Composite photocatalysts with hetero-structures usually favor the effective separation of photo-generated carriers. In this study, BiOIO3 was chosen to form a hetero-structure with BiOI, due to its internal polar field and good lattice matching with BiOI. The interfacial properties and band offsets were focused on and analyzed in detail by DFT calculations. The results show that the charge depletion and accumulation mainly occur in the region near the interface. This effect leads to an interfacial electric field and thus, the photo-generated electron-hole pairs can be easily separated and transferred along opposite directions at the interface, which is significant for the enhancement of the photocatalytic activity. Moreover, according to the analysis of band offsets, the vertical BiOI/BiOIO3 belongs to the type-II hetero-structure, while the in-plane BiOI/BiOIO3 belongs to the type-I hetero-structure. The former type of hetero-structure has more favorable effects to enhance the photocatalytic activity of BiOI than that of the latter type of hetero-structure. In the case of the vertical BiOI/BiOIO3 hetero-structure, photo-generated electrons can move from the conduction band of BiOI to that of BiOIO3, while holes can move from the valence band of BiOIO3 to that of BiOI under solar radiation. In addition, the introduced internal electric field functions as a selector that can promote the separation of photo-generated carriers, resulting in the higher photocatalytic quantum efficiency. These findings illustrate the underlying mechanism for the reported experiments, and can be used as a basis for the design of novel highly efficient composite photocatalysts with hetero-structures.