Hi there
I am looking for some help with my first self assessment. I am a sole trader based in the UK with a UTR number registered with HMRC. I started trading on Amazon using solely the FBA service in 2017. I have no other income streams besides Amazon FBA.
So I have some long and winding questions but I believe the answer is pretty straight forward for people here. I know most of you will be unfamiliar with Amazon so I will try to break it down.
Question 1. In order to gauge income from sales and expenses, Amazon has a business report function where you can see these 2 figures for the tax year (April 6th 2017 to April 5th 2018). The expenses column covers selling, shipping and subscription fees for using the Amazon platform. I believe I can declare these as expenses to HMRC because each month Amazon emails VAT invoices with these figures and others seem to use them.
So what I have been doing to get figures for HMRC is totalling the income from Amazon sales minus Amazon expenses. Once I have that number, I subtract it from the cost of buying products purchased in that tax year. The number left is my actual "profit" and this is what HMRC is ultimately looking at? I know this isn't exactly a professional way but is it a pretty solid way to operate for a sole trader?
Question 2: Amazon is primarily for UK based sales but they also allow you to sell to customers in France, Germany, Italy and Spain. I use distance selling to these customers (stock stored in UK) and are well below the threshold to register in the respective countries.
What my real question is, do I also declare these other country sales to HMRC? I am guessing I do but what is confusing me is what happens if I actually do go over the threshold in say Italy? I would be declaring similar expenses to both HMRC for my Italian sales as well as the Italian equivalent. Is that normal? Just seems weird to me but I am a noobie I guess! Also on a smaller note, since other country sales are in Euros, do I use a currency converter to GBP before giving the details to HMRC? Obviously the conversion rate changes daily so I am puzzled on that aspect.
I know this was a long and winding path but if anyone can shed some light on this I would be grateful.
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