What You Need To Know About Amazon Fees After Brexit

amazon fees and brexit

If you are based in the UK and are selling on the Amazon platform, this article is definitely for you.

We will help you understand the impact and the changes that Brexit has brought about. We help you adapt your business with the new set of rules and regulations brought by Brexit.

At Your Ecommerce Accountant specialize in helping eCommerce businesses with their accounting practices. We are professional Chartered accountants based in the UK that can help you manage your books following the latest post-Brexit rules .

What is Brexit and how will it affect Amazon?

Brexit is the popular term for Britain’s departure from the European Union. By leaving the European Union, the United Kingdom has become a separate entity with separate rules and guidelines from the rest of the members of the Union.

The exit from the union gave a full reset to how the UK will interact with the rest of the EU. And that includes the existing rules and regulations regarding trade with other member countries of the union.

And one of the most common questions that pop out from Brexit is, do reverse charges still apply?

Reverse Charges on Amazon Fees

Fortunately, Reverse charges still apply on your Amazon fees post-Brexit. However, this will only apply if your business is VAT-registered.

If your business is VAT-registered, then Amazon will treat the transaction as a business-to-business transaction, which means that a reverse charge will be applied.

On other hand, if your business is not VAT-registered, then you will be treated as a consumer which will result in a 20% VAT charge.

Thus, it is essential for your business to be VAT-registered, or at the very least, plan to register for a VAT ID soon.

If you want to find out more about whether you need to register for VAT to sell on Amazon, find out more. 

What Are The Other Changes on Amazon Post-Brexit?

At this point of the Brexit, there have been a few changes on Amazon that you have to take note of. Knowing these things can help you take advantage and maximize opportunities and minimize potential losses.

Increase in Local Sales

One of the most obvious impacts of Brexit is the increase in local trade. As it becomes harder for foreign entities to sell in the UK, local sellers have an opportunity to capitalise on the gap.

While this will eventually change in relation to globalization, now is the best time for local sellers on Amazon to pump up their efforts in selling locally.

Amazon UK has left European Fulfilment Network

Brexit resulted in Amazon UK leaving the European Fulfilment network, which means you won’t be able to keep inventory in the UK and sell them across Europe. You will have to separate your UK inventory with your EU inventory and pay the fees and taxes that are required in that country.

This means separate and additional fees and taxes for your “international” goods. So, if you have international customers, you might want to review and make adjustments with your international business.

Your Ecommerce Accountant are experts in international trade and tariff laws. We can help you understand its impact on your business – which will help you make better decisions moving forward post-Brexit.

Multiple EORI numbers for your Business

Most of you will be familiar with EORI or Economic Registration and Identification. This is used in monitoring imports and exports within the European Union. You will now have to secure a separate EORI for each international country that you are selling to.

Amazon sellers based in the UK will now have to secure separate EORI numbers for every country that they do business in.

Without the EORI number, you will not be able to do business internationally, as well as forfeit the reverse charges applied for business-to-business transactions.

In the end, while all of these may seem confusing and a bit of a hassle, it is very important for eCommerce businesses to be updated with the latest rules and guidelines regarding trade, especially post-Brexit.

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If you want to learn more and understand the effects of Brexit on your eCommerce business, we at Your Ecommerce Accountants are always here to help. We are dedicated Amazon seller accountants who can help you grow your business.  Click here for a free consultation with one of our chartered accountants.

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Why not grab a Free 30 Minute Consultation with Ben, he can answer any questions you have about your e-commerce or marketplace business, guide you on tax efficiency and see if we can help you.

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Ben Sztejka ACA

Ben Sztejka ACA

We are a leading e-commerce accounting firm, focused on assisting UK and EU businesses in thriving online. With expertise in Amazon FBA, Shopify, Etsy, and eBay, we provide customised tax compliance and reporting solutions. Our team combines 10 years of experience as ICAEW chartered accountants with 15 years in e-commerce, offering unparalleled support to both e-commerce businesses and accountants.

Ben Sztejka ACA

Ben Sztejka ACA

Head Accountant & Director here at Your Ecommerce Accountant. Specialises in Ecommerce Accounting drawn from his own experience in Ecommerce and selling on marketplaces like eBay, Amazon & ETSY.

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