Sounds like you might benefit from a platform like eBay doing it for you - that way you should just be able to declare the net amount of the sale, sans UK VAT to the fisc (and possibly the eBay fee can be added as an expense as well).
BUT (and in answer to Kirstea’s point) that adds the eBay fees into the equation - which are fairly high at ~11%
UK VAT and import duty on top of the ticket price and especially if eBay handle the item through their global shipping programme (which doesn’t have that good a reputation for fragile items) would put me off both selling a buying from the EU, and I suspect the view is the same from France - it certainly has stopped me getting stuff from the US.
You only need to register for VAT in the U.K. if you are a U.K. company and your turnover is £85k plus. The main reason why companies with less turnover register is that they can reclaim VAT paid on purchases but of course you then have to charge VAT on sales and do quarterly returns. If you buy and sell exclusively in the U.K. it is worth doing. If your business is registered in France you must register in France if you meet the criteria. Sales will either be zero rated, exempt, 20% or 10% if the item is over 100 years old.
The last time I looked, shipping fees etc had to be included in the selling price - which means that your selling price is artificially inflated and eBay gets to keep a big slice of the shipping costs. My advice (before the Brexit nonsense started) was that it was the sales total that had to be declared as an AE.
That is the case for a UK based business, but if you’re based outside the UK you need to register with HMRC for VAT even if your turnover is substantially below the 85k threshold. This advice was from the UK accountant who used to deal with my old UK limited company.
Indeed - though when I have looked at (and occasionally bought) items from the US it is clear that the tax/duty & shipping are on top of the “price” for the item. I’d expect that to be the same when viewing EU purchases post Brexshite.
I quite understand that it would be a non-starter if you have to declare the gross value, including UK VAT, shipping and eBay fees to the fisc and have to pay tax&social charges on probably twice what you are getting. I imagine that would wipe all the profit.
But the way eBay global shipping worked in the US was that the vendor sent the item to eBay (or rather their global shipping partner) who forward it on to the end customer. The vendor just sees a “US Sale” and eBay handle the tax side of things.
You can see the import charges listed and they are in addition to the sale price, I also suspect most of that shipping price goes to the global shipping programme.
At the moment I’m not seeing that on EU sales, so eBay hasn’t switched over yet, it seems - but it is possible that they will do so at some point.
Actually, just looking at your original comment…
You don’t have to include shipping price in the item price on eBay, although a lot of sellers do so because of the psychology of the buying process (eg an item which costs £10 and £4.50 to post will probably be perceived as less value than the same item at, say, £17.50 “P&P included”).
You’re correct in that you’ll get the gross fee from the buyer in that scenario and it is then up to you to deduct expenses.
You never see the money relating to VAT - Etsy are the VAT registered entity they take the customers money and pass it on to HMRC - its external to “you”.
I’ve received conflicting advice on this. Ask your local tax office and please let us know what they say! Mine said I must declare the total shown on the invoice.
This is what I do. No one wants to overpay obviously but I’d rather be safe than sorry. If the VAT is on the invoice, which it is for items under £135, then it’s part of the bill so I go by the bottom figure with it included. I’d rather they told me I’ve done it wrong and paid too much than not paid enough!
"## What is the impact on the calculation of social contributions?
You pay back to the state the VAT that you charge your customers. This does not therefore constitute income for you. When making your declaration (monthly or quarterly) of turnover, you must therefore only mention the sums collected excluding tax (HT) . It is on this basis that your social contributions will be calculated."
That’s nice and clear but it is from 2019. The position may be different regarding cross border taxes eu-uk post Brexit. Asking your local tax office is the best way to get a definitive reply…
That’s interesting! The issue is of course, that I am not charging french VAT, but the order does contain another country’s VAT/ sales tax. I have always thought it weird that my invoices are meant to contain the disclaimer that they are exempt from VAT, and they are exempt of being charged french VAT, but they do of course include the tax of another country.
In one sense although it is called VAT, is it VAT as far as the french government are concerned as they can’t get their mitts anywhere near it. As your quote says, you shouldn’t include french TVA because you then pay it on to the french government, so that makes perfect sense, but do France actually consider foreign sales taxes as the same or is it just considered another charge like delivery that they can include? I have no idea about the intricacies, as I am currently making very clear.
