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Changes to VAT on eBay Fees


From 1st August 2017, there are some changes to the way that eBay is structured which will have an impact on the VAT situation for UK businesses.

Instead of dealing with eBay Europe S.à r.l. based in Luxembourg, UK sellers will now have a contract with eBay (UK) Limited.  From a VAT perspective, this means that the reverse charge on EU services which was previously applied is no longer in place, and VAT will be charged from one UK company to another.

Implications on the different types of sellers are listed below.

Non-Business Sellers

Non-business sellers won’t see any change, other than that their invoice will come from a different company.  VAT was previously being charged on fees and will continue to be charged.

VAT Registered Business Sellers

VAT registered business sellers will now see VAT being added to their invoice where there was previously no charge.  In most situations this can be claimed back via the normal VAT return mechanism.  This will have an adverse impact on cash flow as the fees plus the new VAT charge will need to be paid before the VAT is reclaimed.

Non-VAT Registered Business Sellers

Non-VAT registered business sellers will also see VAT being added to their invoice, although as they are not VAT registered they won’t be able to claim it back and so will have an increased cost.


If you’re worried about how this change will affect you, or you would like to find out more about becoming VAT registered, contact us here.


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