Last updated: October 2026
If you sell from Great Britain to consumers in the EU, there are three main routes. You can ship each order using the Import One-Stop Shop (IOSS), which covers eligible consignments with an intrinsic value of €150 or less. You can ship with full customs clearance, which is required above €150. Or you can import stock in bulk and fulfil orders from an EU warehouse, which tends to make more sense once EU volume is steady. Two 2026 changes have shifted the comparison: a temporary €3 customs duty on low-value consignments since 1 July, and a €2 EU handling fee from 1 November.
This guide explains each route, the rules that apply as of October 2026, the mistakes we see most often and a simple way to decide. It covers goods sent from Great Britain (England, Scotland and Wales). Northern Ireland has separate arrangements for goods and isn’t covered here.
The three ways to ship from the UK to the EU
Every order sent from Great Britain to an EU consumer is an import into the EU, so it needs a customs declaration and EU VAT treatment. What changes between the three routes is where that import happens: once per parcel, or once per bulk shipment of stock.
Ship from Great Britain using IOSS
IOSS is an EU VAT scheme. It lets you charge the customer’s local VAT at checkout and report it in one monthly return, so the customer isn’t asked for VAT on delivery. It covers goods sent from outside the EU to consumers where the consignment’s intrinsic value (broadly, the value of the goods themselves, excluding transport and insurance shown separately) is €150 or less. Excise goods such as alcohol and tobacco can’t use it.
A business established in Great Britain must appoint an IOSS intermediary to use the scheme. The intermediary registers the business and handles its IOSS returns and payments. Since 1 July 2026, these consignments also carry the temporary €3 customs duty, and from 1 November the €2 handling fee applies too, so build both into your EU prices or delivery charges.
Ship from Great Britain with full customs clearance
Above €150, IOSS can’t be used. Each consignment is declared in full at import, with import VAT and any customs duty due at the destination country’s rates. The €2 handling fee also applies to these distance sales from 1 November 2026.
Who pays depends on the delivery terms. Under DAP (Delivered at Place), the customer handles import clearance and pays the charges at the door. Under DDP (Delivered Duty Paid), the seller takes on those obligations and costs. DDP needs a workable set-up. An EU EORI number (a customs ID) is normally required, but it is only an identification number. A seller not established in the EU will generally need an EU-based indirect customs representative to lodge the import declaration, often arranged through the carrier. Carrier DDP services vary, so check exactly what the contract covers.
IOSS and DDP are not the same thing. IOSS is a VAT reporting scheme. DDP is a delivery term that decides who handles import obligations and costs. A carrier’s duties-paid service can run alongside IOSS, but they are separate arrangements.
Hold stock in an EU warehouse
With this route, you import stock in bulk and fulfil orders from inside the EU. Duty is assessed on the bulk inbound customs declaration, rather than through separate import declarations for each customer order. Delivery is faster and returns stay inside the EU.
The trade-off is VAT admin. Holding stock normally requires VAT registration in the country where it sits. Sales to customers in that country go on the local VAT return. Sales shipped from there to consumers in other EU countries can usually be reported through the Union One-Stop Shop (OSS) at each customer’s local VAT rate. Fiscal-representation rules vary by country. We compare this route in more depth in our guide to EU fulfilment versus cross-border shipping.
Common UK-to-EU shipping mistakes
- Assuming UK goods are always duty-free. The UK–EU Trade and Cooperation Agreement only gives zero tariffs to goods that meet its rules of origin, backed by evidence. Products made in China or the US and stored or resold in Great Britain won’t normally qualify. And under the 2026 low-value rules, even genuinely UK-origin goods sent under IOSS still pay the €3 duty.
- Leaving customers to pay at the door. Shipping DAP means your EU customer can be asked for VAT, duty and a carrier fee before they get their parcel. Many refuse delivery, and the parcel comes back at your cost. If you sell to consumers, a set-up that prevents charges at delivery is usually worth the effort.
- Forgetting that returns cross the border too. A return from the EU to Great Britain is a UK import. Returned Goods Relief can stop duty and import VAT being charged again, but only when its conditions are met: the goods come back within the time limit (generally three years), in an unaltered state, with evidence of the original export, and the relief is claimed correctly on re-import.
UK-to-EU VAT and customs rules in 2026
This guide was checked against current EU and UK customs and VAT guidance available on 12 October 2026. It is an overview, not legal or tax advice. Rules and carrier processes can change, so confirm the treatment of your products and supply chain with a qualified customs or VAT adviser.
Consignments with an intrinsic value of €150 or less
- VAT. Use IOSS through an intermediary to collect VAT at checkout. Without IOSS, import VAT is due at the border.
- €3 customs duty. Since 1 July 2026, a temporary €3 duty applies per category of goods in the consignment, based on tariff classification, not per parcel or per unit. Five identical T-shirts would normally count once; a T-shirt and a watch would count twice. It is due to apply until the EU’s new customs data hub is running, currently planned for July 2028.
