Does Amazon in Europe have VAT? In what cases do I need to register for VAT?

After opening a store on the Amazon platform, merchants need to deal with many issues. Many merchants have heard about the VAT tax issue. In fact, many people are unfamiliar with this VAT tax because there is no such tax in domestic e-commerce. So does Amazon Europe have VAT?

Does Amazon Europe have VAT?

Self-delivery accounts do not need to register VAT, but if you have already registered VAT, then no matter whether you have sales or not, whether you are self-delivering or FBA, you need to declare it on time. If the seller does not declare, the tax bureau will estimate the tax amount for the seller. Sellers who want to develop in the European market must follow the tax bureau's requirements in terms of taxation, and the tax bureau's management will only become more and more strict.

If the seller does not want to give up the account, they must first deal with the tax issue if the tax bureau has already notified them to pay the back taxes. And if the seller does not respond to the email within the time specified by the tax bureau, the tax bureau will notify Amazon to close its account.

Under what circumstances do you need to register for VAT?

1) Shipment from outside the EU to warehousing within the EU.

2) B2C distance sales within the EU break the tax threshold in the destination country.

3) Distribution of goods between warehouses in different countries within the EU.

4) Import goods into the EU.

5) Selling goods to EU business sellers.

Anyone who meets any of the above five conditions shall register for VAT.

Once sales exceed the distance selling threshold in an EU country, sellers are obliged to register for VAT in that country.

Consequences of not registering for VAT:

1. Export goods cannot enjoy import VAT refund.

2. The goods may be detained and unable to clear customs.

3. Failure to provide valid VAT invoices reduces the turnover rate and preferential rate of overseas customers.

4. Normal sales on the e-commerce platform cannot be guaranteed.

You must pay VAT to open a store on Amazon Europe. This is a legal requirement in the EU, so there is no way to avoid it. It is recommended that you register for a VAT tax number directly to pay taxes, which will make payment more convenient. If you do not pay and the platform finds out, your store may be closed.

Recommended reading:

How do I contact an Amazon account manager? What is an account manager?

What does Amazon European VAT mean? In what situations does Amazon need to register VAT?

How long does it usually take for Amazon Europe to conduct a KYC audit?