VAT changes on sales to UK customers


#1

Starting January 1, 2021, the way that UK VAT is collected on sales to customers in the UK will change under new legislation being introduced by the UK Government.

Amazon will be responsible for collecting UK VAT on the following sales of goods delivered to customers in the UK where ordered through any Amazon storefront:


  1. Goods delivered from inventory stored outside the UK with a parcel value of up to £135; and
  2. Goods delivered from inventory stored in the UK, irrespective of value, where you, the seller, are not established in the UK.

Where either of these supplies take place, Amazon will calculate and collect UK VAT from the customer at checkout and remit this directly to the UK Tax Authorities. You will not receive the UK VAT amount in your disbursements and will not be required to remit these amounts to the UK Tax Authorities.

Please note that the current VAT exemption for sales of goods under £15, where goods are delivered to UK customers from inventory stored outside of the UK, will also be removed from January 1, 2021. At that point, UK VAT will be calculated and collected by Amazon on these sales irrespective of their value.

Further information regarding this change and the implications for your business, is available on the UK VAT Ecommerce Legislation help page.


#2

Hello, can anyone answer my question please? Does this mean that sellers no longer need VAT/EORI numbers when registering as a seller in the UK? Or do we still need to register VAT/EORI (due to import duties), regardless of the fact that amazon will from now on collect and remit VAT on behalf of us for our customers?


#3

Can you clarify what should be enclosed with the parcel when we send the goods?
How will customs know VAT was already paid?

Also, if I am selling on Amazon UK, VAT is already included in price. If Customers buy fromo non-UK marketplace, say, from Amazon US with delivery to UK, I assume VAT will be added on top of price by Amazon. Can you confirm?

Thanks,
Rudolf


#4

We pay vat importing goods into the UK how do we get this substracted from the VAT amazon automatically pays to the UK tax services.


#5

It is cool Amazon will start collecting VAT because it is less headache for people who want to expand and test the market out in the UK.


#6

You need to add Amazon’s ARN number to orders shipped to Australia; I assume something similar will be required when shipping to the UK. We add the ARN to the shipping label.


#7

Thanks,

I thought this should be the case, but there is no information on it at Amazon. They can certainly make it clear.

Rudolf


#8

If Customers buy fromo non-UK marketplace, say, from Amazon US with delivery to UK, I assume VAT will be added on top of price by Amazon. Can you confirm?

That question is answered on the Amazon help page that the news article linked to.

The VAT is added on top of the tax-exclusive price.
So in the case of .com and .ca that will indeed be the listing price directly. On other non-UK marketplaces the domestic tax is first deducted from the listing price.


#9

Hello,Is there anyone can answer this question?
how to calculate the product price of £14.99 and £16.99 pounds VAT?


#10

According to this morning’s exchange rate, 1 British pound currently = $1.34 USD. So multiply that out and £14.99 x 1.34=$20.09 USD. £16.99x1.34 = $22.77 USD. If you are asking how much VAT is added, I have heard it’s 20%, but you would have to consult with a tax advisor.


#11

So 2 important questions:

I am a USA ONLY seller, with only a business presence here in the USA. I only allow goods to be shipped overseas to EU, etc through FBA. All of my FBM orders are only shipped to USA customers. FBA is the only method I currently use to allow orders from overseas customers. All of my inventory is only stored in the USA. Do I have to register for a VAT # because FBA ships my items overseas? I was under the impression that Amazon basically “purchases” FBA goods from us, at point of sale to the customer, and collects all import/export taxes from customer, and takes care of all import/export taxes. I assumed we are not responsible for any overseas tax collection for FBA sales if we are only registered in the USA, and only store goods in the USA. Please correct me if I am wrong?

Question #2: It sounds like Amazon is collecting the VAT from customers, adding it to price for anything purchased on Amazon or Amazon.ca, unless it’s over £135, which amounts to $180.90 USD. That’s great for 99.9% of my products. But what about when we get the rare $300 item? Can we exempt it from being listed or sold through FBA to a UK customer? I certainly don’t want 20% VAT tax deducted from my proceeds, considering thats about double our profit, netting us an instant loss on all sales over $180.90. Why doesn’t Amazon just collect the VAT on everything? They may not be required to on orders over $180.90, but I certainly don’t want to pay that bill and lose my profit. And it’s not worth it to me to register for a VAT # just for those rare items over $180.90 USD.

Also, does the £135 limit apply per item, or on order totals? IF a customer orders 5 £40 items totaling over £135, would Amazon not collect the vat from customer in that circumstance? And we would be responsible?


#12

Two very important questions were asked in this thread:

  1. Does this mean that sellers no longer need VAT/EORI numbers when registering as a seller in the UK?
  2. We pay vat importing goods into the UK and for Amazon’s services (fulfillment, storage) how do we get this substracted now that we don’t collect the vat

#13

I quit selling stuff to the uk. A $10 item that costs $15 to ship will cost the buyer about $50 after paying the vat and customs fees. Really doesn’t make the buyer happy, and if they get returned due to the buyer refusing it due to high costs, ends up being costly to the seller


#14

Amazon, Please answer these two questions re-emphasized by “VRY_GUD_AMZON_SLR_XD”.

These two questions are by far the most important questions regarding this update. Especially number 2. We pay VAT when importing goods into the UK and for Amazon’s services. But if Amazon will now collect and remit VAT on sellers’ behalf, then what happens (or what are we supposed to do) on our monthly VAT filing & returns? Do we just request for a VAT refund for the VAT charged to us for imported goods?

So basically if we pay 100 GBP in VAT for imported goods, then do we just request HMRC for a 100 GBP VAT refund in the next quarter’s VAT return? Since Amazon will be collecting and remitting VAT for our customers for all orders? (because this will mean we as sellers will be owing 0 in VAT to HRMC for our B2C transactions, whereas we will still be paying import VAT. So of course we should receive a refund for the import VAT).

Sorry for repeating the same thing over again, but this concept is quite hard to put in words.


#16

Did you ever get an answer for this?


#17

It seems as I am a US Seller with listings in the UK, I can choose the Exempt VAT option in my Seller’s Dashboard because of Item #3 below (at bottom):

Terms and Conditions

Features

  1. Based on your self-declaration, confirming that you are not required to register for VAT in both the EU and the UK and generate VAT invoices for your Customers, Amazon will generate and issue a receipt (“proof of purchase”) for all your sales in your name and in your behalf.

  2. No VAT will be calculated from the offer listing price. Customers will be able to base their buying decisions on the offer listing price and the “Downloadable receipt” badge on your offer.

Terms and Conditions

By declaring your VAT registration status as “exempt”, you agree to the following terms and conditions:

3. As a Business established outside the EU and the UK:

** 1. You exclusively ship goods directly from outside the EU or the UK.*

** 2. You do not have any inventory stored in any of the EU 27 member states and the UK.*

** 3. You do not act as the importer of the goods in the EU and the UK.*