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Amazon UK are charging me 25% VAT.


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Showing 1-24 of 24 posts in this discussion
Initial post: 10 May 2012 20:16:56 BDT
Amazon UK charge me 25% VAT on all puchases from themselves.
I live in Sweden, am from the UK. Vat in Sweden is 25%
I buy lots of items on the internet from other UK firms, and am charged the listed price, which includes the new rate of VAT, 20%.
Is what Amazon are doing Legal according to EU trade law ?
I thought that the rate of VAT charged in the EU, should be the rate
applicable in the country at the point of sale... in this case 20%
I contacted Amazon, but received a very unsatisfactory explanation.
I would though like to mention, that I buy many items from Amazon UK, and apart from this VAT irritation, am extremely satisfied:good prices, quality products, quick delivery etc.
So what's the score here with regards to my VAT issue ?

Posted on 11 May 2012 00:20:22 BDT
Last edited by the author on 11 May 2012 00:22:39 BDT
OutBound says:
Amazon is correct. It has by law to pay to the Swedish authorities VAT at 25% . It pay capital gains tax in Luxembourg.Where the goods are sent from is immaterial.I receive goods in Spain and pay the Spanish rate of 18% and have to pay 4% VAT on books whereas in the UK books are VAT free.

In reply to an earlier post on 11 May 2012 03:57:49 BDT
OK, So you mean that all the other companies in the UK I've been doing business with these past years, have been giving me a discount. Discount being the difference between Swedish, and UK vat. At todays rates this would be 5%. I also thought, that if I purchased an item in the UK (giving them my Swedish VAT number),which was to be sold in Sweden, no vat was charged in the UK, but 25% VAT is added to the price, when sold in Sweden.(At the point of sale.) Please note that my original comment/question, relates to me being a private person, the second comment is me being a VAT registered business.

Posted on 11 May 2012 10:05:44 BDT
I'm pretty sure that the EU VAT rules dictate that the VAT charged should be at the rate where the item is dispatched to, not where the item is sent from, so Amazon are operating as they are instructed to do so legally while the other companies are not.

In reply to an earlier post on 11 May 2012 20:38:40 BDT
You could be right, I just thought I would seek other people's opinion.
VAT within the EU seems to be quite a complicated issue. I thought once again,that as there are so many rates on different items in different countries," point of sale" was the deciding factor.

In reply to an earlier post on 11 May 2012 21:02:02 BDT
The corporate tax issue, has been covered in another discussion, so no need to comment there.
Where the goods are sent from is immaterial.... yes, as long as it's from within the EU. If not, a completely different issue.
As regards your being charged 4% VAT on books in Spain, when zero rated in the UK... interesting.
I wonder what would happen, lets say, if VAT on books was zero rated in Spain, and 10% in the UK ?
I bet you wouldn't get a 6% discount !

Posted on 12 May 2012 00:00:55 BDT
Last edited by the author on 12 May 2012 00:03:49 BDT
A Clarke says:
If a company's sales exceed a certain threshold, which varies from country to country, then the company must register for VAT in that country and charge their rate of VAT. If the company's sales are below the threshold then they charge VAT at the rate set by the country they are based in.

Posted on 12 May 2012 03:55:02 BDT
Correct..... My statement/question, goes a little deeper than the basics, ....thanks for your input.

Posted on 13 May 2012 08:01:33 BDT
Last edited by the author on 13 May 2012 11:46:56 BDT
Joan says:
On my latest order [edit: one order] I have just found out that I have paid Swedish VAT (25%) on top of the UK price which already includes the UK VAT of 20%. That is of course wrong...but so far I have not been able to get a refund from Amazon. I noticed they had charged me too much but first thought it was because they had failed to deduct the MAYDAY25 25% discount. Now I need to double check all my recent orders.

In reply to an earlier post on 13 May 2012 11:15:40 BDT
David Said.....I bet you wouldn't get a 6% discount !
Yes you would, Goods that have a list price for UK delivery have VAT at 20%, By the time I pay at checkout this has been adjusted to the 18% for Spain, therefore my 2% discount has been applied.

