MOSS simplification for businesses trading below the VAT registration threshold

MOSS simplification for businesses trading

HMRC have released a Brief setting out simplifications for micro businesses supplying digital services to customers in other Member States.


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HMRC have released VAT Brief 4/16 on the 2015 VAT changes, focused on the well-documented issues facing micro businesses supplying digital services to EU consumers. It includes what it refers to as two simplifications: the first on determining the place of supply, the second on non-business supplies. 

The first simplification allows small businesses trading below the UK registration threshold to exercise their best judgment when determining the customer’s location and the place of supply of these services. The normal rule was two non-contradictory pieces of information, which was simplified for the smallest businesses to a single piece of information provided by their payment service provider. This has now been simplified further for these businesses to allow decisions to be based on any single piece of information such as the address given by the customer. 

The second is not so much a simplification, but a reminder for people to check if they are actually in business before registering for the VAT Mini One Stop Shop (MOSS). The Brief suggests that some MOSS returns submitted so far have been submitted by people who are not in business for VAT purposes. To access the Brief click here.


For further information contact :

Laura Gowland

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