On 1 January 2019 there will be two changes to the Mini One Stop Shop (MOSS) scheme, one of which will be very helpful to small businesses.

MOSS allows businesses to account for their EU VAT obligations in respect of supplies of digital services to non-business customers in one place, rather than having to register in all the EU countries where their customers live.

New EU sales threshold

Businesses whose sales accounted for through MOSS are less than £8,818 (€10,000) in a calendar year and in the previous calendar year can account for those sales as if made in the UK and deregister from MOSS. A business can choose to stay in MOSS but must elect to do so.

The threshold does not apply to businesses based outside the EU and so if the UK leaves the EU without a deal UK businesses will not be able to take advantage of this threshold after 29 March 2019.  In the event of no deal UK businesses will not be able to use the current MOSS scheme but will have to use the “non-union scheme” in one of the remaining EU member states, unless the next change applies.

Non-EU businesses

Businesses based outside the EU that are VAT registered in an EU member state for other purposes will also be able to use MOSS from 1 January 2019. As noted above, the £8,818 threshold does not apply to businesses that are based outside the EU.