Amazon European VAT tax details and compliance requirements

The VAT tax issue on Amazon’s European site has always attracted much attention, especially when sellers on the British and German sites have successively had their sales permissions revoked. The VAT tax issue has become a hot topic in the e-commerce industry. This article will comprehensively analyze Amazon’s VAT tax regulations and their impact on sellers.

What is VAT tax?

VAT, full name Value Added Tax, is a consumption tax levied on goods and services in the European Union. Starting from 2017, the European Union requires merchants on the Amazon platform to register a VAT tax number and pay VAT tax on time.

VAT rate

The VAT rate stipulated by the EU is roughly 20%, but there are slight differences among countries. For example, Germany is 19%, France is 20%, Italy is 22%, the United Kingdom is 20%, Belgium is 21%, Sweden is 25%, etc. . In addition, certain products enjoy lower tax rates, such as heating units, boilers, etc.

VAT tax FAQ

1. The consequences of not adding a VAT tax number

According to British tax law, all accounts operating on Amazon’s UK site must add a VAT tax number and make true, timely and accurate tax returns. Violation of regulations may result in goods seizure, fines, account closure, etc.

2. Can I use someone else’s VAT number?

Each VAT tax number uniquely corresponds to a reporting entity. Abuse or repeated use may lead to unclear taxation or even account association.

3. Risks of using freight forwarding VAT number

If multiple sellers use the same VAT number for customs clearance, the customs clearance entity will not match the actual seller, and the import tax cannot be deducted, and the goods may be detained by the customs due to under-declaration and other reasons.

4. Do small sellers need to register for VAT?

Regardless of scale, all products sold on Amazon need to register a VAT tax number in accordance with the law and file quarterly returns.

5. VAT tax number processing after changing company name

Just changing the name will not affect the continued use of the original VAT number, but the UK Revenue and Customs needs to be notified to update the information.

6. VAT declaration without sales

Even if there is no sales, you still need to make a zero declaration every quarter; if there is import customs clearance, you need to make a non-zero declaration; when there are sales, declare according to the actual situation and may need to pay taxes.

7. Materials required for quarterly VAT declaration

Including import VAT tax documents, output documents, purchasing and sales data, etc.

8. Can a UK VAT number be used in other EU countries?

The British VAT number can be used for customs clearance in other EU countries, but the storage location needs to register a local VAT tax number.

9. Can direct mail avoid tax?

According to EU regulations, goods with a value below a certain amount are tax-free, but discrepancies between the declared value and the actual product may result in additional taxes.

10. Do I need to pay back taxes before applying?

When applying for a VAT tax number, you should truthfully disclose the information to the tax department and pay the tax amount due.

The importance of Spanish station VAT emails

Amazon Spain reminds sellers to fulfill their reporting and tax payment obligations through VAT emails. The emails contain information such as declaration deadlines and tax requirements, and sellers should take them seriously.

Advertising VAT tax deduction

Amazon advertising VAT tax deduction must meet certain conditions. Sellers need to add a VAT tax number and confirm the advertising VAT collection ratio, which can be viewed through data reports or advertising campaign management.

Solution to account being blocked due to VAT issues

For accounts that have been blocked due to VAT issues, sellers should immediately apply for and upload a tax number. If the account has been uploaded but is still blocked, it may have been blocked by mistake, and you need to contact a tax agent to assist in unblocking it.

To sum up, VAT tax issues are very important for Amazon European sellers. Only by operating in compliance can unnecessary troubles be avoided.