Can someone explain VAT
Hey.
So I’ll need to vat register soon, I can find out everything from my accountant but in regards to Amazon I just have a simple question.
Right now my £12.99 product will give me a profit after Amazon fees of £7.58 (I pay other things too such as Amazon launchpad fees)
Now after I VAT register will my balance increase by MORE or LESS than £7.58?
0 replies
Seller_7VbclcPFFRTnc
If you keep the sale price at £12.99 , the ‘new’ price will be £10.83 net - plus £2.16 vat which you are collecting on behalf of hmrc
The vat paid on your purchases (if any) is deducted from the £2.16 and that difference is what you pay to hmrc
Therefore you need to increase your sale price by roughly that amount to ensure your profit remains the same
Edit - you will no longer pay vat on most amazon fees (except advertising) and that is accounted for as reverse charge on your return
