About to reach VAT threshhold, what happens?
Next month I’ll hit the VAT threshold. I have already registered for VAT but it hasn’t gone through yet.
- what happens when I hit the threshold? Does Amazon add VAT on top of my listing prices?
- Do Amazon pay the VAT for me?
- I applied for the flat rate, does that work with Amazon?
Any advice welcomed, I am baffled by the whole thing.
Thanks.
0 replies
Seller_7VbclcPFFRTnc
No amazon won’t add on the VAT on top of your listings so you need to amend pricing where necessary
No amazon don’t pay vat on UK to UK sales for you
You complete a vat return and pay whats due
Amazon unfortunately don’t work alongside the flat rate
You need to make sure your listings have the correct product tax codes applied to them too
Do you have an accountant ?
Amazon will no longer charge you vat on their fees
Note, I am presuming you are UK based as its threshold and flat rate
Seller_DROodOAYHftnc
You really need to do your homework on this, and if you are baffled by the basics, then you need to know what is involved.
Even a basic google search will tell you what is required and what you need to do, and your responsibilities - I believe quarterly returns etc.
As said - the VAT penalties for getting it wrong could break you.
Seller_esvgLzKXw2YAl
There really are good reasons why you should get an accountant.
As a general rule of thumb, they will actually save you more than they cost.
But if you have applied for the flat rate scheme, have you actually sat down and worked out whether it will save you money or not?
It’s not a simple calculation, though the flat rate is a lot easier to use, it’s not necessarily better.
There is also a limit on how high your turnover can go, before you have to change to standard VAT.
Remember, that you cannot claim the VAT from any of your expenses on the flat rate.
You will need to recalculate all of your prices, to account for the vat. Initially, it will probably cost you money.
Seller_lyUF34znaGncK
Isn’t it just a case of paying 6.5% of my turnover? I thought that was the point of flat rate i.e. that it’s uncomplicated. I have nothing against getting an accountant but if he’s simply going to figure out what 6.5% is and then send me a bill I’d rather not.
Seller_NoMNQDGnEW5Bx
I don’t pay much for my accountant because I do most of it and she checks through everything and submits it, its worth it for the peace of mind alone plus the guidance on the things I don’t know as much about like reverse charges etc
Seller_Hg3zznbQySqDE
Just a word of warning from VAT “user”. Please research everything you can about VAT. If you make a mistake on your VAT return which is reasonably serious then ignorance is no excuse. That is one of the reasons you need an accountant!
Seller_ptkn1sk9s9JEE
Why on earth would you be resistant to employing an accountant when your turnover has reached the VAT threshold? There are an enormous number of advantages to having an accountant, and peace of mind is just one of them.
I had the same accountant for 26 years. We watched each others children grow up and go to University. I had complete trust in his advice, and followed his recommendations to the letter. You can’t buy that kind of relationship.
The penalties for making a mistake with VAT are considerable.
Get an accountant.
Seller_3di7P6gi1JyqG
I’m studying to be an accountant…so maybe hire one for now then study it so you can save money by doing it in-house
Seller_6sxtIS0RbZ5k7
I’ve just worked out that the VAT on my Amazon fees alone (FBA) is 6.7% of the sale price so, depending on what percentage of your sale price you are paying your manufacturer/wholesaler, you may well make more savings by doing standard VAT.
I do understand the desire to keep it simple with the flat rate though, I am considering putting on my Big Girl Pants and registering for VAT and I think that is the road I would go down.
Seller_6sxtIS0RbZ5k7
Remember also that the accountant’s fees are tax and VAT deductible 
