A number of sellers are reporting that eBay seller VAT is being added at checkout.
The background to this is that as of the 1st of January eBay, and all other marketplaces, are obliged by law to collect VAT on sales under £135 from overseas sellers. There is no minimum amount and the intention is to increase the VAT take for the country from overseas sellers, some of who in the past might not have declared and correctly paid VAT on sales into the UK.
If you’re wondering if this is connected to Brexit the answer is that it’s not – The EU were also due to bring in similar VAT rules but due to the pandemic disruption this was pushed back to July, at which point eBay seller VAT will be added by eBay EU marketplaces from overseas sellers.
So, back to those based in the UK who are seeing eBay seller VAT added to sales and being collected from their buyers. This appears to be an error and eBay Customer Support appear to be aware of it. We’re hearing a fix is being worked on.
However, one eBay seller has found a solution which appears to work – simply edit your registered address on eBay (even if is already correct). When you make a change to your registered address, it’s likely that eBay will recommend the correct address in which case accept it. and eBay seller VAT will stop being added to your sales to UK buyers.
The really good news is that if you edit your registered address and VAT stops being collected on your listings it will apply to existing as well as future listings – you won’t need to relist everything and can carry on selling as per usual.
This will only work of course if you are a UK seller, if you’re registered overseas then VAT will be collected on sales and this is what is designed to happen. Editing your address should fix the issue for you, but hopefully eBay will fix the bug for those that haven’t spotted their buyers are being charged VAT.