EU VAT regulation

In certain situations Zalando becomes liable to pay VAT on sales made by partners through the Zalando marketplace to the local tax authority where the goods are sent to.

This means that in markets where Zalando is the deemed supplier, the Partner is no longer responsible for paying VAT to the local tax authority on their sales through the Zalando marketplace.

Zalando is a deemed supplier in the two cases only:

A) If the partner is not established in the EU (including Northern Ireland) and has no fixed establishment for VAT purposes in the EU (including Northern Ireland) and is fulfilling orders from an EU warehouse/stock location to EU customers

B) If the partner is shipping goods from outside the EU directly to an EU customer based on a certain value. Please bear in mind that this sales model is not supported by Zalando at the moment.

This does not impact partners who are established in the EU, or have a fixed establishment in the EU, and ship goods solely within the EU.

Shipping from a non-EU country directly to EU customers is not supported by Zalando at the moment. Should this be relevant to your operations, Zalando will reach out to you individually. If you have not been contacted, please reach out to your usual contact at Zalando.

This is based upon the country of legal establishment (incorporation) of the legal entity which has a contract with Zalando for the sale of products through one of the EU marketplaces.

For example, if you are incorporated in Germany, e.g. GmbH, then you are established in the EU. If you are incorporated in the USA then you are established outside the EU.

If you are a non-EU established partner (excluding Northern Ireland) you should check with your tax department or tax advisor whether you have a fixed establishment in the EU for VAT purposes, Zalando cannot determine this for you.

Please note that for the purpose of VAT establishment, Northern Ireland is still considered as an EU VAT territory.

You can find a full list of EU member states here.

Not necessarily, it is possible to have a VAT registration and no fixed establishment, or place of business, in a country. Please speak with your tax department or tax advisor for further information.

Zalando will be sending a request for written confirmation from each Partner of their place of establishment. 

For partners established outside of the EU, we request a copy of the certification of incorporation.

In this instance, the partner is obliged to share all relevant outbound warehouse locations in zDirect and, where there are multiple warehouse locations, to assign the actual location to each order item via API after fulfillment. For Zalando Fulfillment Solutions (ZFS) orders, Zalando does the assignment based on the actual fulfillment location.

Zalando will withhold the VAT due on sales in each EU country for deemed supplies and Zalando will pay the VAT to the local tax authorities.

Partners will receive details of this in their usual monthly/bi-monthly invoicing and payout process.

Zalando will pay the local VAT where it is a deemed supplier. Impacted partners should not pay any VAT to local tax authorities for sales made through the Zalando marketplace where Zalando is the deemed supplier.

In cases where Zalando is not a deemed supplier, it will remain the partner’s obligation to pay local VAT to the relevant tax authorities.

Please be aware that Zalando always needs up-to-date tax information about your business (at least three weeks before any incoming orders are processed). In case of doubt, Zalando will pay local VAT to the tax authorities and withhold the VAT amount from your bi-weekly/monthly payment. Subsequent updates will not be considered. 

For information and guidance on this, please speak with your tax department/tax advisor, Zalando cannot advise you on this.

In principle you should no longer raise a VAT invoice to the customer, since Zalando is the supplier for VAT purposes and is responsible for VAT invoices to the end customer.

Zalando will issue a monthly self-billing document for your deemed zero-rated B2B supply to Zalando based on your actual EU outbound warehouse location. Please check with your tax department/usual tax adviser if your business has to comply with further local tax reporting obligations in this regard.

In relation to the deemed supplier rules, no. However please see the section on One Stop Shop.

General information provided by the EU can be found here.

Please bear in mind that Zalando cannot provide you with tax advice on your own business activities. For this, you should speak with your tax department/tax advisor.

In essence, the OSS allows a Partner to report and pay VAT due on distance sales (i.e. sales delivered to a private person located in another EU member state) to other EU countries in one return which is submitted to the Partner’s local tax authority.

This can reduce the number of foreign VAT registrations that a Partner has within the EU.

For more details, please see the EU Commission website here.

No, it is optional. You can also continue to use local VAT registrations in each of the EU markets you sell in.

You should discuss the most suitable solution for your specific business with your tax department/tax advisor.

In this instance, you need to have local VAT registrations in the countries where you sell to. Please speak with your tax department/tax advisor about your options.

With the abolishment of the “distance selling threshold” system for VAT in the EU, it is now possible for partners to pay German VAT on their sales in the German marketplace through either a local German VAT registration or the One Stop Shop.

As of 1 July 2021, Zalando no longer insists on partners being locally VAT-registered and providing an F22 certificate in Germany. 

Irrespective of the above, a German VAT number is still required if the partner sells via Zalando Fulfillment Solutions (ZFS) from Germany.

More information about the OSS can be found here. You will need to discuss with your tax department/tax advisor whether the One Stop Shop is suitable for your business.

If you have any further questions about the implementation of the new VAT regulation within Zalando Partner Program, please reach out to Partner Care here.