VAT : UK LTD with no resident director selling exclusively on Amazon FBA uk

Hello, Based on the updated guidance from May 14, 2021, regarding "VAT and overseas goods sold to customers in the UK using online marketplaces," when goods are sold to the customer, the overseas seller is considered to have made a zero-rated supply of the goods to the online marketplace, known as a "deemed supply." The overseas seller is not required to issue invoices to the online marketplace for deemed supplies that are considered zero-rated, according to the guidance. However, as a non-resident director (Moroccan passport holder), I have noticed that Amazon UK is only classifying my sales in France and Germany as deemed supplies, not those in the UK, even though I store stock in an Amazon UK warehouse. When I applied for VAT, I was informed that I am a non-established business for VAT purposes, whereas Amazon considers me an established business (with less than 85,000 GBP in revenue) and does not collect VAT on my behalf. Under normal circumstances, Amazon should collect VAT from day one of sales, or HMRC should approve my VAT application as an established business. If I am considered non-established, I wouldn't need VAT registration according to the updated guidance of May 14, 2021. Should I contact Amazon to have my supplies considered as deemed supplies, or should I ask HMRC to recognize me as an established business for VAT purposes? If I am classified as non-established, I don't even require VAT registration based on the updated guidance. please clarify the situation

Hi,

It is important to establish where you are a non established business or not, as this does have a significant effect on the VAT treatment and whether you would need to register for VAT.

Who should register for VAT (VAT Notice 700/1)

If you are non established in the UK and the goods are held in the UK when sold, then it is the responsibility of the marketplace to account for the VAT. You would not need to register for VAT but you can do so voluntarily to recover import VAT that you incur while making a deemed zero rated supply to the marketplace.

Changes to VAT treatment of overseas goods sold to customers from 1 January 2021

If you are established in the UK then it is your responsibilty to account for the VAT. Please look at the guidance carefully and speak to the marketplace so that the VAT can be accounted for by the correct party.

If you need to change your address with HMRC, you can find guidance here:

Change your VAT registration details

Thank you.

Thanks a lot for B2C i understand that it is the responsibility of the marketplace to account for the VAT, but amazon sell to business client (b2b) our goods are sold 5 to 21£ per item. who's responsible for vat for business sales made true amazon, and we can't prevent Amazon from selling our goods to companies as non established uk company .

this is the point that is not clear for me as a uk company but not established for VAT purpose : Where a valid VAT registration number is provided the supply will be from the overseas online marketplace seller, rather than the online marketplace, to the business recipient and will follow existing VAT rules. There will be no VAT reverse charge applied to this transaction. The online marketplace must notify the overseas seller that they should account for VAT on a particular sale where a business customer provides a valid UK VAT registration number. The online marketplace should provide the overseas seller with the UK VAT registration number. so it mean we need to register for VAT or not as amazon do b2c and b2b on same account ? we can't stop amazon selling our stock to business with a UK VAT registration number ?

Hi,

You must register for VAT in the UK if you’re:

• a UK seller selling goods as a business activity in the UK, and your business’s VAT taxable turnover is more than £85,000 a year
• an overseas seller and the online marketplace provides you with the VAT details of a business customer
• an overseas seller selling goods located in Northern Ireland at the point of sale, and sold to customers in Northern Ireland
• an overseas seller with goods stored in the EU and your total sales to customers in Northern Ireland are more than £70,000 a year

Businesses selling goods in the UK using online marketplaces

Thank you.