Posted on 13 May 2012 12:01:03 BDT
Last edited by the author on 13 May 2012 13:00:40 BDT
Joan says:
I have just learned the hard way that:

The UK VAT Rates for the following categories are 0%:

* Books
* Children's Clothing
* Children's Footwear
* Safety Equipment
* Grocery Items

Which makes everything I buy from these categories 25% more expensive when shipped to Sweden. Wonderful! Next time I will fly to the UK to buy clothing for my kid. Just the savings in VAT will pay the flight tickets.

In reply to an earlier post on 13 May 2012 14:19:56 BDT
Hi Johan,
What I mean is that Amazon are charging me Swedish VAT @ 25% on their goods sold, not 20% as in the UK.
Even with the higher VAT, right or wrong, their prices in my opinion, are still far lower than we pay in Sweden for most items, and I buy a lot on this site.
VAT in the UK, like Sweden, has different rates for different items. Amazon have a very good list, showing how items are rated in different countries.
I thought I'd throw this topic open for discussion, and see what others think.
As I say in my first statement, apart from this Vat issue, I am still VERY satisfied on the whole with Amazon.
I hope people keep coming with their opinions, but in the meantime, I have contacted HM Revenue & Customs,
explained the situation, and awaite their reply, which can take up to 15 days.
Greetings from a sunny Skane.

In reply to an earlier post on 13 May 2012 15:58:33 BDT
Hi Johan,
Another thing, that you maybe are not aware of.... Items sold by Amazon themselves, (not other companies),
can be shipped by "Super Saver" , when you spend 25 or more.This means free of charge.When going through the ordering process, you must amend method of shipment to super saver, which I think is a good deal !

In reply to an earlier post on 13 May 2012 16:10:41 BDT
Hi Lloyd,
Interesting... I didn't expect it would be so, even if it should be. I'll maybe have to be very humble after all this banter, and award Amazon a medal for good conduct... We'll see what the Gents at HM VAT have to say.

Posted on 14 May 2012 07:18:30 BDT
ixul says:
@David.A.R.Consitt: 1. The free of shipping charge is not for every country. 2. It is European rule that when a seller sells for over a certain total amount a year to a specific country (I don't know the correct amount) it has to charge the VAT of that country to its customers from that country. Your other sellers may sell less to Sweden. I for instance pay 15% VAT. However that rule changes in 2015 and then you pay the VAT of the country you are ordering from. Then you will win and I will loose.

In reply to an earlier post on 14 May 2012 17:56:28 BDT
Hi ixul,
Thanks for your comments, both being correct.
I've now found out, that my basic assumption was correct, but not being an expert, was unaware of your second point.... the "Threshhold" which you are referring to. I studied VAT Notice 725 paragraph 6:1 and more... then the penny dropped. Yes, most of the other companies I have purchased from are not on a large scale, so do not exceed the threshhold... and charge UK VAT rate. Amazon on the other hand,being a large company,will have exceeded this threshhold, and registered with Swedish VAT authorities, as they should. I look forward to 2015, mind you, as things are going, maybe the EU will look different.
As to your first point, yes I was aware of this, but as Johan is Swedish, it does apply, and may be of some help.
So, now I know the correct answer, I now know that what Amazon are doing re my VAT is correct, and rest my case ! thank you.

In reply to an earlier post on 14 May 2012 18:08:18 BDT
Response to Mr A Clarke.
I'm sorry, but I missunderstood your comments, which I now understand, and are quite correct.... see my latest
comments re: VAT 725... paragraph 6:1 , and more... I now know this is what you were referring to.
I've learnt a little more about VAT these past days... thanks for your comments.

Posted on 15 May 2012 10:07:54 BDT
When Amazon sells more than 100.000 euros worth of goods to another EU country they have to register in that country and charge the VAT for that country.

I think this is a fair system.

