Amazon have started to collect VAT in more European countries. Residents of Norway, Switzerland and Armenia will all be charged VAT from the 1st of January 2020.
The change is due to the countries starting to requiring non-resident companies providing remote services to begin collecting VAT on these services when they are provided to Norwegian residents or persons who are not registered for VAT. Amazon is classed as a non-resident company and selling on Amazon is classed as a remote service hence the requirement for Amazon to start to collect VAT. You should expect to see this occur in many more countries around the world as tax authorities increasingly focus on the digital world and attempt to tax the online world fairly.
Amazon will collect VAT when residents incur selling on Amazon fees in these countries if they are not registered for VAT. Unless a seller has provided Amazon with their VAT number as evidence that are VAT registered in the applicable country, new tax legislation requires Amazon to collect and remit VAT at a standard rate on Selling on Amazon fees paid by sellers.
The VAT rates are 25% in Norway, 7.7% in Switzerland, and 20% in Armenia.
How to register your VAT number with Amazon
To provide Amazon with your VAT ID:
- Log into Seller Central.
- Under Settings, click Account Info.
- In the section Tax Information, click VAT information.
- From the list of countries, select your country of residence.
- Type your VAT ID.
- Click I accept and acknowledge all conditions set out in the Tax registration agreement.
- Click Save.