is a powerful simplification, but it requires precision in recording sales. Errors can result in the need to register for VAT in every EU country retroactively, which generates huge costs. Do not risk the safety of your business.
Do you need professional support in e-commerce accounting? Contact us at Progress Holding at +48 603 232 418 or via email at office@progressholding.pl. We will take care of your taxes so you can focus on growing your sales.