- UK origin. Qualifying UK origin doesn’t remove the €3 duty on low-value IOSS consignments. Preference may still be claimed through a full customs declaration if the origin rules, evidence and procedure are all satisfied, so check whether your carrier can support that.
- €2 handling fee. From 1 November 2026, a non-refundable €2 Union handling fee applies per item, meaning goods in the consignment that share the same tariff classification and origin. It is separate from duty and VAT and isn’t refunded on returns.
Consignments above €150
- VAT. Import VAT at the destination country’s rate is due at import. IOSS can’t be used.
- Duty. Normal EU tariffs apply unless the goods meet the UK–EU rules of origin and you hold the evidence, usually a statement on origin.
- €2 handling fee. It also applies to these distance sales from 1 November 2026. The fee has no value threshold.
- Who pays. Under DAP, the customer. Under DDP, the seller, which normally means an EU EORI number plus an EU-based indirect customs representative.
Stock held in an EU warehouse
- Import. Duty is assessed on each bulk inbound declaration, based on customs value, classification and origin. Import VAT is normally recoverable through your local VAT registration if you hold the right evidence.
- Handling fee. The €2 fee targets distance sales to consumers, so it shouldn’t apply to a bulk stock import into your own warehouse. Confirm with your broker.
- VAT on sales. Local sales go on the local VAT return. Eligible sales to consumers in other EU countries are usually reported through Union OSS. The €10,000 threshold that lets EU-based businesses charge home VAT on small cross-border sales isn’t available to sellers established outside the EU.
- Fiscal representation. Requirements differ between EU countries and depend on your circumstances. Check before choosing where to hold stock.
Product safety applies to every route
Under the EU’s General Product Safety Regulation (GPSR), many consumer products placed on the EU market must have an EU-established responsible economic operator. Depending on the product and supply chain, this may be an EU manufacturer, importer, authorised representative or, in limited cases, a fulfilment service provider. Their details may need to appear on the product, packaging or accompanying documents and in online listings. Food, medicines, cosmetics, medical devices and other regulated categories follow separate or additional rules.
The short version: low-value consignments from Great Britain now carry duty and, from November, a handling fee as well as VAT, so the gap between shipping from Great Britain and holding stock in the EU is narrower than it used to be.
IOSS vs full customs vs EU fulfilment
| Route | GB + IOSS | GB + full customs | EU warehouse |
|---|---|---|---|
| When it applies | Eligible B2C consignments, intrinsic value €150 or less | Required above €150; possible below it | Stock imported in bulk, orders fulfilled locally |
| Best for | Early or occasional EU demand | Higher-value orders | Steady volume across several EU markets |
| VAT | Collected at checkout; monthly IOSS return via your intermediary | Import VAT handled at import | Local VAT registration; cross-border B2C sales usually via OSS |
| Duty | Temporary €3 per category of goods; applies even to UK-origin goods | Normal tariffs unless valid UK preference is claimed | Assessed on each bulk inbound declaration |
| €2 handling fee (from 1 Nov 2026) | Yes, per item | Yes, per item | Not on bulk stock imports |
| Delivery terms | Carrier service needed to avoid charges at delivery | DAP or DDP must be agreed clearly | Domestic EU delivery |
| Delivery speed | Slower; each parcel crosses the EU border | Slower; full clearance per parcel | Domestic EU delivery times |
| Returns | Cross the border back to Great Britain | Cross the border back to Great Britain | Handled inside the EU |
| Main cost drivers | Postage, duty and fee per parcel, intermediary | Clearance, brokerage and fee per parcel | Storage, inbound freight, fulfilment, VAT compliance |
Simplified for comparison. Real costs vary with product classification, origin, customs value, basket mix, destination, carrier, customs-representation model, VAT-recovery position and returns rate.
Not sure which route fits your EU orders?
Example: when an EU warehouse starts to make sense
Here’s how one hypothetical Great Britain homeware brand might move through these routes as its EU sales grow. It isn’t a real customer, just a common pattern.
EU orders are a handful a week, mostly under €150. The brand appoints an IOSS intermediary, collects destination-country VAT at checkout and uses a carrier service that prepays import charges, so customers don’t get an unexpected bill at the door.
EU orders become steady. Mixed baskets mean more items per consignment, so the €3 duty and the €2 handling fee add up per order. Returns back to Great Britain are slow, and customers want faster delivery. The brand models bulk import against these per-parcel costs.
It moves its bestsellers into an EU warehouse, registers for VAT there, reports local sales on the local return and uses OSS for sales to other EU countries. Slower lines stay in Great Britain and ship under IOSS. Whether this saves money depends on its own numbers, which is why it modelled first.
Should you use IOSS or an EU warehouse?
Answer these honestly for your EU sales over the last few months:
- Do you get EU orders every week, not just occasionally?
- Do most EU baskets contain several different products?
