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VAT Services on Amazon Explained

VAT Services on Amazon Explained

We look at the advantages and disadvantages of Amazon VAT Services so you can decide if it's the right option for you.

Taking care of your business’s VAT obligations can be a real headache, which is why employing VAT compliance specialists such as Taxually is a good move. We don’t just work directly with clients, though, we also offer VAT Services through our partnership with Amazon. If you’re an Amazon Seller considering Amazon VAT Services, you can find out more here.

What is VAT Services on Amazon?

Amazon VAT Services is a program that helps sellers on Amazon to comply with VAT requirements in Europe. Currently, VAT Services on Amazon is available in the UK, Germany, France, Italy, Spain, Poland, and the Czech Republic.

As an online marketplace, Amazon provides a platform for third-party sellers to reach customers in Europe. However, each country in the EU and UK has its own VAT laws and regulations, which can be complex and time-consuming for sellers to navigate.

The VAT Services on Amazon program assists sellers by providing VAT registration, calculation, and filing services for their sales in the seven European countries mentioned above. This allows sellers to focus on their business operations while ensuring that they comply with EU and UK VAT requirements.

Those who sign up to Amazon VAT Services will also be provided with guidance on VAT regulations and offered support for tax audits and disputes. By using this program, sellers can reduce the risk of non-compliance and the associated VAT penalties and fines.

Amazon VAT Services should not be confused with Amazon VAT Calculation Services, which works by automatically calculating the VAT on each sale made through Amazon. A VAT invoice is generated which sellers can then forward to their customers.

The advantages of VAT Services on Amazon

Amazon VAT Services offers several advantages to sellers who use its platform to sell their products. These include:

  • Compliance with European VAT regulations: VAT Services on Amazon helps sellers comply with the complex and frequently changing VAT regulations in Europe. This can help sellers avoid costly VAT penalties and legal issues.
  • Simplified VAT registration: Sellers can register for VAT in multiple EU countries, as well as in the UK, quickly and easily, without the need for expensive legal advice or tax consultants.
  • Accurate VAT calculations: With Amazon VAT Services, sellers can be confident that any VAT calculation will be completed accurately, removing the risk of errors that could result in incorrect VAT payments and fines.
  • Timely VAT payments: VAT from seller payouts is automatically deducted and remitted to the appropriate tax authorities within the stated deadlines, ensuring timely compliance with VAT regulations.
  • Reduced administrative burden: By handling VAT compliance on behalf of sellers, VAT Services on Amazon reduces the administrative burden of VAT compliance, allowing sellers to focus on growing their business.



The disadvantages of Amazon VAT Services

If you’re an Amazon seller, the VAT Services offered by them can be a great way to streamline your VAT responsibilities. However, there are a few downsides:

  • Unable to change VAT services provider: At the moment, when you choose your third-party provider from the Amazon selection, you won’t be able to change it to another provider once the registration process has begun.
  • Limited number of countries. Currently, Amazon’s VAT Services is only available for the UK, Germany, France, Italy, Spain, Poland, and the Czech Republic. However, further EU countries are expected to be added in the coming years.
  • Not suitable for all: While an excellent solution for many businesses, other companies may find that, due to the complexities of their business model, Amazon VAT Services is not suited to them. In this case, a tailored option is preferable.



Conclusion

Amazon VAT Services is a valuable tool for sellers on Amazon who want to expand their business in Europe while staying compliant with VAT regulations. You can easily sign up via your Amazon seller account and select Taxually as your VAT Services provider.

To find bespoke solutions for your business, optimize your VAT costs, and reach millions of new potential customers, email us at mycompliance@taxually.com and we’ll arrange a free call with one of our VAT experts.

December 9, 2023
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when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries
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