The EU VAT One Stop Shop (OSS) rules came into force in July 2021. Under OSS, sellers who make cross-border sales to EU consumers can register for VAT in a single EU member state and file a single OSS return to cover their EU VAT obligations, rather than registering for VAT in every EU country they sell to.

Many UK-based sellers use OSS if they are dispatching goods from within the EU (for example, from Amazon's European fulfilment centres) to consumers in other EU countries.

Link My Books automatically separates your sales revenue into groups based on where orders are shipped and where they are dispatched from. For European Amazon seller accounts (post 31/12/2020), sales are broken down into the following groups:

Sales Shipped to UK — orders delivered to UK customers.
​Sales Shipped Outside UK, Dispatched From GB — orders delivered to non-UK customers, dispatched from warehouses in Great Britain.
​Sales Shipped Outside UK, Dispatched From Outside GB — orders delivered to non-UK customers, dispatched from warehouses outside Great Britain (e.g. Amazon's EU fulfilment centres).

Sales that are subject to EU VAT (including those covered by OSS) fall into the 2nd and 3rd groups above, depending on whether they were dispatched from GB or not.

Our default tax rates for these groups are:

Dispatched from GB → Zero Rated Income
​Dispatched from outside GB → No VAT

This is the question we hear most often from sellers using OSS — and it's a good one.

The key point is that Link My Books is designed to ensure your UK VAT return is accurate. From a UK VAT perspective, sales shipped outside the UK are either zero rated or outside the scope of UK VAT entirely — even though you may be collecting and remitting EU VAT on those same sales through OSS.

The EU VAT you collect through OSS is a separate obligation and is handled outside of your UK bookkeeping software (Xero or QuickBooks).

Most sellers in this position use a third-party EU VAT provider (such as SimplyVAT, Avalara, or hellotax) to calculate and file their OSS returns. Link My Books is designed to sit alongside these providers:

Link My Books handles your UK bookkeeping — ensuring your sales, fees, and tax rates are correctly mapped so your UK VAT return is accurate.
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​Your EU VAT provider handles the EU side — calculating your OSS liability and filing your OSS returns in the relevant EU member state.

Once your EU VAT provider confirms your OSS liability, you would record that payment in your bookkeeping software (Xero or QuickBooks) against the same sales account that the original sales were posted to. This backs out the EU VAT from the sales account, leaving only the correct net sales figure.

For a detailed walkthrough of how to record these EU VAT payments in Xero or QuickBooks, see our article: How to deal with EU VAT in Xero or QuickBooks with Link My Books

Marketplaces such as Amazon, eBay, and Etsy may also collect, withhold, and remit EU VAT on your behalf for certain transactions. Link My Books handles this automatically through the marketplace VAT responsible grouping in the Accounts & Taxes wizard.

EU VAT obligations can be complex, especially if you are selling across multiple countries or storing inventory in the EU. We always recommend speaking to your accountant or tax advisor regarding OSS registration, EU VAT compliance, and how to account for your EU VAT liabilities alongside your UK VAT return.

If you don't currently have an EU VAT provider, our support team can introduce you to one — just get in touch.