Amazon now keeping 20% of the total sale value to account for sales tax?
Ive got reimbursements coming through for various reasons which are now 20% lighter than they were before.
as they are not an authorised agent and also the fact that my VAT rate isnt 20% how do i get this sorted?
Ive been told that there a VAT department but they aren’t answering any queries and im flabbergasted as to the amount of money im now missing in total.
Amazon now keeping 20% of the total sale value to account for sales tax?
Ive got reimbursements coming through for various reasons which are now 20% lighter than they were before.
as they are not an authorised agent and also the fact that my VAT rate isnt 20% how do i get this sorted?
Ive been told that there a VAT department but they aren’t answering any queries and im flabbergasted as to the amount of money im now missing in total.
0 replies
Seller_5xogxoILPrN4X
Why is your VAT rate not 20% if you sell in the UK
Seller_0pkMTMROIPEmY
Amazon Reimbursements more recently are now coming through significantly less than the original sales value , for example one we had 19th August sold value £351.62 , credit value £362.05, Reimbursement value £286.10, in our situation this is not VAT related and is not a straight 20% deduction in value, Seller Supports response to this discrepancy is below;
Thank you for contacting Amazon Services Europe. I hope this email finds you well.
This is Kate, the account associate from FBA and I will be assisting you today regarding your case.
In a review of your email, I understand that you would like to know why we reimburse you the below cost price of the item for the Order ID: 202-8717638-9137153.
Please be informed that the reimbursement was determined in accordance to the fair market value of the item. Fair market value (FMV) is an estimate of the market value of an item based on multiple factors including your sales history and the price you and other sellers list the product for on Amazon.co.uk. As you are well aware that the market is very dynamic and the fair market value of any item is directly dependent on the market conditions, the value of the item can change according to market conditions.
This credit was issued per the “Lost and Damaged Inventory Reimbursement Policy”. The policy Quotes "Under circumstances where Amazon takes responsibility for paying you the Replacement Value of a Unit as set forth in the FBA Service Terms, we will reimburse you based on our determination of the Unit’s value less applicable FBA and Selling on Amazon fees.
We will consider several factors in determining a Unit’s value, including your sales history and the price you and other sellers list the product for on Amazon.co.uk"
However, to make a request for the reevaluate of the reimbursement, please reply to this email and provide us with the invoices so we can proceed with the possible review of the reimbursement amount that we have provided.
My sincerest apologies for making you take an additional step regarding this issue, it is just to ensure we provide you exact resolution to avoid any discrepancy. Your understanding and co-operation on this issue are appreciated.
Please know that we have the feasibility of keeping a case open only for 72 business hours and therefore, I kindly request you to write to us within this duration so that we can help you out with this issue.
Seller_Nprc5XWvdLYk9
fba customer buys an item through amazon and vendor declares the transaction and pays the vat on their vat return
fba customer requests a return via amazon - the seller is debited the refund and seller deducts the refund transaction from their next vat return
the customer at this point is still in possession of the vat invoice showing vat paid.
no refund to the customer has been given by amazon at this point.
but customer decides to keep the item,
vendor has to wait 45 days and is then give reimbursement by Amazon (based on fair market value and less vat),
yet the customer has still paid the full original amount and has the vat invoice.
but it seems no-one has paid the vat to HMRC?
this does not add up!
Seller_o6hgIlcziBbnx
Have a look at this.
lease see the reimbursement breakdown below:
Rationale: SOLD_AT_PRICE
Unit Value with Tax: 119.99 GBP
Unit Tax: 20.00 GBP
Unit Value: 99.99 GBP
Unit Fees: 10.37 GBP
Net Amount (Value - Fees): 89.62 GBP
We understand that this is not an answer that you are looking for, but seller support cannot issue you with a reimbursement that goes against our Policy:
Its actually galling me that they keep quoting policy where theres nothing in policy that supports this deduction. Coupled with the fact they aren’t an authorised collection agent for HMRC and Im not on the 20% scheme
Seller_0pkMTMROIPEmY
A further response to the case does now confirm reimbursement are excluding VAT , we are VAT Registered also although I don’t think this makes any difference whether you are VAT registered or not the remibursements are now EX VAT.
Thank you for contacting us.
With reference to your e-mail I understand that you have concern regarding order id 202-XXXXXXX-XXXXXX in which you claim that you got the less reimbursement.
It will be our pleasure to help you in the best possible way, however, we would need some additional information from you to get this concern sorted. Please, provide the purchase invoices for the Order ID.
For your second concern, I would like to inform you that FMV is an automated process and it does not include VAT.
I am sorry for making you take an additional step regarding this issue, it is just to ensure we provide you a clear resolution to avoid any discrepancy. Your understanding and co-operation on this issue is appreciated.
We would gladly take this case forward as soon as we receive the required information. I would also like to suggest you to respond at the earliest so that we are quickly able to resolve this concern to your satisfaction.
We appreciate your patience and look forward to hearing from you.
Awaiting your response.
Thank you for selling with Amazon.
Gurbinderpal S.
Amazon.co.uk Seller Support
Seller_0pkMTMROIPEmY
Interestingly we are not enroled on the VAT Calculation service although we are VAT registered, based on Amazon’s own policy deduction of VAT from Reimbursements should not apply unless you are enrolled on the VAT Calculation service, there is an interesting article about this issue on TameBay;
How do you account for the missing VAT?
Put aside the fact that your cash flow is out by the VAT amount until you can correct your accounts, the sellers we’ve spoken to have no idea as to how they should account for the missing VAT on their VAT returns. Having consulted specialist Tax Advisors they have also been unable to suggest an accounting method to handle the missing VAT.
Sellers have raised this situation with Amazon who have stonewalled and (perhaps unsurprisingly as this is a relatively new edge case and quite complicated) been unable to offer a resolution or explain why the VAT discrepancies are occurring.
If you are using Amazon VAT Calculation Services and have had returns which were reimbursed, it may be worth checking your accounts to see if you too have missing VAT on reimbursements.
The only solution currently available would appear to be turning off Amazon VAT Calculation Services and providing your own VAT invoices upon request.
Seller_fMsCVAHNu4txH
They’re not collecting the VAT amount on behalf of HMRC, they’re just not paying it to you because they (wrongly) assume that the money was never yours to begin with.
Reimbursements are like insurance pay-outs they’re not sales, and are exempt from VAT. So that part of the sale value would never have been yours to begin with.
A whole different issue which Amazon have probably neglected to consider when they introduced the policy. Presumably they’re just using the items VAT classification, rather than the sellers real position.
You can’t be the only one experiencing this though, I’m surprised that more people aren’t noticing a discrepancy.
Seller_0pkMTMROIPEmY
Seller Supports Reponse to clarify the position;
As per further review into your query, we have found that you were correctly reimbursed and there is no further reimbursement due as per the criteria.
Seller Support is unable to provide further information on this situation.
We appreciate your understanding that our decision regarding this matter is final.
Warm Regards.
Thank you for selling with Amazon.
Diane L.
Amazon.co.uk Seller Support
