E-commerce VAT France 2026: OSS, IOSS, Marketplaces and Distance Sales — Complete Overview

Up to date as of 12 May 2026. E-commerce VAT is one of the most underestimated compliance topics for French online sellers. As soon as you sell to private individuals in other EU countries, import goods from outside the EU, or sell through a marketplace, the applicable VAT rules change depending on the flow, the destination country, the customer's status, and the sales channel. This structured overview by Cabinet Hayot Expertise in Paris sets out the rules in force in 2026, the key decisions to understand, and the most common errors seen in e-commerce files.

Executive summary (55 words): In 2026, e-commerce VAT rests on four pillars: the €10,000 OSS threshold for B2C intra-EU sales (CGI art. 298 sexdecies F), IOSS for non-EU imports under €150 (art. 298 sexdecies G III), the deemed supplier rule for marketplaces (art. 256 V CGI), and DAC7 which cross-references your transaction data with platform declarations submitted to the French tax authority since January 2024.

The VAT of a traditional Paris retailer is straightforward: collect 20% on French sales, file a CA3 return, deduct input VAT on purchases. As soon as an e-commerce business crosses borders, three variables transform the mechanics: the customer's status (private individual or business), the place where goods are delivered, and — since 1 July 2021 — the legal identity of the actual seller when a marketplace is involved.

In practice, a Paris-based seller shipping cosmetics to private individuals in Germany, Italy, and Belgium while using Amazon FBA does not fall under a single regime. They may simultaneously be subject to Union OSS for direct sales, the deemed supplier rule for Amazon sales, and IOSS for imported restocking shipments from outside the EU. The first discipline to master is a flow mapping exercise, not a software configuration task.

The threshold rule (CGI art. 298 sexdecies F)#

Since 1 July 2021, any business established in France that sells goods to private individuals in other EU Member States must apply the VAT rate of the buyer's country as soon as its B2C intra-Community sales exceed €10,000 excluding VAT in the current or preceding calendar year. This threshold applies collectively across all Member States — not per country.

Below the threshold, you may choose to apply French VAT. But this choice requires continuous monitoring of the cumulative total: a November promotional campaign can push a Shopify store over the threshold and trigger Union OSS obligations from the following January.

Union OSS in practice: how it works#

The Union OSS allows you to consolidate, in a single quarterly return filed on the impots.gouv.fr portal, all B2C intra-Community sales. You do not need to register for VAT in each destination country: you declare and pay in France, and the DGFiP distributes the amounts to the relevant Member States. The return is quarterly (March, June, September, December) and payment is due within the month following the end of each quarter.

A critical point: the OSS does not exempt you from applying the correct VAT rate for each destination country. Delivering to a buyer in Germany requires applying 19% (or 7% for German reduced rates depending on the nature of the good), not 20%. Your invoicing software or e-commerce platform must be configured accordingly.

VAT rates by EU country: general rule and key references#

The applicable rate is the destination country rate for the final consumer. Key standard rates for major markets:

Our reading — Cabinet Hayot Expertise, Paris: Rate configuration by country is the first operational bottleneck we encounter in the e-commerce files we advise. A misconfigured rate on Shopify or WooCommerce silently propagates across hundreds of orders before being detected. A VAT configuration review must precede any scale-up into a new European market.

The mechanism (CGI art. 298 sexdecies G III)#

The IOSS (Import One-Stop Shop) regime applies to distance sales of goods imported from third countries, with an intrinsic value below €150, to private individuals in the EU. The seller — or the facilitating electronic interface — collects VAT at the destination country rate at the point of online sale. The parcel is declared at customs with the IOSS number and enters the EU exempt from customs VAT. VAT is remitted monthly via the IOSS return.

The customer experience benefit is significant: the buyer pays VAT at the time of purchase and receives no customs surprise on delivery. For the seller, the conversion rate improves and delivery disputes related to customs charges disappear.

Without IOSS: what happens in practice#

Without an IOSS number, the carrier collects VAT on import from the recipient (or advances it and invoices it back). This creates unexpected costs for the buyer, higher delivery abandonment rates, and complaints. For sellers shipping from China, the United States, or the United Kingdom to French or European customers, IOSS has become a commercial prerequisite as much as a tax obligation.

IOSS and marketplaces: who handles what?#

When you sell through a deemed supplier marketplace (Amazon, Cdiscount, etc.) for imports under €150, the marketplace holds the IOSS number and manages the declaration. If you sell directly through your own store, you must obtain your own IOSS number via the impots.gouv.fr portal or an authorised customs intermediary.

What the rule changes since 1 July 2021#

Article 256 V of the CGI, transposing EU Directive 2017/2455 as amended, establishes that certain electronic interfaces (marketplaces, platforms) are deemed to have made the sale themselves when they facilitate deliveries of goods to private individuals in the EU. Concretely: Amazon, Cdiscount, and equivalent platforms collect, declare, and remit VAT instead of the third-party seller for transactions covered by the rule.

The rule applies in two cases: (1) sales of imported goods from outside the EU with a value below €150 to EU private individuals, regardless of the seller's location; (2) sales of goods already in the EU to EU private individuals by sellers established outside the EU.

