Why eBay charges VAT to my buyers, even abroad?

JacobEdgar

As the title implies, for a few years now, eBay charges VAT to anything I sell, even if it is a pair of second hand socks. I was under the impression that VAT only applied to new goods, or maybe to businesses, but I've checked and is charged no matter you are a private or self employed seller.

What is more amusing, is that VAT is also charged to EU buyers, but curiously, not to USA buyers (and some other locations).

My question is why, and is there any way to legally avoid this? I can't compete with other sellers in EU for example, that sells same items and don't have to pay this. I've checked and doesn't even matter if the item is not in the UK and does never enter UK, just the registration address of the seller.

I know that as self employed I could theoretically register for a VAT number, which will avoid this, but as far as I know I would have to pay that VAT to HMRC all the same in my declaration.

savergrant

Where are you seeing VAT being charged?

JacobEdgar

In any order I sell. For example, I listed on eBay.com a Lot of Model Kits, it sold for 30 USD, shipping was 20 USD, and the buyer in France, had to pay an extra 10 USD as VAT. That is a solid 20 % mark up. It's what I would usually get as profit more or less, with this charge, if I want to sell I usually don't earn anything.

sheramber

https://forums.moneysavingexpert.com/discussion/comment/81913513#Comment_81913513

Items delivered to EU countries – Value Added Tax (VAT)

If the item is being shipped from outside the EU into an EU country, the buyer or recipient may need to pay VAT and customs duty.

As of 1 July 2021, eBay is required to collect VAT on certain orders delivered to EU addresses. For consignments where eBay does not collect taxes, or for orders above a certain value, buyers may need to pay additional import fees (e.g. VAT and duties) as part of clearing their parcel through customs, or when their order is delivered.

Learn more about how to request a VAT refund.

https://www.ebay.com/help/buying/paying-items/paying-tax-ebay-purchases?id=4771#section12

XzavierWalnut

https://forums.moneysavingexpert.com/discussion/comment/81913476#Comment_81913476

I noticed vat on an item I sold recently which I had not spotted in the past. Just checked on on my sales it is applied to the postage.

sheramber

is it UK VAT or EU VAT?

savergrant

https://forums.moneysavingexpert.com/discussion/comment/81914093#Comment_81914093

For simple delivery items ebay buys the postage label and shows the price with a vat breakdown. It is (or should be) the same total price as if you'd purchased the label through packlink.

JacobEdgar

https://forums.moneysavingexpert.com/discussion/comment/81913532#Comment_81913532

Yes, but it also charges VAT to UK buyers buying in UK. And it also charges VAT, even if the item I am selling is in Europe, just because my residence is in UK.

VAT in France and England is both 20 %, so I don't know.

What is absolutely absurd, is that if the buyer is in Canada, he doesn't pay VAT.

If the VAT needs to be paid because I reside in UK and that is the law, then my Canadian buyer should also pay VAT.

If the VAT is paid because the buyer resides in UK or France and those countries require VAT to be paid by the buyer, then that cannot be either, because I know that people in France doesn't pay VAT in everything they buy off eBay.

Unless eBay is just considering everything sold by a seller residing outside EU, is outside EU, regardless of the location of the item.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/81917416#Comment_81917416

It'll depend on what the tax treaties say or don't say. The person in Canada may need to pay GST and/or HST and duties to the Canadian government(s) on the item.

"You can zero-rate the sale of your goods to Canada, provided you get and keep evidence of your export, and comply with all other laws."

https://www.business.gov.uk/export-from-uk/markets/canada/#:~:text=VAT,comply%20with%20all%20other%20laws.