VAT and selling to EU
We recently set up shipping to Ireland. Products that are not VATtable in the UK have had Irish VAT removed by Amazon. Does this means we have lost the VAT amount on the products or do we claim the VAT back somewhere? If we lose the value of the Irish VAT, it’s really not worth selling to Ireland.
0 replies
Seller_JVTfjuLs0moo6
You need to include the VAT in the price you sell for.
ie - if you want to take 15 for the goods, you should sell it for 18.45 (23% VAT).
Same if you’re selling on .de or .fr or any other EU channel.
Seller_tRuvBEHDedp4q
Unfortunately yes this is how Amazon have programmed their systems and there is no workaround for FBM items sold on UK site to an EU buyer.
Amazon have to collect and remit VAT for items sold from UK into the EU. They do this by removing the EU VAT element from your sale and then adding it back on again to charge the customer. Unfortunately, when the VAT rate is higher in the country you are sending to this means you lose more profit (obviously the inverse is also true - you make more profit when the VAT rate is lower). This also effects all non VAT registered sellers as they will always lose out as Amazon will still remove the VAT element from the sale proceeds.
Obviously Amazon could have programmed their system better - they could remove UK VAT (and given you the proceeds) and they added on appropriate EU VAT (to charge the buyer). Which is how eBay have implemented it - but Amazon have decided to do it differently.
There is no workaround for FBM items advertised on the UK site and sold into the EU - except perhaps to increase postage prices by a set average amount. But if you advertise on the EU sites you can use the BIL tool to automatically adjust prices to take account of the VAT difference.
