Amazon started as online book store and has grown to be the worlds largest online retailer.
Delivery duty paid to the EU via Royal Mail
Amazon are demanding that all merchants offer delivery duty paid to EU customers. This means that now the UK transition agreement has expired and there is a new trade agreement, if your products are not covered by free trade then when sold on Amazon you must deliver to your customer without them receiving an invoice for duty or VAT.
“Having buyers pay duties is in violation of the Amazon Marketplace policies and can lead to the suspension of your seller account.”
Royal Mail EU Delivery Duty Paid from Feb 2021
From the 1st of January 2021 all sales from the UK to EU customers will be treated as exports. These can be zero rated for UK VAT purposes, as currently applied for non-EU countries. But, items depending on their value and nature, may become liable to import VAT (and customs duty where applicable) when entering the EU.
Royal Mail’s services are normally delivered Delivered Duties Unpaid (DDU), where the overseas post or parcel operator will collect the import VAT (and customs duty) from the EU buyer prior to delivery, alongside a handing fee. This is against Amazon policy.
Royal Mail will be launching a Delivered Duties Paid (‘DDP’) range of solutions covering untracked and fully tracked services. They published the rate card for this service today. This service will allow the UK merchants to calculate and collect from their customer at the checkout an additional amount that will cover the cost of import VAT and customs duty alongside the DDP handling fee. This will help to avoid unexpected charges and delivery delays to the end recipient, improving the overall customer experience.
The alternative from shipping from the UK is of course to rely on Amazon FBA. However in this case you will be responsible for shipping your items to an Amazon warehouse located within the EU and pay duty when the good enter the EU.
The initial roll out will be from February 2021 for Royal Mail Tracked and Signed service.
In addition to the above, from the 1st of January 2021 customs authorities in the EU will apply customs, excise and VAT procedures to goods from the UK, in the same way that they do now for goods received from outside of the EU.
Until the 1st of July 2021 consignments with a value not exceeding €22 are relieved from import VAT and customs duty in most EU countries. This is called the Low Value Consignment Relief (‘LVCR’). Some member states have adopted a €10 or an even lower or nil threshold (e.g. in France it’s €1 and in Sweden it’s SEK 0).
On the 1st of July 2021 the EU is set to remove the LVCR entirely. The implication of this is that from this date every single UK to EU item, regardless of value, will attract VAT (and customs duty where applicable). The rate of VAT varies by country and will be payable at the rate applicable in the recipient’s country. The good news for marketplace sellers is that also from the 1st of July the marketplaces will be responsible for collecting VAT on most sales from merchants outside of the EU, removing your responsibility for charging and remitting VAT. However this won’t solve the duty part of the puzzle so you’ll still need a delivery duty paid service.
Royal Mail International Business Parcels – Delivery duty paid to the EU Tracked & Signed Services
Effective 18 January 2021
The handling fee is not included in the above pricing, most countries are €7.50-€8 i believe with a fee exceptions.
It appears to have been updated and is now £5 for all.
See the fees tab.
Thanks for this Chris.
Does anyone know if the same Amazon rules apply to orders from Amazon UK to Eu and beyond.
if a buyer from Germany, purchases from Amazon.co.uk
Do amazon deem that it should be DDP (duty Paid) ?
My understanding was that if a buyer purchases on EG Amazon.de to any eu destination then they expect it to be DDP.
All we need now is for amazon to pay their share of tax too
Bye bye shooping in UK.
vat and handling has sneaked up on most
europe is now much worse than the rest of the world to trade with
Why are EU shipments being treated differently to Non-EU, surely the process is the same as shipping to Norway or US etc etc
Just make sure you don’t have VAt calculation services by Amazon turned on, as Amazon are taking the VAT element out of the price that are charging the customer, ie knocking 20% off the final sale price, whilst also expecting you to cover all import VAT, always good that one hand doesn’t know what the other is doing!!!!!
I had not realised that, thanks for the heads up.
Now it’s only good for big sellers as they can buy in bulk for a better price and resell with taxes included. Bye-bye to small and individual sellers with home businesses.
