What is EORI, TaxID/VAT & IOSS in Shippo?

Filing the right tax information keeps your packages moving through customs without delays. Here's a breakdown of the key tax identifiers required for shipping, and how to add them to your shipments in Shippo.

EORI

An EORI (Economic Operators Registration and Identification) number is a unique identifier required for customs clearance within the European Union. It applies to all customs operations, including import, export, and transit.

Why is an EORI number important?

• It supports efficient customs clearance, along with statistical and security processes.
• A single EORI number works across all EU Member States, simplifying identification for both economic operators and customs authorities.

Who needs an EORI number?

• Economic operators in the EU: Businesses established in the EU's customs territory need an EORI number for customs activities.
• Economic operators outside the EU: Businesses outside the EU need to register for an EORI number for activities like customs declarations, Entry Summary (ENS) and Exit Summary (EXS) declarations, temporary storage declarations, or acting as a carrier.
• Other persons: Non-business entities may need an EORI number if required by national or EU legislation, or for specific customs-related activities.

How to apply for an EORI number

• EU-based operators: Apply through the customs authority in the EU Member State where your business is established.
• Non-EU operators: Register in the Member State where your first customs operation will take place. If you have multiple establishments in the EU, you can register in any of those Member States.

EORI number format

An EORI number includes:

• A 2-letter country code for the issuing Member State
• A unique identifier within that Member State, up to 15 alphanumeric characters

For example: DE123456789 (DE = Germany).

For more on EORI, visit the European Commission website.

When you'll need a GB EORI number

You'll need a GB EORI number if you're moving goods:

• Between Great Britain (England, Scotland, and Wales) or the Isle of Man and any other country, including the EU
• Between Great Britain and Northern Ireland
• Between Great Britain and the Channel Islands
• Between Northern Ireland and countries outside the EU

Businesses without a GB EORI can apply for free here.

TaxID/VAT

Tax ID and VAT codes determine how merchants get assessed for tax purposes during cross-border trade. You may need multiple numbers depending on where you ship from and to, since tax requirements vary by region.

Tax ID in the United States

The Employer Identification Number (EIN) is the tax ID used in the US. US Customs and Border Protection (CBP) requires all import/export filings to include the shipper's EIN.

VAT in Europe and beyond

VAT (Value Added Tax) is used widely across Europe, the UK, and many other countries. VAT numbers serve a similar purpose to the EIN, but apply specifically in regions where VAT is used.

For international shipments, make sure the right tax ID or VAT number is included in your customs declarations to stay compliant with local regulations.

IOSS (FedEx, UPS, DHL Express, DHL eCommerce, and USPS only)

New VAT rules for cross-border ecommerce (effective July 1, 2021)

The EU updated VAT rules for cross-border business-to-consumer (B2C) ecommerce to simplify the process, reduce barriers, and address challenges around VAT for distance sales and low-value consignments. Here's a summary of the key changes.

Simplified registration through the One Stop Shop (OSS)

Online sellers, including marketplaces and platforms, can register in a single EU Member State to handle VAT declarations and payments for all their distance sales of goods and cross-border services across the EU. This cuts administrative costs by up to 95% and removes the need to register for VAT separately in every EU country.

Simplified VAT collection for imported goods

Two new measures make VAT collection easier for goods valued at €150 or less:

• Import One Stop Shop (IOSS): Simplifies VAT declaration and payment for low-value imports from countries or territories outside the EU.
• Special Arrangements: Available for distance sales of goods up to €150 when IOSS isn't used.

EU-wide threshold of €10,000

The previous country-specific thresholds for distance sales of goods have been replaced with a single EU-wide threshold of €10,000. Below that threshold, VAT can be applied in the seller's country of establishment for telecommunications, broadcasting, and electronic (TBE) services, and for distance sales of goods.

Removal of VAT exemption for small consignments

The previous VAT exemption for imported consignments valued up to €22 no longer applies. All goods imported into the EU are now subject to VAT.

For more information, visit the European Commission website.

VAT updates for the EU and UK (effective 2021)

VAT rules for the EU and UK changed significantly in 2021, affecting how merchants charge, collect, and remit VAT on cross-border sales.

UK VAT changes (effective January 2021, post-Brexit)

Removal of the VAT de minimis threshold: Orders up to £135 used to be VAT-free. Now, VAT is due on all purchases, regardless of value.

Merchant responsibilities: Merchants must charge and collect VAT at the time of purchase for shipments up to £135:

• B2C (business-to-customer): VAT is charged upfront on all orders.
• B2B (business-to-business): VAT rules stay the same for shipments above £135.
• C2C (customer-to-customer):
  • Orders up to £39: exempt from VAT and duties.
  • Orders between £39 and £135: VAT applies, no duties.
  • Orders above £135: both VAT and duties apply, paid by the shopper.

Merchants need to send shipments as Delivered Duty Paid (DDP) to comply, which means collecting VAT (typically 20%) from the shopper upfront. Shippo defaults to Delivered Duty Unpaid (DDU), so you may need to adjust your customs declarations accordingly.

VAT registration: Merchants selling to UK customers need a GB VAT number if they don't already have one, and must file VAT returns periodically. Learn more: UK VAT Returns.

EU VAT changes (effective July 2021)

Removal of the VAT de minimis threshold: Orders up to €150 used to be VAT-free. Now, VAT is due on all purchases, regardless of value.

Simplified VAT collection: Merchants can use the Import One Stop Shop (IOSS) for shipments valued up to €150 to simplify VAT declaration and payment. For shipments over €150, or when IOSS isn't used, VAT and duties get calculated at customs.