VAT on EU sales via Amazon market place

Question

I have been asked the following question by a friend who is a seller on Amazon and other similar market place.

He distance sells to individual customers in EU and is considering selling through FBA centres in EU.

Q1. He is required to register in EU for VAT – how can he do this himself without using agents?

Q2. Distance selling threshold, are these exclusive or inclusive of VAT?

Q3. How is VAT, EC Sales List and Intrastat accounted both in UK and in EU?

Q4. Once registered for VAT in EU for FBA Sales – are distance sales to be included even if below threshold. Is voluntarily registration allowed and how is this notified?

I have searched on line for answers but the information is not conclusive. Any help or direction is appreciated.

Thanks.

Answer

Hey there,

These are just my finding from having a quick look on the internet – I don’t proclaim to have any experience in distance selling so I can help with the search but can’t really advise I’m afraid. Would recommend speaking to HMRC about anything related to UK VAT/Intrastat in more detail.

Q1.

I reckon that he could do this himself by approaching the customs authorities in the relevant country/countries – probably a case of form filling and then waiting a few weeks for the paperwork to be processed. The European Commission’s website should be able to point you in right direction for contact details / websites.

Q2.

I think he would have to charge VAT in accordance with local VAT procedures/rates. Threshold is exclusive of VAT in the UK at least (notice 60 section 5.1). Not sure about EU but would guess it would be pretty much synonymous

https://www.gov.uk/government/publications/notice-60-intrastat-general-guide/notice-60-intrastat-general-guide#what-records-must-i-keep-and-will-i-be-visited
http://www.vatlive.com/eu-vat-rules/internet-and-ecommerce-vat/
http://www.vatlive.com/eu-vat-rules/distance-selling-eu-vat-thresholds/

Q3.

https://www.gov.uk/government/publications/notice-60-intrastat-general-guide/notice-60-intrastat-general-guide
UK Intrastat – https://www.gov.uk/guidance/introduction-to-intrastat

Q4.

Notice 60 has a wealth on information on this for UK – see section 3.2 specifically.

What country is he specifically looking at? I might be able to take a better look when I have some more time.

Kind regards,

Simon.

Answer

Simon,

Thank you for your information. Still unable to find the websites or contact details of the VAT authorities of specific EU countries. The language is also a barrier. The countries are Germany, France, Italy and Spain.

This is an administrative nightmare when there is no common language or translated information readily available resulting into costs, defaults and penalties and curtailing expansion.

Answer

Hi there,

That doesn’t surprise me too much. Think I read that many countries are becoming reluctant to provide translated documentation because they were, believe it or not, causing misinterpretations.

I imagine there will be people in your network who speak the native languages of those countries and can help. Or at least they shouldn’t be too difficult to source of not.

As the cost of moving goods around the EU by road / courier is relatively nominal, do you think that it could potentially be a case of the FBAs not being worth it?

I don’t have the time to take a good look for a day or so but I will see if I can at least find you contact details for relevant authorities when I get chance if you haven’t already sourced them by then.

Kind regards,

Simon.

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