EU VAT Registration Made Simple for Online Sellers
Expanding your business internationally is a significant milestone—and Europe is a promising region to target. To increase your chances of success, it’s crucial to understand compliance requirements, taxation, and regulations—particularly UK and EU VAT. But what exactly is VAT, and how can you prepare for it?
In this guide, we’ll cover the essentials of European VAT, including when and how to register, and how Amazon can assist in the process.
What is European VAT?
VAT, or “value-added tax,” is a consumption tax applied to goods and services throughout the production and distribution stages in Europe and other regions. The VAT amount is generally calculated by adding the value of your products to any applicable customs duties, shipping costs, and insurance charges—often totaling around 20% of the shipment’s value.
When selling in Europe, you may need to register for VAT under either the Standard Rate or Flat Rate (the Flat Rate option is available only to UK sellers). With the Standard Rate, Import VAT can be reclaimed. If you operate in multiple European countries, you’ll likely need to register for VAT in each one.
Using Marketplace Product Guidance for Global Growth
If you’re considering expanding globally, the Marketplace Product Guidance tool can help you identify high-demand products and assess their potential performance in various markets. This tool provides valuable insights into customer preferences, competition levels, and category trends—making it easier to decide which countries and products to focus on.
When to Register for VAT in the UK or EU
Once you’ve set up a Professional selling account for Europe and identified your target products, the next step is to review the VAT requirements for the regions you plan to sell in.
If your annual sales remain below the threshold for a specific EU country, you may not need to register for VAT. However, as soon as your sales exceed that threshold, VAT registration becomes mandatory in that country.
Additionally, if you plan to use Pan-European FBA for storing and shipping your products, VAT registration is required before selling to European customers. You might also need to file VAT returns in the countries where your products are stored or shipped—especially if you cross the “distance selling” threshold. For personalized guidance, it’s best to consult a qualified tax advisor.
How Pan-European FBA Supports Expansion
Amazon’s Pan-European FBA program streamlines order fulfillment across the EU, allowing you to concentrate on growing your business. If you’re already using FBA on Amazon.com, you can join the Global Selling program to expand into Europe. By setting up a Europe selling account, listing your products, and sending inventory to European fulfillment centers, you can start serving customers throughout the region.
How to Register for VAT
Registering for VAT is usually straightforward and free. Most European countries offer online registration, often with English-language resources. Depending on the country, you may be able to complete the process via an online form or a downloadable PDF.
After submitting your application, you might receive additional forms to sign and return. Keep in mind that VAT registration may involve other compliance obligations, such as filing reports or issuing VAT-compliant invoices. In the UK, you can begin the process through the gov.uk website.
Amazon’s Role in VAT Registration
If you’re unfamiliar with the VAT process or plan to operate in several European countries, working with experienced tax or regulatory advisors is recommended. Amazon’s Service Provider Network connects sellers with vetted third-party professionals who can guide you through VAT registration, compliance, and other aspects of selling in Europe.
These advisors can help you understand country-specific rules, handle registration paperwork, and ensure your business meets all regulatory requirements before launching.
Adding Your VAT Registration Number to Amazon
To provide Amazon with your VAT registration number, log in to your Europe Seller Central account. From the Settings menu, select Account Info, then go to Tax Information. Under VAT/GST Registration Numbers, enter your VAT numbers for each registered country.
It’s important to keep your VAT details accurate and up to date. Incorrect information could result in miscalculated VAT charges, potentially costing your business more. Some European regulations also require Amazon to hold your local VAT registration number if you store inventory in that country or surpass certain sales thresholds.
Final Thoughts
Registering for VAT is a key step toward expanding your e-commerce business into Europe. Even if your business operates across multiple countries, Amazon offers tools and support to make the process more manageable. With proper planning, accurate documentation, and the right guidance, you can meet VAT requirements and successfully grow your presence in European markets.
