Amazon charging my customers VAT despite it being 0 rated
Hi,
I'm a newly VAT registered seller yet to complete my first return and so still dont really understand it all yet.
I have been selling a 0 VAT rated ASIN (i know its 0 rated bc my supplier did not charge VAT on it) for a while and have only just seen on the invoices amazon auto generate for my customers that VAT is being charged to them.
This has really messed my profit calcs and im now at a loss. Surely amazon have made the error here as it is defo a 0 rated item but they're issuing 20% VAT invoices to customers on my behalf? How can I have this reversed? Moreover, how can i look at the VAT rate amazon thinks an ASIN is so i can ensure it matches my suppliers rate, before chosing to join the buy box?
Any help would be very appreciated. Thanks
Amazon charging my customers VAT despite it being 0 rated
Hi,
I'm a newly VAT registered seller yet to complete my first return and so still dont really understand it all yet.
I have been selling a 0 VAT rated ASIN (i know its 0 rated bc my supplier did not charge VAT on it) for a while and have only just seen on the invoices amazon auto generate for my customers that VAT is being charged to them.
This has really messed my profit calcs and im now at a loss. Surely amazon have made the error here as it is defo a 0 rated item but they're issuing 20% VAT invoices to customers on my behalf? How can I have this reversed? Moreover, how can i look at the VAT rate amazon thinks an ASIN is so i can ensure it matches my suppliers rate, before chosing to join the buy box?
Any help would be very appreciated. Thanks
18 replies
Seller_ZJhFeE3tNKzfh
What is the ASIN of the product? Just because your supplier is not charging VAT - doesn't mean its not a zero rated product.
Seller_w5M0a9wYTqQt2
Really? They are a very big company and I'd be surprised that they would get this wrong. I asked them to double check it and they said yh its 0 rated.
In terms of the ASIN i'd rather not reveal it here.
Seller_ZJhFeE3tNKzfh
Fair enough - probably best to start here
Seller_QuM1AZgzfU9x4
None of your in-stock products jump out as being zero rated, but the post above has the link to find out more.
Seller_w5M0a9wYTqQt2
yh im out of stock in at the moment. Will drop it though tbh.
Seller_tRuvBEHDedp4q
Companies of all sizes have been known to make mistakes on whether goods should attract VAT or not.
If you do not want to share the ASIN then how about describing the goods in generic terms to see if anyone else knows the correct VAT code?
For example - 'dressing gown for age 12' would be zero rated, but a 'dressing gown for age 16' would have standard VAT applied.
Seller_w5M0a9wYTqQt2
Its a powder that you mix into water or any drink. Helps for when you do exercise.
Seller_ZJhFeE3tNKzfh
google excepted item 4a.
That would suggest sports nutrition drinks (including powders) are standard rate
Seller_tRuvBEHDedp4q
Yes seems like company you buying from has made a mistake. Go back and ask them to check this taken from gov website:
VFOOD7590 - Excepted items: beverages: Item 4A: sports drinks
Excepted item 4A was introduced into the VAT Law specifically to standard rate sports drinks. It became effective from 1 October 2012.
Prior to 1 October 2012 most sports drinks, being beverages (designed to rehydrate, quench thirst or give pleasure), which meant that they were standard-rated for VAT under excepted item 4 to the VAT zero rate. However, some sports drinks were zero rated because the Courts found that they were not beverages due to their high nutritional content. These are known as sports nutrition drinks.
Changes effective from 1 October 2012.
With effect from 1 October 2012 excepted item 4A ensures that sports nutrition drinks are taxed at the standard rate of VAT to ensure consistency with other sports drinks. The new excepted item 4A taxes at the standard rate ‘sports drinks that are advertised or marketed as products designed to enhance physical performance, accelerate recovery after exercise or build bulk, and other similar drinks, including (in either case) syrups, concentrates, essences, powders, crystals or other products for the preparation of such drinks.’
The products affected are those supplied:
pre-mixed in liquid form or as syrups, concentrates, essences, powders, crystals or other products that can be made up into a liquid by the consumer.
They are generally marketed as supplying energy to enhance performance, accelerating recovery after exercise, providing energy, or building bulk and often contain creatine.
Seller_SnNztJIII3ZP5
When you inputted the data for your product did you complete the section on VAT rate and set that to zero ?
Seller_d8YGbIjNqwFxn
Did you set the Product Tax Type correctly against the product
For example if you were selling children's clothing you would set it to A_CLTH_CHILD and then Amazon would issue zero rated VAT invoices.