What this means for the third-party seller#

You are no longer liable for VAT on transactions covered by the rule. However, you must retain documentation proving that the sale passed through the marketplace and that VAT was managed by it. Amazon Seller Central or Cdiscount Pro reporting interfaces provide this data, but it must be reconciled with your accounts.

The underestimated risk: many third-party sellers continue to include these sales in their OSS or CA3 filings, creating double reporting. This is one of the most frequent corrections we make when reviewing e-commerce VAT files in Paris.

For a detailed line-by-line reconciliation workflow between your marketplace exports and your OSS/IOSS filings, see our dedicated article: VAT OSS/IOSS reconciliation and international marketplaces 2026.

The B2B vs B2C supply chain (BOI-TVA-CHAMP-20-20)#

Drop-shipping creates a three-party chain: the supplier (manufacturer or wholesaler), the online seller (your store), and the end customer. For VAT purposes, physical delivery only occurs once — from the supplier to the end customer — but it generates two taxable transactions: the sale from supplier to seller (B2B) and the sale from seller to customer (B2C).

Under BOI-TVA-CHAMP-20-20, the place of supply follows general rules: VAT is due in the country of physical arrival of the goods for B2C sales. If your supplier is in China and your customer is in France, French import VAT applies on the first transaction. If your supplier is in Poland and your customer in Germany, intra-Community rules apply depending on the amounts and your OSS status.

Drop-shipping and OSS: when the threshold applies#

If you conduct B2C drop-shipping from stock located in France or another Member State to private individuals in other Member States, the €10,000 threshold applies. Once crossed, you must apply the destination country VAT rate and use the Union OSS or, depending on flows, local VAT registration.

VAT-exempt exports (CGI art. 262 I)#

Deliveries of goods dispatched or transported outside EU territory benefit from the VAT exemption provided by article 262 I of the CGI. This exemption is conditional on retaining proof of export: customs declaration (SAD/EX1), transport document, or in certain cases a certificate of shipment. Without this proof, the exemption may be challenged during a tax audit.

Post-Brexit UK: a specific case#

Since 1 January 2021, the United Kingdom is a third country. Sales to UK buyers are VAT-exempt exports on the French side, but they are subject to UK VAT (standard rate 20%) on import into the UK. If your sales volume to the UK exceeds the UK VAT registration threshold (£85,000 — to be verified), you may have a UK VAT obligation. This point goes beyond French tax law and must be examined with a UK-qualified adviser.

Impact of a return on declared VAT#

A product return generates an adjustment to the VAT initially collected. If you declared this VAT via the Union OSS, the adjustment is made on the next quarterly OSS return (deducting the amount refunded to the customer from the total to be remitted). If VAT was declared via your French CA3, the credit note is processed under standard rules: issue a credit note invoice, deduct on the next declaration period.

Shipping costs refunded in connection with a return follow the same treatment as the main goods (VAT rate of the good, or zero-rated if the customer is outside the EU). Documentary discipline — retaining proof of return, tracking numbers, dates — is essential for clean reconciliation.

Shipping costs charged to the customer are classified as an ancillary supply to the main delivery. They follow the VAT rate of the main good delivered. If you ship an item subject to 10% VAT, shipping is taxed at 10%. If you sell an exempt or exported good, shipping shares this exemption. In the case of a mixed-rate order, the treatment must be clarified and documented. Never apply 20% to shipping by default without checking the rate applicable to the main goods.

DAS2 obligations (CGI art. 240)#

If you pay commissions to influencers, affiliates, or content creators to promote your products, the DAS2 declaration is mandatory as soon as amounts exceed €1,200 per beneficiary per calendar year. This obligation is independent of VAT but is frequently overlooked in e-commerce structures. The DGFiP cross-references DAS2 filings with the income declarations of the recipients.

For VAT purposes, if the influencer or affiliate is a VAT-registered business, they must invoice with VAT. If they are a micro-entrepreneur not subject to VAT, the VAT question does not arise on their side, but your DAS2 obligation remains.

What the DAC7 directive requires (CGI art. 1649 ter A)#

The DAC7 directive, transposed into article 1649 ter A of the CGI, obliges digital platform operators (marketplaces, service platforms, rental platforms) to declare annually to the DGFiP the revenues received by active sellers on their platform. The first declaration covering the year 2023 was submitted in January 2024. Data declared for 2024 and 2025 is now available to the DGFiP.

What this means in practice in 2026#

The DGFiP now holds, for each active seller on Amazon, Etsy, Vinted, Airbnb, or any declaring platform, a record of receipts. This figure is cross-referenced with your VAT returns (CA3, OSS, IOSS) and your income declarations. Any unexplained discrepancy constitutes an automatic audit trigger. Sellers who had omitted to declare part of their marketplace sales are exposed from 2026 onwards to assessments accompanied by penalties.

In practice: retain your seller data exports (Amazon Seller Central, Etsy Shop Stats, etc.) for the past three years and ensure the amounts reconcile line by line with your tax filings. This is one of the first checks we perform during a VAT e-commerce audit at Cabinet Hayot Expertise.

