Ebay UK VAT

Hi I am newley registered for VAT on ebay and am getting conflicting advice. I sell items within the UK.I see that Ebay adds VAT to the buyers invoice as VAT INCLUDED. When the auction ends. I do not receive the 20% VAT added to my final price so i can put it aside to send to HMRC on my VAT return. This seems unfair as it basically means that i am paying 20% vat out of my sales and 20% income tax. My undstanding of VAT is that it is added on to an invoice not to be borne by the seller. Ebay does not allow vat to be added to the final auction price,only the STARTING price which could be a big difference. My question is DOES EBAY remitt the VAT on my sales on my behalf to HMRC??

Hi,

If you are a business which belongs in the UK and are selling goods via a marketplace, then it is the seller who is reponsible for the VAT, not the marketplace.

You need to discuss with the marketplace what value you are selling the goods for as it appears that eBay are taking this value as a VAT inclusive value but you are taking it as a VAT exclusive value.

The amount which you sell an item for is your decision and so we would suggest to contact the marketplace place to discuss this.

If the marketplace can only accept the seller price as a VAT inclusive figure then you may need to increase your prices to reflect this.

Thank you.

Thankyou for getting back It is not possible to increase the price at an AUCTION however, and it is not my decision. That is why ebay do not like to add VAT on the final auction price, as they would lose buyers if VAT was added on top of an auction price. They do not allow you to add VAT on the end price If the price is fixed then of course you can increase it to cover the VAT cost. In the buyers invoice EBAY shows the breakdown of the transaction and states the final bid price, and the VAT, but nothing is ADDED to the bid price. It is taken away from the sellers profit My argument here is that if i cannot add VAT to the final bid price i end up paying the VAT out of my pocket, i always thought that VAT should be paid by the buyer then the seller receives it and puts it aside to remit to Hmrc on the quarterly return The way it is at the moment if i have no control over the VAT it is an extra tax on top of my income tax. For orders to Europe, Ebay remits the VAT DIRECTLY to the tax authorities

Hi Jazzman24Porter,
We can only confirm that if you are VAT registered then you must charge VAT on your sale.
HMRC can't dictate or comment on the amount on which the VAT is to be charged.
We also can't comment on how the marketplace deals with these sales and whether the final price is VAT inclusive or VAT exclusive.
Thank you.

I have the same issue, I've spoken to ebay and they said they collect the VAT and report it to HMRC on my behalf. So does that mean I need to put £0 in box 1 when I do my VAT return?

Hi,

If you are a non established business sending goods to the UK, then the marketplace would be responsible for accounting for the VAT on goods of any value, if the goods are already in the UK and goods below a value of £135 if the goods are sent from overseas.

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

Thank you.