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What is VAT/IOSS? How to Set Declaration with IOSS? | Explanation & Solution

Recently in CJ Facebook group, many drop shippers post questions about VAT and IOSS which took place since July 1st, So this article is going to explain these two concepts again and demonstrate how you can register for IOSS and set your IOSS declaration on CJ.

Recently in CJ Facebook group, many drop shippers post questions about VAT and IOSS which took place since July 1st, So this article is going to explain these two concepts again and demonstrate how you can register for IOSS and set your IOSS declaration on CJ.

We also post a video version of this article:

What is VAT?

To explain VAT (value-added tax), let’s use an example for easier understanding.

If the VAT rate is 10%, a farmer sells 1 bag of apples to a baker for 70 pennies, and the baker made a jar of apple jam and sells it to the customer for 5 pounds. During this process, the baker paid 77 pennies to the farmer, of which 7 is the VAT fee that got paid to the government by the farmer. When this apple jam got on the shelf, the customer needs to pay 5.5 pounds for it, as 50 pennies in which is the VAT fee, and the baker will pay 50-7, 43 pennies to the government.

This is VAT, a consumption tax placed on a product whenever value is added at each stage of the supply chain.

What is IOSS?

IOSS means the Import One-Stop Shop. It is the electronic portal businesses can use since July 1st, 2021, used to comply with e-commerce VAT obligations on distance sales of imported goods.

So, what is the IOSS for? The IOSS allows suppliers selling imported goods to buyers in the EU to collect, declare and pay the VAT to the tax authorities, instead of making the buyer pay the VAT at the moment the goods are imported into the EU as was previously the case.

So when it comes to selling to the EU, there are two occasions:

1. The order values > 150 euros

When the order value is above 150 euros, the recipient will be required to pay VAT and customs duties.

2. The order values <= 150 euros

When the order value is less than or equal to 150 euros, there are three options for CJ users to set the declaration:

(1) Set the declaration without IOSS

In this case, the recipient will be required to pay VAT in order to complete the customer clearance, otherwise, the parcel will be detained or destructed by the customs.

(2) Set the declaration with your own IOSS

If you have your own IOSS ID, you can link it to your CJ account

Click in Profile, then choose IOSS setting and IOSS.

We highly recommend you declare with your own IOSS which is valid and is linked to the destination country in the EU.

So, how to register for your own IOSS?

A business can be registered on the IOSS portal of any EU Member State, if your business is not based in the EU, normally you need to appoint an EU-established intermediary to fulfill their VAT obligations under IOSS.

(3) Set the declaration with CJ’s IOSS

If you are not from an EU country or simply don’t have your own IOSS, you can declare with CJ’s IOSS ID after editing the countries under IOSS Option > Declare with CJ’s IOSS.

CJ’s IOSS ID will not be applicable for orders valued above €150 and orders created manually/via Excel or CSV, and the recipient will be required to pay VAT.

*For regular orders, you will need to pay the VAT and IOSS handling fee (VAT*3%) if you declare with CJ’s IOSS ID when you submit orders on CJ. You can also view the order details below after payment.

If you have any other questions, feel free to post them to our Facebook group or register to CJ and ask for help from your personal agent!

Facebook Group Discussion

14 hours ago

Every time if they fail to deliver the product in time, they reply to the ticket with this message. So unreal. This looks like a message template for excuses.

---The product had arrived in our warehouse on 21, but it failed to pass the quality inspection. Therefore, we have asked for a new one in transit to our warehouse, which will take3 days. We will dispatch your products as soon as they are all stocked. Thanks for your understanding. Have a nice day! Best Regards---
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15 hours ago

𝟑 𝐑𝐞𝐚𝐬𝐨𝐧𝐬 𝐖𝐡𝐲 𝐘𝐨𝐮𝐫 𝐅𝐚𝐜𝐞𝐛𝐨𝐨𝐤 𝐀𝐝𝐬 𝐀𝐫𝐞 𝐍𝐨𝐭 𝐂𝐨𝐧𝐯𝐞𝐫𝐭𝐢𝐧𝐠⁣..