Extension of the deemed supplier rule from 2025#

The ViDA directive (VAT in the Digital Age), adopted by the EU Council in November 2024, extends the deemed supplier rule to new categories of platforms from 2025, notably in the passenger transport on demand and short-term rental sectors (type Airbnb, Booking). These platforms become liable for VAT instead of individual service providers, following the model that has applied since 2021 for goods marketplaces.

Real-time digital reporting: horizon 2028#

The ViDA reform also provides for the introduction of a real-time digital reporting system for intra-EU transactions (B2B e-invoicing and per-transaction VAT reports). This project, scheduled for 2028, will transform the relationship between businesses and European tax authorities. France has already anticipated part of this evolution with its mandatory e-invoicing reform (PPF/PDP), the phased rollout of which began in 2026. The articulation between the French reform and the ViDA framework remains to be clarified (BOFiP publication confirmation pending).

An e-commerce business registered for Union OSS and IOSS manages three parallel declaration flows:

• French CA3: VAT on French sales (B2C France, B2B EU with reverse charge, imports ≥ €150), input VAT on French purchases and services.
• Union OSS return (quarterly): VAT collected on B2C sales to private individuals in other EU Member States, at each destination country's rate. No input VAT deduction on this return.
• IOSS return (monthly): VAT collected on distance sales of imported goods under €150 to EU private individuals, at the destination country rate. Monthly return, monthly payment.

These three flows must be reconciled against accounting records, logistics exports, and marketplace reports. An unreconciled discrepancy is an error waiting to be detected.

Error 1: including marketplace sales in the OSS that the marketplace already covers#

B2C sales on Amazon or Cdiscount covered by article 256 V of the CGI must not appear in your OSS return. The marketplace files. Including these sales in your OSS creates double reporting and excess VAT remitted in error. This is one of the most frequent corrections in VAT e-commerce audits.

Error 2: not monitoring the €10,000 threshold#

Many small e-commerce stores are below the threshold at the start of the year and cross it during a promotional campaign. The switch to Union OSS obligations can occur mid-year, requiring retroactive application of the destination country VAT rate from the moment of crossing. Monthly monitoring of the cumulative B2C intra-Community total is essential.

Error 3: applying the French VAT rate by default across EU countries#

This is the most common configuration error. The French rate of 20% is not the default rate across Europe. Each country has its own standard and reduced rates, and the nature of the good may qualify for a reduced rate in one country but not in another.

Error 4: failing to retain proof of export for non-EU sales#

The export exemption (art. 262 I CGI) is conditional on retaining proof of departure from EU territory. A tax audit that cannot find this proof can challenge the exemption and reinstate VAT with penalties.

Error 5: ignoring the consistency between DAC7 data and VAT returns#

See the DAC7 section above. It is in 2026 that the first DGFiP cross-reference checks are likely to generate automatic requests for justification. A documented and explained discrepancy is manageable; an unexplained one is not.

E-commerce VAT is a mapping exercise before it is a compliance exercise. In the e-commerce files we advise in Paris, the problem is rarely a lack of knowledge of OSS or IOSS regimes. It is almost always an incorrect flow map: poorly located stock, misqualified marketplace role, unmonitored threshold, destination country rates not configured.

Our approach for e-commerce businesses is to build a flow map (country of dispatch, country of arrival, customer status, sales channel) before choosing the reporting regimes. This map then becomes the reference for configuring invoicing, ERP, and accounting software.

The developments to watch in 2026 are: (1) the first DAC7 / VAT cross-referencing checks by the DGFiP, (2) the ViDA extension in transport and accommodation, (3) the ramp-up of French mandatory e-invoicing and its future articulation with real-time VAT reporting.

For sellers using international marketplaces who wish to secure their monthly reconciliation, see our technical article: VAT OSS/IOSS reconciliation and international marketplaces 2026. For a review of accounting errors to avoid in e-commerce, read: E-commerce accounting errors to avoid in 2026.

For personalised e-commerce VAT support in Paris, book an appointment with our team: VAT and tax mission — Cabinet Hayot Expertise Paris.

• Cumulative B2C intra-Community sales since 1 January: is the €10,000 threshold approaching or crossed?
• Destination country VAT rates correctly configured in the online store?
• Marketplace sales correctly excluded from the OSS return (art. 256 V CGI)?
• Monthly IOSS return filed for direct-sale imports under €150?
• Export proofs retained for non-EU sales?
• Shipping costs taxed at the main goods rate, not the default rate?
• Consistency between marketplace receipts (DAC7 data) and VAT filings verified?
• DAS2 prepared for commissions paid to influencers/affiliates ≥ €1,200/year?

Sources: Légifrance — CGI art. 256 V, 262 I, 298 sexdecies F, 298 sexdecies G III, 1649 ter A; BOFiP BOI-TVA-CHAMP-20-20; European Commission, OSS VAT e-commerce portal; French Customs, IOSS regime. ViDA directive adopted by the EU Council in November 2024. DAC7: first platform declaration January 2024 for year 2023.