UK VAT For Amazon Sellers

Question asked by jason patterson 4 months ago

Hi All, Apologies for being almost totally useless, but bookwork is my version of a nightmare! Only sellers on Amazon UK will likely be able to help.

We are UK VAT registered and under the Flat Rate Scheme of 7.5%..but cannot claim back any VAT as you know.

Amazon moved their invoicing only business to the UK so they appear to be paying taxes . So we are now paying VAT on their already extremely high fees. Doing the calcs it is now time to move to the 20% rate so we can reclaim VAT . Works out about the same in yearly HMRC VAT but now means we do not have a turnover threshold to adhere to.

My question is ; How do I reclaim VAT here on Clearbooks? If for example my Amazon turnover at £12,000 then if entered as £12000 turnover I assume the 20% vat will be deducted from quareterly calcs? But that does not take into account the VAT we pay on the Amazon fees. I have found a weekely excel report on VAT calculations for every sale with is 30-odd columns! But no idea how to implement this in Clearbooks.

Again, apologies. We have been Flat Rate since we started 11 years ago so this really is teaching an old dog new tricks!

Jason

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2 Replies

Hi, Assuming you are using the FRS on CB already?

You will need to change your VAT scheme on CB to the VAT Standard scheme once you have advised HMRC that you are exiting the FRS

Easy peasy to change the VAT scheme on CB (use the Help link and look at the VAT guides) - the only extra work you will have is Purchased data input to show the VAT charged by your suppliers.

You will already be using the VAT facility to charge VAT on your sales - so under the standard scheme you enter your expense items net of VAT and the system adds the VAT at 20% on standard rated supplies (including your Amazon VAT charges). Those 20% are collated in the MTD VAT return and set off against your sales 20% VAT - so reducing the total VAT you pay to HMRC - or if you VAT on purchases/supplies exceeds the VAT on Sales you get a refund from HMRC

No need for spreadsheets - all automated at the end of each reporting period - you just need to consider whether you are eligible for cash or invoice accounting - I would opt for invoice accounting as the most straight forward

Turning back to your point about Amazon fees VAT - if you enter the fees invoice into CB make sure you split the total cost into fees and Vat on fees - if you don't do that then you won't get the VAT set against your sales VAT

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Best answer
3 months ago

Many thanks, that was extremely useful.

The last part on splitting fees and vat was particularly helpful as it stopped going down the incorrect route.

3 months ago

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