In reply to an earlier post on 15 May 2012 17:56:57 BDT
Hi Kristof,
From what I have read in HMRC documents, the threshhold amount varies from country to country, and is not fixed
as you state.
I don't think this system is fair, and as Ixul says, look forward to 2015.
Thanks for your input.

In reply to an earlier post on 15 May 2012 18:02:39 BDT
Last edited by the author on 15 May 2012 18:58:26 BDT
If you want it the old fashioned way, no free traffic of goods between EU countries and a maximum of 23 euro's free of importtaxes and VAT than yes that is way better. (not)

When you live in a certain country you have to support it by paying taxes and VAT in that country.

Sweden is one of the richest and best countries to live in, if you want that system to continue you have to pay taxes. When you want to avoid taxes then you'll have to move to another country but that's probably not an option because there are not many places better than Sweden...

This is the new EU VAT law:

http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2008:044:0011:0022:EN:PDF

And I have not found any news about changes in 2015 for not-digital products.

From 2015 digital downloads (iTunes, Amazon, softwaredownloads, ...) are charged with the VAT from the destination country. Now all big companies are located in Luxemburg for the low VAT rate on digital downloads. However this will change from 2015, because it undermines the system of taxes and VAT because e-services are becoming more and more important with a bigger salesnumber every year.

If what you and Ixul are telling would be correct that would cause big logistical problems for Amazon in Europe. It very often happens that a DVD box or book is shipped from France when I ordered it on the UK site, or when I order something in Italy it was send from Germany!! So from 2015 Amazon would have to ship the item from the country chosen by Amazon at the checkout. It will be impossible for them to change the country of shipping after placing the order, because the VAT rate is different in every country that Amazon operates in.

So again, I think you and Ixul are wrong about physical goods. The new rule only applies to digital services!

In reply to an earlier post on 15 May 2012 19:34:23 BDT
Hi again Kristof,
I posted my original comment/question, to see what was correct.To me it's no big deal, and I have learn't a little more than I knew before, and now know the answer to my question, that Amazon are quite correct in charging me 25% VAT when shipping goods to me in Sweden. So, no big deal !

I now find your comments straying from the original topic, and bordering on "offensive".

I am nearly 65 years old,and English by birth. I have been employed in the UK, Canada, USA and Sweden. I have also run my own businesses in the the UK, and Sweden too. In every country I have lived in, I have studied the culture, learnt the language where necessary, in some cases, helped by giving employment to people, paid my taxes, gladly contributing to the country I reside in. I have NEVER had a social handout from anyone, anywhere, and that includes Sweden, which I love.
So there you go young man, I don't need a lecture from you thank you !

Posted on 15 May 2012 19:41:49 BDT
I did not wanted to be offensive, but your comment "I don't think this system is fair, and as Ixul says, look forward to 2015." gave the impression that you were happy with a not existing regulation. You also did not explain why you don't think it is fair that buyers pay VAT in their country even when it is bought online from Amazon UK (FR, DE, IT, ...).

In reply to an earlier post on 15 May 2012 20:06:45 BDT
Hi Kristof,
Glad you did not mean to be offensive, thank you.
Quite honestly, I for my part, have discussed this issue sufficiently.
You are entitled to your opinion, as am I to mine.
MY opinion still is, that if I buy goods from the UK, (point of sale) then I should pay their rate of VAT, ie: 20%,
end of story... don't read deeper into the issue, it's not necessary.
Now, I'm tired, so I'm going to bed, I'm getting up at 04.00 hours tomorrow, go to work, and yes, I will of course, pay my taxes like a good boy, and contribute to the welfare of my country.
Thanks for the discussion Kristof, this has been an education... Good night.

Posted on 15 May 2012 21:14:30 BDT
ixul says:
Well if I am wrong with 2015, the better it is, at least for me, for tangible goods since I am living in Luxembourg. It is of course less good for my government's money and probably in the end for me. The government is already talking about increasing the VAT after 2015.
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Discussion in:  deals discussion forum
Participants:  8
Total posts:  24
Initial post:  10 May 2012
Latest post:  15 May 2012

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