1 - 𝙉𝙤𝙩 𝙜𝙞𝙫𝙞𝙣𝙜 𝙚𝙣𝙤𝙪𝙜𝙝 𝙩𝙞𝙢𝙚⁣

When setting up a Facebook Ads campaign, you should know that your ads often need at least 3 days of running time to progress from the learning phase.⁣

In the learning phase, your ads will often perform poorly. That’s because Facebook’s algorithm is still “testing out the waters” and trying to target different smaller audience groups within your target audience to find out which responds the best to your ad.⁣

So, before thinking that your Facebook ads aren’t converting, leave them running for at least two or three days, and you will likely see an improvement in your campaign’s performance.⁣

Don’t forget that it works the other way around as well. If you leave your ads running for a long time (especially for smaller audiences), ad fatigue will occur, and your Facebook ads will stop converting.⁣

2 - 𝙁𝙖𝙞𝙡𝙞𝙣𝙜 𝙩𝙤 𝙖𝙣𝙖𝙡𝙮𝙯𝙚

Most businesses want to increase their Facebook Ads conversion rate, but with so many variables to consider, I understand that it may be challenging to do so.⁣

Luckily, you can analyze your Facebook ad campaigns to get a clearer picture of what can be improved. The more data that you have, the better your chances of optimizing your ads.⁣

To optimize the conversion of your Facebook ads, these are the most important metrics to look at:⁣

- 𝘾𝙋𝘾 (𝘾𝙤𝙨𝙩 𝙥𝙚𝙧 𝘾𝙡𝙞𝙘𝙠)⁣
- 𝘾𝙏𝙍 (𝘾𝙡𝙞𝙘𝙠-𝙏𝙝𝙧𝙤𝙪𝙜𝙝 𝙍𝙖𝙩𝙚)
- 𝘾𝙋𝙈 (𝘾𝙤𝙨𝙩 𝙥𝙚𝙧 1,000 𝙄𝙢𝙥𝙧𝙚𝙨𝙨𝙞𝙤𝙣𝙨)⁣
- 𝘾𝙤𝙨𝙩 𝙥𝙚𝙧 𝘾𝙤𝙣𝙩𝙚𝙣𝙩 𝙑𝙞𝙚𝙬⁣
- 𝙑𝙞𝙙𝙚𝙤 𝘼𝙫𝙚𝙧𝙖𝙜𝙚 𝙋𝙡𝙖𝙮 𝙏𝙞𝙢𝙚 (𝙞𝙛 𝙖𝙥𝙥𝙡𝙞𝙘𝙖𝙗𝙡𝙚)⁣

If you get to know which of these metrics underperform for your campaign, then it will be much easier to fix the problem that your Facebook ads are not converting!⁣

After advertising on Facebook for some time, you will get a feeling for when a particular metric is under or overperforming.⁣

3 - 𝙉𝙤𝙩 𝙩𝙚𝙨𝙩𝙞𝙣𝙜 𝙚𝙣𝙤𝙪𝙜𝙝⁣

There’s one thing that you should remember when advertising on Facebook:⁣

Test, test, and test!⁣

So, if your Facebook ads are not converting, test out some different images (or videos), ad copy, and headlines.⁣

You will never be able to predict which combination of these factors will convert the best, so the only option left is to test them all out.⁣

Don’t be afraid to test the ad more than once. The more you test, the more you’ll be able to understand what works and what doesn’t.⁣

When testing different ads, remember to try out different marketing angles as well.⁣

I hope this helps you out, if you have any questions leave them in the comment section below and I’d be more than happy to answer in as much detail as possible.

#shopifydropshipping #shopifydropship #facebookadsexpert #facebookadstips #facebookadsmanager #digitalmarketingagency #digitalagency #agencywebsite #business101 #business2022 #shopifymarketing #salestips #dropshippingtips #shopifyexpert #fbadstips #fbadsmastery #fbadsexpert #fbadsmarketing
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2 days ago

Hi,I ordered one item from China warehouse to United Kindom.I ordered a week ago but it still processing.I didn't understand.Why you say processing time is 3 days.I don't believe in I can receive it. ... See MoreSee Less

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2 days ago

#CJWarehouses #moment
another working day ☕️☕️☕️
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6 days ago

I am having issues with my CJ agent. She doesn't inform me on important changes on products that I have placed orders, eg out of stock etc. I have to find out by myself when its too late. I am seriously thinking of finding another supplier. Can anyone help? Thanks ... See MoreSee Less

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