EU Intra-Community Distance Selling Odoo 18
By Braincuber Team
Published on December 29, 2025
E-commerce business selling across EU creates VAT compliance chaos: German company shipping products to French consumers unsure whether charging German 19 percent VAT or French 20 percent VAT causing incorrect tax collection triggering 50K euro tax authority penalty, manual tracking of 10K euro sales threshold per country requiring Excel spreadsheets across 27 EU states consuming 40 hours monthly, no automated VAT number validation allowing sales to businesses without valid VAT numbers violating regulations, quarterly OSS One Stop Shop reporting requiring manual data compilation from invoices across multiple countries taking 3 days per quarter, and no fiscal position mapping causing wrong tax rates applied to 15 percent of transactions creating audit risks—generating compliance violations revenue loss and administrative burden from complex EU distance selling VAT management without automated country-specific tax handling.
Odoo 18 EU Intra-Community Distance Selling enables automated VAT compliance through automatic fiscal position configuration for all 27 EU member states, country-specific tax rate application based on customer location, automated VAT number validation ensuring business customer eligibility, OSS reporting for simplified quarterly filing supporting both Union OSS and Import OSS schemes, fiscal position automatic detection applying correct taxes without manual intervention, threshold monitoring per country preventing incorrect tax treatment, and multi-currency transaction support—reducing VAT compliance effort 80 percent through automation eliminating manual country tracking preventing tax authority penalties and ensuring accurate cross-border taxation through systematic EU-compliant distance selling management.
EU Distance Selling Features: 27 member state support, Fiscal positions, VAT automation, OSS reporting, Number validation, Threshold tracking, Multi-currency, Automatic tax mapping, Compliance assurance
Understanding EU Intra-Community Distance Selling
Sales and transportation of goods between EU member states to non-VAT registered customers:
Definition:
Movement of goods from one EU member state to customers consumers or non-VAT registered entities in another EU member state typically subject to taxation in destination country where delivery concludes.
Key Characteristics:
- Cross-border EU sales
- Customers not VAT registered
- Goods physically shipped between countries
- Subject to destination country VAT rules
- Governed by EU VAT directives
Transaction Types:
Shipped Items
Supplier arranges delivery using third-party carriers or own logistics with customer-paid transport costs
Online Sales
E-commerce transactions requiring VAT compliance for electronically ordered physical goods
Multiple Clients
Sales to consumers non-taxable organizations and specific entities like NATO international organizations
Enabling EU Distance Selling
Configuration Steps:
- Go to Accounting → Configuration → Settings
- Scroll to Taxes section
- Enable EU Intra-community Distance Selling checkbox
- Click Save
Automatic Tax Configuration:
Enabling feature automatically generates:
- Fiscal positions for all 27 EU member states
- Country-specific VAT rates
- Tax mapping rules
- OSS reporting structure
Important: Automatic generation based on company country setting. Ensure company country correctly configured before enabling to generate appropriate fiscal positions.
Fiscal Positions Configuration
Manage country-specific tax rules:
Accessing Fiscal Positions:
- Go to Accounting → Configuration → Fiscal Positions
- View list of all EU member state positions
- Click position to view/edit details
Creating Custom Fiscal Position:
Example: Configuring Ireland VAT
- Click Create button
- Set Fiscal Position name: Ireland - Distance Selling
- Set Company: Your Company
- Enable Detect Automatically checkbox
- Automatically applies position when customer country matches
- Enable VAT Required if needed
- Partner must have valid VAT number
- Set Foreign Tax ID for your company
- Your VAT registration in destination country
- Configure tax mapping in Tax Mapping tab
- Click Save
Tax Mapping Configuration:
Map origin taxes to destination taxes:
Example Mapping:
- Tax on Product: 19 percent Germany VAT → Maps to → 20 percent France VAT
- Tax on Service: 19 percent Germany VAT → Maps to → 20 percent France VAT
When selling to French customer, German VAT automatically replaced with French VAT rate
Automatic Detection
Fiscal position applies automatically based on customer data:
Detection Criteria:
- Customer Country: Partner delivery address country
- VAT Number: Presence or absence of valid VAT
- Company Settings: Origin country configuration
Workflow Example:
- German company creates sales order
- Customer: French consumer (no VAT number)
- Delivery address: France
- Odoo detects: France fiscal position needed
- Automatically applies France Distance Selling position
- Product tax changes from 19 percent Germany to 20 percent France
- Invoice generated with correct French VAT
OSS Reporting One Stop Shop
Simplified VAT reporting for cross-border B2C transactions:
OSS Overview:
Purpose: Single portal for managing VAT responsibilities across all EU member states avoiding individual country registrations.
Schemes:
- Union OSS: Cross-border services and goods sales
- Import OSS: Imported goods valued at 150 euros or less
Generating OSS Reports:
- Go to Accounting → Reporting → Tax Report
- Click Report: Generic Tax Report dropdown
- Select report type:
- OSS Sales: For Union OSS scheme
- OSS Imports: For Import OSS scheme
- Choose export format:
- PDF for viewing
- XLSX for analysis
- XML for electronic filing
- Report generates with country breakdown
- Submit to OSS portal via federal authority platform
OSS Report Contents:
- Sales per EU member state
- VAT amounts per country
- Applicable VAT rates
- Total VAT due
- Reporting period
Threshold Management
Monitor country-specific distance selling thresholds:
EU Threshold: 10,000 euros annual sales across all EU states
Below threshold: Apply origin country VAT. Above threshold: Apply destination country VAT for each sale.
Complete Transaction Example
Scenario: German Company Selling to French Consumer
- Customer Setup:
- Name: Jean Dupont
- Country: France
- VAT Number: None (consumer)
- Sales Order Created:
- Product: Laptop - 1000 euros
- Default tax: 19 percent Germany VAT
- Automatic Detection:
- System detects France delivery
- Applies France Distance Selling fiscal position
- Tax changes to 20 percent France VAT
- Invoice:
- Subtotal: 1000 euros
- VAT 20 percent France: 200 euros
- Total: 1200 euros
- Quarterly OSS Report:
- France sales: 1000 euros
- France VAT: 200 euros
- Submitted via OSS portal
Best Practices
Enable Feature Before First Cross-Border Sale: Enabling mid-operation equals retroactive tax corrections. Past invoices have wrong VAT rates requiring credit notes and reissue consuming 20 hours monthly. Enable before launch ensuring all transactions correct from start preventing compliance issues.
Validate VAT Numbers for Business Customers: Selling to business without VAT validation equals incorrect tax treatment. B2B intra-community sale requires reverse charge no VAT charged but without validation proof tax authority rejects treatment charging penalties. Always validate VAT numbers through VIES system before invoice.
Monitor OSS Thresholds Quarterly Not Annually: Annual threshold check equals potential 9-month non-compliance. Quarterly review catches threshold crossing in Q2 enabling immediate OSS registration versus discovering year-end facing retroactive reporting nightmare. Proactive monitoring prevents penalties through timely compliance.
Conclusion
Odoo 18 EU Intra-Community Distance Selling enables automated VAT compliance through automatic fiscal position configuration for 27 EU member states country-specific tax application VAT number validation OSS reporting and automatic tax mapping. Reduce compliance effort 80 percent through automation eliminating manual country tracking preventing tax authority penalties ensuring accurate cross-border taxation through systematic EU-compliant distance selling management supporting business expansion across European single market.