found a bug/error with FBA lost inbound reimbursements

ok when amazon reimburse for a lost inbound item as part of the UPS partner program

they would reimburse the seller so that the seller would receive the proceeds they would have had the item not been lost.

but now that VAT is charged by Amazon on commission and fba charges this amount is being deducted from the reimbursements but it is not recoverable elsewhere as no vat was charged as the sale/fba despatch did not occur.

does that make sense?

best for me to explain it this way.

product sells for £50.00 inc vat - nett is £41.67

vat on that is £8.33

amazon fees of £7.50 + 1.50 vat

fba fee £2.89 + 0.58 vat

if the item had sold the seller would have received from amazon £37.53 but then has to pay £8.33 vat

but can claim back £1.50 + £0.58 of vat on the vat return.

in this example the inbound item was lost by amazon.

amazon have repaid us £29.20

but we cannot recover the £1.50 + £0.58 as the fees (and accompanying vat) were never charged but the value of those fees was deducted as gross amounts from the reimbursement instead of being deducted as nett of vat from the reimbursement due.

I think this has affected all UK sellers with FBA lost inbound reimbursements since 01/08/2024