The EU One Stop Shop for watch dealers selling to consumers abroad

Most of what a European watch dealer sells to a consumer in another member state never goes through the EU One Stop Shop. The OSS was built for cross-border B2C sales, a dealer shipping to consumers in five countries looks like its obvious user, and then Article 35 of the VAT directive removes nearly the whole stock list: margin-scheme goods are excluded from the distance-sales rules. The scheme still matters, but for the edges of the business rather than the middle of it, and the edges are where the surprises live.

What the OSS is

Since July 2021, a business selling goods B2C across EU borders charges VAT at the buyer's country's rate, because the place of supply is where the transport ends. The One Stop Shop is the mechanism that makes this bearable: instead of registering for VAT in every country it ships to, the seller registers once, in its own member state, files one quarterly OSS return covering all cross-border B2C sales, and pays the foreign VAT through its own tax authority, which distributes it. Article 369f sets the return period and the deadline: the end of the month after each quarter, so 30 April, 31 July, 31 October and 31 January. Article 369k requires the underlying records to be kept for 10 years from the end of the year of the transaction.

There is a floor. Article 59c lets a seller established in one member state whose cross-border B2C sales stay under €10,000 a year, this year and last, keep charging home-country VAT and skip the destination rules entirely. Above the threshold, or by choice below it, destination VAT applies; an option exercised below the threshold “shall in any event cover two calendar years.”

Why margin-scheme watches stay out

Article 35 of Directive 2006/112/EC says it plainly: the distance-sales rule “shall not apply to supplies of second-hand goods, works of art, collectors' items or antiques” sold under the margin scheme. A margin-scheme sale is taxed where the transport begins. A Dutch dealer selling a margin-scheme Speedmaster to a consumer in Munich charges Dutch VAT on the margin, declares it in the ordinary Dutch VAT return, and the OSS never sees the transaction. The German buyer's location changes nothing.

This is worth stating twice because there are two ways to get it wrong. Margin-scheme sales do not belong in an OSS return, and they do not count toward the €10,000 threshold either, since the threshold measures distance sales and Article 35 says these are not distance sales. A dealer whose entire cross-border consumer business is margin-scheme watches files nothing new, registers nowhere new, and can stop reading here.

What a watch dealer actually puts through the OSS

The OSS covers whatever a dealer sells B2C across a border under normal VAT rules. In a watch business that is a shorter list than the stock list, but it is rarely empty. New watches bought from a brand or distributor on a VAT invoice, with the input VAT deducted, are normal-VAT goods. So are straps, buckles, boxes, winders, tools and parts sold through the webshop. So is any watch the dealer chose to sell under normal VAT rules instead of the margin scheme, an option Article 319 of the directive gives per individual sale and which dealers use when the buyer wants a full-VAT invoice.

The rate is the destination's, and the destinations differ more than most webshop checkouts admit:

Rates per Tax Foundation, January 2026. A Dutch dealer selling that €800 winder to a customer in Helsinki owes €204 of Finnish VAT and collects it at checkout, or eats the difference if the webshop showed one flat gross price for every country. Fixed gross pricing across the EU is a choice to earn 6.5 points less in Finland than in Germany. Some dealers accept that for a simple storefront; the ones who never did the arithmetic are not accepting it, just paying it.

The mechanics

Registration is with the dealer's own tax authority, the member state of identification, through its OSS portal. One registration covers all 27 member states. The quarterly return lists sales per destination country at that country's rate, one payment settles it, and the home authority forwards the money. The 10-year record requirement covers the data behind each return, which in practice means the webshop and invoicing records must say, per sale, where the goods went and which VAT treatment applied.

That last field is the one that matters in a mixed business. The paperwork is not hard. It is only hard to reconstruct in April from memory.

A quarter, worked

A Dutch dealer, over the €10,000 threshold, makes four consumer sales in Q3:

Four sales, two returns. The Munich sale is the largest and the only one the OSS never sees; the buyer's country set the rate on the Paris and Helsinki sales and had no bearing on the other two. The OSS return for the quarter has two country lines, €604 in foreign VAT, one payment to the Belastingdienst by 31 October.

What changes in 2028, and what does not

The rule that keeps margin-scheme watches out of the OSS is staying. The Commission's 2022 VAT in the Digital Age proposal would have deleted Article 35 outright, taxing cross-border B2C sales of second-hand goods in the buyer's country like any other distance sale and pulling them into the OSS. It did not survive. Council Directive (EU) 2025/516, adopted on 11 March 2025, leaves Article 35 standing, and the one place the adopted text touches the margin scheme is to exclude margin-scheme supplies from the new mandatory reverse charge. A dealer reading a briefing from 2023 that says otherwise is reading the proposal, not the law.

What arrives on 1 July 2028 answers a different problem: stock held abroad. The package extends the OSS to further B2C supplies and adds a scheme for transfers of a business's own goods to another member state, so that moving stock across a border no longer forces a VAT registration there. The call-off stock simplification closes with it, replaced by 30 June 2029. A dealer who keeps watches with a partner in Paris, or leaves stock behind after a fair, has been registering locally to do it. That is the registration the 2028 scheme is built to retire.

Nothing needs doing about that this quarter. What is worth doing this quarter is the sorting: know which sales are margin and which are normal VAT, per item, in the records, because the two-track filing prices a watch differently depending on the answer.

FAQ

Do my margin-scheme sales to consumers in other EU countries go in the OSS return? No. Article 35 of the VAT directive excludes margin-scheme goods from the distance-sales rules, so those sales take home-country VAT on the margin and go in the ordinary domestic return.

When do I have to charge the buyer's country's VAT? On B2C cross-border sales of normal-VAT goods, once those sales pass €10,000 a year across the EU, counting this year and last. Below that, home VAT is allowed; margin-scheme sales never count toward the threshold.

How often is an OSS return filed? Quarterly, due at the end of the month after the quarter: 30 April, 31 July, 31 October and 31 January. One return and one payment cover every member state shipped to.

Does selling B2B to another dealer go through the OSS? No. The OSS covers sales to consumers; a sale to a VAT-registered dealer in another member state is an intra-Community supply under its own rules, on the invoice and in the regular return.

Sources

Council Directive 2006/112/EC — Articles 33, 35, 59c, 311–332, 319, 369f, 369k

European Commission — The One Stop Shop (Union scheme rules, threshold, quarterly returns)

eClear — EU One-Stop-Shop: deadlines and margin-scheme exclusion

TIMEVAT — VAT One Stop Shop, EU scheme

Tax Foundation — 2026 VAT rates in Europe, updated 27 January 2026

Council Directive (EU) 2025/516 of 11 March 2025 (ViDA)

PwC Netherlands — ViDA formally adopted (1 July 2028 scope, call-off stock, reverse charge)

VATupdate — ViDA analyzed, part 9: the Commission's proposal to delete Article 35