This article explains the One-Stop Shop (OSS) system for Value Added Tax (VAT) in Bulgaria, implemented in July 2021.
What is the OSS System?
The OSS system allows EU businesses to register for VAT and submit returns in just one EU country, streamlining the process for those selling to customers across the bloc. It eliminates the need to navigate individual distance selling thresholds in each member state.
Who Can Use the Bulgarian OSS System?
- EU-based Businesses: This system is designed for businesses established within the European Union selling products to EU consumers.
Understanding Intra-Community Supplies
The OSS system applies to specific types of transactions:
- Intra-Community Distance Sales of Goods: Goods shipped by the supplier from one EU country to another EU country to a non-taxable person (consumer).
- Intra-Community Services: Services provided to non-taxable persons in any EU country.
Exceptions for Goods:
- New vehicles
- Goods installed at the supplier's expense
- Second-hand goods
- Works of art
Types of OSS Registration
- Mandatory Registration: Businesses exceeding €10,000 in revenue from remote sales and services within the previous or current year must register for OSS.
- Voluntary Registration: Businesses can choose to register voluntarily even before reaching the €10,000 threshold.
Registering for the Bulgarian OSS System
- Submit a Registration Statement with an electronic signature to the National Revenue Agency (NRA) in Bulgaria.
- The NRA will issue an Act of Registration within 14 days.
- Registration takes effect on the 1st day of the quarter following the quarter the statement is submitted.
Submitting OSS Declarations
Once registered, businesses must submit quarterly OSS declarations separate from regular VAT returns. These declarations detail each supply with its tax base, accrued VAT, and applicable tax rate for each EU country.
Important Note for Suppliers
Suppliers must retain all relevant documents for each sale, including:
- Bill of lading
- Transport documents
- Customer confirmation of receipt
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
