With the end of the transition period after Brexit very much in sight, eBay has reminded sellers that they have until the end of 2020 to comply with new VAT rules.
Although many eBay sellers are affected, not everyone understands what the changes mean and what they should do to remain compliant.
To help them stay on top of what’s happening, we’ve put together a list of frequently asked questions (FAQ):
What’s changing, exactly?
The end of the transition period ends on 31 December 2020.
Starting from 1 January 2021, eBay will have to collect VAT on UK imports and remit it to the relevant authorities. This means that eBay will have to charge buyers the applicable VAT amount.
What does the change mean for eBay sellers?
From 1 January 2021, sellers affected will have to specify gross prices and VAT rates for all of their listings. This means that sellers will need to provide the applicable VAT rate used to calculate the gross price of each of the items they list.
Which sellers are affected?
eBay have stated that "UK sellers trading domestically and all sellers trading with UK buyers and listing on the UK or any EU site will need to provide both gross prices as well as the applicable VAT rate used to calculate the gross price on all listings."
What happens if sellers do not specify the VAT rates applicable to their listings?
If the sellers don’t provide a VAT rate and gross price, eBay will add VAT on top of the listed price.
Does the change apply to all sales?
The change to VAT rates applies to all sales with a value of up to £135. It’s not possible to opt out.
Are small consignments still exempt?
No, there will no longer be a VAT exemption for small consignments up to £15.
What happens if I’m not a UK business, but my goods are already in the UK?
In that case, eBay will collect and remit VAT for goods sold to UK buyers, regardless of their value.
How much time do I have to make the changes?
Sellers should list the applicable VAT rates as soon as possible.
From 1 January 2021, eBay will begin collecting and remitting VAT for UK imports. Sellers that haven’t made the change will find that eBay adds VAT on top of the listed price.
From 1 March 2021, all eBay sellers will need to add the VAT rate applicable to their listings on UK and EU sites.
We hope you now have a clearer view of what you need to do by the end of this year to comply with the new VAT-related regulations. For tips on how to update your VAT listings in bulk, check out our VAT bulk listings article.