logo

Dropshipping

After the outbreak of the Covid-19 pandemic and the quarantine, the demand for the creation of e-shops increased tenfold, while according to the Associationof Greek Industrialists, the turnover of sales in Greek online stores during the lockdown period, on average, increased sixfold.

Retail in the new digital era is enclosed in three aspects: interconnected customers, a smart store and an interconnected supply chain.

A new form of digital store business model is also drop shipping. A new management system that changes the data of an e-shop store, as it simplifies its operation process.

In particular, the online store, instead of maintaining inventory and storage space, is essentially an "electronic storefront" by directly buying the products it needs to fulfill its orders, from a supplier at a wholesale price.

In this situation, the obligations of the intermediary-online store concern, mainly, the management of customer relationships, the retention and acquisition of new customers and the processing of orders.

Itis clear that the wholesaler, the e-shop, and the final customer can be in different countries, within or outside the European Union.

The comparative advantages include the non-requirement of start-up capital or subscription as ready-made platforms such as eBay or Aliexpress can provide ready-made platforms of such online stores, which do not require very specialized IT knowledge.  they are limited to an internet connection and a computer.

Accounting and tax treatment.

The reseller (e-shop) is responsible for issuing a tax document (invoice or retail receipt) to the consumer. For his own assurance, he must keep a complete record of a) the details of the electronic order he accepted, b) the order he gave himself to the wholesaler with the order to be sent directly to consumers and c) all documents related to the shipment of the product and the billing documents.

The transaction is taxed in the State of importation of the goods, to which the duties and the import VAT are due, in accordance with the legal framework of the respective country. The treatment is similar when the good is sent to the final consumer in Greece, where any charges provided for in the Customs Code are applied.

If there is no business or company (Individual, P.C., E.E., OE, etc.), one should be created. The procedure is as follows: The customer pays for the e-shop.  The e-shop pays the supplier on behalf of the final customer by sending his details, while keeping the percentage of his profit.

The documents that will be issued Retail Receipts or Invoices either in countries of the community or in third countries should not have a VAT charge.

The sale of goods within the country by sending the goods directly from a third country to the recipients, has the characteristics of the assignment of the import right. After the abolition of para. 4 of Article 13 of the VAT with para. 3 of article 20 of Law 4141/2013 (Government Gazette A ́ 81 / 05-04-2013), the supplies of goods made before their importation are not subject to VAT and therefore the invoice issued by the assignor does not include VAT. The corresponding VAT shall be collected in accordance with the provisions in force under customs and tax legislation when the goods are placed under the procedure for release for free circulation. The formation of the taxable value is carried out in accordance with the provisions of article 20 of the VAT Code, in conjunction with the relevant Community provisions on the formation of a customs value (POL.1087/2013).

The dispatch of items to private individuals, imported by the company and then sent to private customers, does not fall under Directive 2006/79/EC which regulates the tax exemption for the import of goods in the formof small parcels of a non-commercial character from third countries.

The retail data (A.L.P.) issued are subject to VAT as when they are sent to customers, according to para. 1 of Article 13 of VAT, the delivery shall be deemed to take place within the territory of the country.

Regarding the import of small parcels (dispatch of goods from a third country directly to private individuals), the real value of which does not exceed EUR 22 per consignment, they are exempt from VAT. 24 Reg. 1186/09 and articles 20-21 of Law 1684/87) and items whose total value does not exceed 150 euros are exempt from duty.

For the issuance of the retail receipt, in case the business is Greek, it issues the tax information (invoice or retail item) without VAT, which states that it is a taxable transaction outside Greece (article 13 VAT). In our opinion, it should have all the evidence of transaction documentation that proves that the transaction is outside the scope of VAT in Greece. Such data are, a) the electronic orders it receives from buyers / consumers (printing with the buyer's details, items, quantities and value), b) the orders given by the company to the manufacturer or wholesaler established in a Third Country with the order to be sent directly to consumers and c) any other documents sent by the manufacturer or wholesaler along with the invoice to the Greek company that associate the shipments of the goods with the orders accepted by the Greek company from the buyers / consumers.

Copyright © 2020 Bluemind.gr

| Designed by
Bluemind.gr