VAT information question

[0nelove]

If I use a EU account
Does eBay automatically deduct a VAT tax from my earnings before it deposits into bank

Thanks for the help

[murdered_by_ebay]

in many cases yes , this depends on where the buyer is located , ebay regularly collect both VAT from various countries and sales taxes from almost all US states

[degsey69]

In the US eBay collects state tax for the state in which the account address is in, in the UK the VAT is not collected by eBay, the seller if VAT registered pays the tax in their return, if not VAT registered no tax is required to be collected.

[0nelove]

Thanks.
So they pay the selling vat on there yearly tax returns

[degsey69]

Originally Posted by 0nelove

Thanks.
So they pay the selling vat on there yearly tax returns

Generally they pay VAT due every 3 months, the tax is on the profit earned on goods after claiming back VAT paid for those goods and expenses.

[Hank]

MBE is correct, cross border transactions may attract VAT which would be applied and collected by ebay. The laws in the EU, as we've seen on this forum, are confusing with selling being expected to register for VAT in separate countries. So much for a single union.

Are you using an EU account from outside the EU or stealthing one as an EU citizen shipping within the EU?

For example, I know from my own accounts that if I sell to the EU from the UK then ebay apply and collect VAT.

[Hank]

Originally Posted by degsey69

Generally they pay VAT due every 3 months, the tax is on the profit earned on goods after claiming back VAT paid for those goods and expenses.

C'mon, we've had this conversation before, this is nonsense.

VAT is not paid on profit and certainly not after claiming back any VAT paid!

VAT is paid on turnover.

[degsey69]

You obviously did not read what I put accurately, I said on profit after expenses, which is the cost of buying the product and claiming the VAT back on allowable item purchases and expenses.

To illustrate you buy an item for £100 and pay £20 VAT extra a total of £120 you sell it for £200 plus VAT of £40 a total of £240. On your VAT return you claim back the £20 on the purchase and pay on the £40 on the sale. £40 - £20 = £20 tax paid on a £100 profit.

This obviously is an illustration on new product bought with VAT added on purchase.

I was UK VAT registered until recently after paying it for 38 years

[Hank]

Originally Posted by degsey69

You obviously did not read what I put accurately, I said on profit after expenses, which is the cost of buying the product and claiming the VAT back on allowable item purchases and expenses.

To illustrate you buy an item for £100 and pay £20 VAT extra a total of £120 you sell it for £200 plus VAT of £40 a total of £240. On your VAT return you claim back the £20 on the purchase and pay on the £40 on the sale. £40 - £20 = £20 tax paid on a £100 profit.

This obviously is an illustration on new product bought with VAT added on purchase.

I was UK VAT registered until recently after paying it for 38 years

I read it just fine and you're wrong. To repeat, you pay VAT on turnover it has absolutely nothing to do with profit.

Let's not forget that not all stock purchases attract VAT so there's nothing to claim back and some sales are VAT exempt. It gets messy hence why VAT is paid on turnover.

How a seller recovers any VAT is their business but I repeat, it is NOT paid on profit and certainly not after deductions as you wrongly stated.

[james_112233]

Originally Posted by Hank

I read it just fine and you're wrong. To repeat, you pay VAT on turnover it has absolutely nothing to do with profit.

Let's not forget that not all stock purchases attract VAT so there's nothing to claim back and some sales are VAT exempt. It gets messy hence why VAT is paid on turnover.

How a seller recovers any VAT is their business but I repeat, it is NOT paid on profit and certainly not after deductions as you wrongly stated.

To be fair he may be talking about VAT margin scheme sales of second hand items

[Hank]

Originally Posted by james_112233

To be fair he may be talking about VAT margin scheme sales of second hand items

Nope, pretty clear to me they're not.

FYI, you can't claim back VAT on the margin scheme.

[0nelove]

Originally Posted by Hank

MBE is correct, cross border transactions may attract VAT which would be applied and collected by ebay. The laws in the EU, as we've seen on this forum, are confusing with selling being expected to register for VAT in separate countries. So much for a single union.

Are you using an EU account from outside the EU or stealthing one as an EU citizen shipping within the EU?

For example, I know from my own accounts that if I sell to the EU from the UK then ebay apply and collect VAT.

France acc selling in the US

I just don't want to waste my time if I'm going to be charged a 21% vat
If the vat is up to a human pay then I'm all for this lol

[Hank]

Originally Posted by 0nelove

France acc selling in the US

I just don't want to waste my time if I'm going to be charged a 21% vat
If the vat is up to a human pay then I'm all for this lol

Why not simply make a few sales and find out for yourself then you'll know for sure one way or the other.

[rsot]

Originally Posted by 0nelove

France acc selling in the US

I just don't want to waste my time if I'm going to be charged a 21% vat
If the vat is up to a human pay then I'm all for this lol

Might be time to test it out then

[murdered_by_ebay]

everything depends on country / state of the delivery address now

with all large countries VAT or sales tax is charged in most cases

if account is registered in france it also has an additional risk of being restricted if the annual sales to EU customers outside of france exceed 8K-9K EUR , in this case ebay will demand EU VAT registration , I don't know though if restriction will apply to EU sales only or all sales