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When should I register for VAT on sales on Amazon?

  • Published: 17.03.2020
  • Updated: 20.10.2022
  • Read in: 3 min

When should I register for VAT in another country? Do I have to register for VAT abroad? I have exceeded my mail order limit and what now? Can I voluntarily register for VAT in another country?

When you sell your goods abroad, questions start to arise about where to pay VAT and when I need to register for VAT in another country.

register for VAT
To answer these questions you need to verify:

a) the value of sales of goods shipped to a given country

b) if there is a warehouse in the territory of that country where the goods are stored.

Limit of mail-order sales

Each country in the European Union has a distance selling threshold. The obligation to register for VAT arises when the value of sales (within the distance selling) on the territory of a given country exceeds the specified limit.

This limit results from the local regulations of a given country – data concerning the above limits are available on the website of the European Commission. After exceeding the limit, the obligation to register and settle VAT in a given country arises and to apply the tax rate appropriate for that country.

 

Must read about new rules with VAT in European Union since the 1st of July 2021:

What is VAT-OSS? Changes to VAT settlements in the EU for online retailers – Amazon, eBay, online shops

Storage of goods in another country

The obligation to register for VAT in another EU country also arises when you move your own goods to a warehouse located in that country – e.g. Amazon warehouse in Germany. This is due to the obligation to settle shipments of goods between different EU countries in VAT returns.

At the same time, every sale from a warehouse located e.g. in Germany will, as a rule, be subject to taxation in Germany regardless of the value of the sale. The obligation to register as a VAT payer of the countries where you have warehouses arises even before you start sending your goods from them.

If you do not know whether you are obliged to register for VAT in the UK, Germany, or another EU country, please contact us for assistance >>

Tomasz Połeć Tax advisor nr 12104. Co-founder and member of the board of Taxology.