From 31st of December we now have to pay a % in tax when buying from China. It’s having a huge impact on my small business, basically meaning I can’t save money by buying components direct anymore. It will have a huge impact on China unless big business is exempt; like with Amazon and tax, big business is treated so differently to us tiny businesses. What a world we’ve allowed to be created.
Can I double check some of your figures and where you found the information please?
I am searching for the LCVR thresholds for the EU countries, and everything I can find elsewhere states – ‘The countries that deviate from the threshold of EUR 22 are:-
Bulgaria (EUR 15.34)
Croatia (EUR 20.85),
Cyprus (EUR 17),
Denmark (EUR 10.75)
Hungary (EUR 18.82)
Romania (EUR 10 )
Sweden (EUR 20)
Most places I can find give 22 euros as a hard limit, so it’s impossible to find the correct information. Thank you very much.
B2C Europe can help with all of the questions and provide DDP tracked without the need for any other factor. Our DDP tracked rates include all charges. including any VAT due and collected and the invoiced separately back to the UK sender.
Check the De Minimis tab at the link below.
Does this mean having to pay double VAT ? You pay UK VAT and then also have to pay customer’s VAT as well to get it cleared at the destination EU country ? How is this even possible ?
Sam do you pay UK VAT on sales to the US? One would hope you treat it as an export on your VAT return and don’t pay UK VAT.
My business is based in the UK and I sell in EU marketplaces. Now for example if I buy an item from a UK supplier paying VAT and then sell it to a n EU customer say in Italy. Now I am required to pay VAT in Italy and other associated fees for the customer as well. Obviously the customer is not willing to pay any extra than he was paying before the Brexit.
So as you see I am paying double VAT ! or am I be able to reclaim the UK VAT back as now my export now being treated as exporting to a non-EU country ?
Sam it depends WHERE in the UK you are: You can zero rate most exports from:
– Great Britain to any destination outside the UK
– Northern Ireland to a destination outside the UK and EU
Lots of our eBay EU sales are now getting complaints regarding customs charges being imposed at the destination country. Also shipping to EU is now a problem- UPS have now suspended EU parcel delivery via Parcel2go website.
All in all a real mess
So whats the issue. I bought some shoes from USA and got a VAT bill from TNT. VAT Bill has been paid and now i have the shoes.
I fail to see the problem
That is a huge price increase for most items that are small low value.
I think best wait until marketplaces charge vat in july, then orders under 135gbp are not liable to duty.
So maybe that let’s a lot of items start moving again.
Then orders over 135 either refund and make them buy as separate packages or one stop shop is coming out, will be able to pay vat and duty on there.
Got to love amazon and there favour the customer not the seller rules.
Always customer used to pay taxes and duty until amazon try and re write the rule book.
Why can’t we have a british ecommerce platfrom built by british, a british social media a british tik tik.
Our rules our policies, not usa bilionair rules and policies.
The reason you cannot have a “British X” is you lot cannot even spell simple words correctly.
The problem is that –
A. Some customers are being charged VAT on items posted before December 31st
B. Due to lack of clarity on eBay some people in EU are unaware of the additional charges.
Enjoy your American shoes. I’m sure they are more comfortable coming from the land of the free.
I’m sure not all the british population are dyslexic.
When you can think of a proper reason make a valid reply.
Suck it up. Brexit the best thing that ever happened to the UK. You will see in 10 months.
The issue is far to many people in the UK got used to cheap goods comming from China with no VAT paid and these are the same people who are moaning now
Dont forget VATis what pays what the NHS.
Thanks for the party political broadcast when one wasn’t needed. Great advice- I will be sure to tell my eBay customers to “suck it up”. Real Neanderthal business acumen that.
Your very welcome if you any more advice on basic economics and how VAT pays for essential public services in the UK just give me a shout.
I see one of the requirements is to have a minimum spend of £5K with Royal Mail – that puts paid to most sole traders and small businesses I would think.
Royal Mail have delayed this service. It is not currently available and no date has been announced.