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Glossary

Updated

 

EC Sales List

The European Community Sales List (EC Sales List or ESL) is a report filed by businesses registered for VAT in the EU.

EC Sales Lists help prevent fraud by allowing EU governments to check that the correct amount of VAT is being declared in cross-border transactions.

You’ll need to file an EC Sales List if: 

  • You sell goods from one EU country to a VAT registered business in another
  • You sell services to a business registered for VAT in the EU and the reverse charge mechanism applies
  • You move goods you own from storage in one EU country to another
  • You move goods under the call-off stock simplification (this only applies in some countries, and the simplification will be abolished in 2028) 

How often you have to file an EC Sales List depends on the country where you’re registered for VAT. 

EORI Number

An Economic Operator Registration Identification (EORI) number is used by customs authorities in the EU and the UK to identify importers.

Fiscal Representative

A person or business that acts as a liaison between you and the Tax Authorities. They are often jointly liable for the VAT owed by non-EU companies.

Importer of Record (IOR)

The Importer of Record is the person or business responsible for paying import VAT and duties on goods being imported.

Import One Stop Shop (IOSS)

An EU VAT scheme that allows consignments of goods with an intrinsic value of €150 or less to be imported into the EU on a single return. 

Incoterms

'Incoterms' is short for "International Commercial Terms". They are international shipping rules that tell buyers and sellers who is responsible for what, when shipping goods across borders.

  • Delivery Duty Paid (DDP)
    An incoterm used to show that the seller is responsible for all risks and costs associated with shipping goods to an agreed destination. That responsibility covers damage, loss, imports duties and import VAT. Responsibility shifts to the buyer when the goods are delivered.
  • Delivery Duty Unpaid (DDU)
    An older incoterm, replaced by Delivery at Place (DAP) in official usage but used interchangeably. DDU is used to show that the seller is responsible for goods as they are being shipped up until they enter the destination country. Import formalities like import duties and VAT are the responsibility of the buyer. Usually shipping from the customs facility to the buyer are included in the initial shipping cost, but if not, the buyer is responsible for covering that as well.
  • Delivered At Place (DAP)
    An incoterm used to show that the seller is responsible for goods as they are being shipped to an agreed-upon destination, but not any import formalities like import duties and VAT. Once delivered, responsibility for the goods shifts to the buyer.

Input VAT

The VAT that businesses pay when they make purchases or import goods into a country.

Non-Union One Stop Shop (Non-Union OSS)

An EU VAT scheme that allows non-EU businesses to collect VAT on the supply of services to customers across the EU and report it on a single return. 

One Stop Shop (OSS)

An EU VAT scheme that allows EU-based businesses to collect VAT on sales of goods all over the EU and report them all on one return. 

Output VAT

The VAT businesses collect on their sales and pass to the Tax Authorities on their VAT returns.

Place of Establishment

The country and address from where your business is run.

Place of Supply

The rules determining which country's VAT rules apply when goods are sold.

Postponed VAT Accounting

Postponed VAT Accounting (PVA) is a scheme that allows VAT-registered businesses to pay import VAT on their VAT return rather than up-front at customs. PVA schemes have two main benefits for businesses:

  • You can pay all your import VAT at once in a set period, making it easier to manage your cash flow
  • You can reclaim your import VAT at the same time as reporting it, meaning money might not even have to leave your account

Not every country has a PVA scheme. Those that do usually have rules about who can use the scheme and what can be imported under it.

Power of Attorney

A legal document that grants another the right to act on your behalf.

SEPA

The Single Euro Payments Area (SEPA) is an initiative that makes it easier to make and receive payments in euros across European countries.

Tax Authority

The government body in charge of tax in a country or region.