VAT declaration

[Lukas]

Hi,
I run a limited company and I've done a couple of sales through Amazon and Ebay. I'm about to declare my VAT return, however I'm completely new to accountancy which confuses me as I don't really know what to declare.
Do I have to declare the selling price with or without postage and with or without the amazon commission?
Many thanks for shedding some light on this matter.
Lukas

[robbob]

Hello Lukas

Vat is inherintly very technical unfortunately with very little being as simple as it should be.

Do I have to declare the selling price with or without postage

Generally I would say the full the selling price is normally what you charge vat on - postage presuming its part of the "deal" when the person buys the product follows the vat treatment of the goods being sold.

Note your actual postage costs are irrelvant - so whether you buy stamps with no vat or pay a courier who does charge you vat doesn't affect anythimng in the calcs
chapter and verse here.
https://www.gov.uk/guidance/vat-on-postage-delivery-and-direct-marketing-notice-70024

and with or without the amazon commission?

as mentioned above is the full sales price you delcare so if the sale price including vat and postage is £120 and amazon deduct £50 in their fees and pay £70 into your bank - you still account for the vat on the full sale £20 presuming its a standard rated item.

I am preusmig its a given that its your sale and not an amazon sale where they simply pay you commission.

I would highly recommend getting accountant on board now who can assist with early vat returns and year end accounts - they earn their bucks when you start up and the sign of a good accountant is that they will put in a little bit extra hard graft on your behalf when you most need it (now)

Note watch out for output you need to account for on services supplied to you by overseas firms - eg facebook - google adds (presuming its not google or facebook uk)- you need to account for output vat on payments to those busnesses and also claim matching input vat deduction - strange but true - although hopefully not true for too much longer

[Lukas]

Hi Robbob,
Many thanks for your crystal clear explanation.
Actually, this is exactly what I thought, I just wanted to get the confirmation from an expert
Just to recap, assuming that a breakdown from a sale on Amazon is as follow:

£39.90 is the price of an item sold on amazon; £6.90 is charged for the postage; 7.23 is taken by amazon as the commission.

If I got it right, I have to declare to HMRC £46.80. Which is the amount paid by the customer.
Can you please confirm?

[robbob]

If I got it right, I have to declare to HMRC £46.80. Which is the amount paid by the customer.

Yes that is correct - vat on that will be 1/6 = £7.80 presuming its standard rated item