- Are your products made outside the UK, so they probably don’t qualify for zero tariffs?
- Do your EU customers expect delivery within two or three days?
- Are EU returns frequent enough to be a real cost?
Mostly no: Ship from Great Britain with IOSS and a carrier service that prevents charges at delivery. Keep it simple until EU demand proves itself.
Mostly yes: Model holding your core range in an EU warehouse. Faster delivery, fewer border costs per order and local returns often justify the set-up, but run your own numbers first.
A mix: Consider splitting it. Bestsellers in the EU, the long tail shipped from Great Britain.
Where Trackveo fits
Trackveo is asset-light: we don’t own warehouses. We coordinate a network of warehouse and carrier partners across European markets, so a Great Britain brand can place stock where its customers are without committing to one fixed site. We’ll help you compare shipping from Great Britain against holding stock in the EU for your own products and volumes.
Trackveo can coordinate VAT registration and fiscal-representation support through appropriately qualified providers. See our VAT and fiscal-representation support.
If your EU orders are still occasional, we’ll tell you that shipping from Great Britain is probably fine for now.
Frequently asked questions
Can a Great Britain business use IOSS?
Yes, but it must appoint an IOSS intermediary to register and handle its returns and payments. IOSS covers eligible B2C consignments sent from outside the EU with an intrinsic value of €150 or less, excluding excise goods such as alcohol and tobacco. Businesses established in Northern Ireland follow different rules.
What is the €150 IOSS limit based on?
It is based on the consignment’s intrinsic value, broadly the value of the goods themselves. Transport and insurance costs are generally excluded when shown separately on the invoice.
Does UK origin remove the €3 customs duty?
Not for low-value consignments sent under IOSS. Under the temporary 2026 rules, the €3 duty applies even when goods would otherwise qualify for preferential UK origin. Preference may still be claimed through a full customs declaration if the rules of origin, evidence and procedure are satisfied, but your carrier must support that type of declaration.
Does the €2 handling fee apply above €150?
Yes. From 1 November 2026, the €2 Union handling fee applies to qualifying distance-sale imports regardless of consignment value. It is charged per item, meaning goods in the consignment sharing the same tariff classification and origin. It is separate from customs duty and VAT, and it isn’t refunded on returns.
Do UK goods enter the EU duty-free?
Only if they meet the UK–EU rules of origin and you hold evidence. Goods made elsewhere and stored or resold in Great Britain won’t normally qualify. Consignments above €150 then pay normal EU tariffs, and low-value consignments pay the temporary €3 duty either way unless preference is claimed through a full declaration.
Do I need an EU VAT number?
Not always. If you ship from Great Britain and use IOSS, your IOSS registration through an intermediary covers VAT on those consignments. If you hold stock in an EU country, you’ll normally need a VAT registration there. Shipping DDP above €150 can also raise import-VAT registration questions, so check this with your adviser for each destination.
What is the difference between IOSS and OSS?
IOSS covers VAT on low-value goods imported into the EU from outside it. OSS, the Union One-Stop Shop, covers VAT on sales of goods already inside the EU that are shipped to consumers in another EU country. A Great Britain brand shipping from home may use IOSS; one holding stock in the EU would typically use OSS.
What is the difference between DDP and DAP?
Under DDP (Delivered Duty Paid), the seller handles import clearance and pays import charges, so the customer pays nothing at delivery. Under DAP (Delivered at Place), the customer handles them and may be asked to pay before receiving the parcel. DDP is better for customers but needs an EORI number, customs representation and a clear carrier contract.
Do I need an EU Responsible Person for my products?
Often, yes. Under the GPSR, many consumer products sold in the EU need an EU-established responsible economic operator. This may be an EU manufacturer, importer, authorised representative or, in limited cases, a fulfilment service provider. It applies whichever shipping route you use, and some categories such as cosmetics follow their own rules.
Is it cheaper to ship from Great Britain or hold stock in the EU?
It depends on your numbers. Low or irregular EU volume usually favours shipping from Great Britain. Steady volume, mixed baskets and frequent returns often favour EU stock. The €3 duty and €2 handling fee have moved that tipping point earlier for many brands, but an EU warehouse is never automatically cheaper, so model it first.
How are customer returns handled?
Returns sent from the EU back to Great Britain are UK imports. Returned Goods Relief can stop duty and import VAT being charged again if the goods come back within the time limit, in an unaltered state, with evidence of the original export and a correct claim on re-import. The €2 handling fee isn’t refunded on returns. Holding stock in the EU keeps returns local.
Tell us your markets, volumes and products, and we’ll give you an honest answer, even if that answer is that you don’t need us yet.
Sources: Council of the EU, European Commission (EU customs reform, OSS/IOSS and EORI guidance), GOV.UK (IOSS, rules of origin, Returned Goods Relief) and the EU General Product Safety Regulation, checked on 12 October 2026. This article is general information, not legal or tax advice.