Introduction.
Cross-border e-commerce (E-commerce) has been expanding worldwide with Amazon, eBay, Rakuten, Shopify, WooCommerce, and Corona Vortex, and is now the focus of attention by all companies. Cross-border e-commerce has been introduced with the positive aspects of being able to start selling within minutes of creating a site, and new sales opportunities from markets around the world. On the other hand, local taxes and various other costs are not shared much: local taxes such as VAT are levied and collected by the seller on the local buyer, but even in the case of cross-border e-commerce, there are cases of taxation, collection, and reporting.
Not all tax accountants, lawyers, and other domestic professionals have knowledge of overseas tax and legal affairs.
IN THIS COLUMN, OPTI CORPORATION, WHICH HAS EXTENSIVE EXPERIENCE IN THE TAX ASPECTS OF CROSS-BORDER EC, PROVIDES A "CROSS-BORDER EC TAX NAVIGATOR" IN A Q&A FORMAT. WE HOPE THAT THIS CROSS-BORDER EC TAX NAVIGATOR WILL BE OF HELP TO VARIOUS COMPANIES CONSIDERING CROSS-BORDER EC.
Q] I will be selling to the EU through Amazon FBA. In this case, in which country should I register for VAT and file a VAT return?
A] AT A MINIMUM, VAT REGISTRATION AND VAT DECLARATION IN THE COUNTRY WHERE THE FBA IS LOCATED IS REQUIRED.
When selling goods on Amazon Europe, there are two ways to sell goods: using FBA or sending goods directly from Japan.
In this section, we will explain the taxation when using FBA.
Fulfillment by Amazon ( FBA ) is a program where Amazon receives orders and ships products on behalf of sellers. Sellers deliver products to the Amazon fulfillment center, store the delivered products in the Amazon distribution center, and then ship the products according to customer orders.
For FBA services, you must register for VAT in the country where you hold your inventory in the FBA warehouse. This is because the goods are imported at the warehouse location. (In addition, online marketplaces are obligated to collect VAT on goods sales, so Amazon is not obligated to declare VAT on sales.)
Disclaimer
This column contains general information only and is intended to be used at the reader's own risk. While every effort is made to improve the accuracy of the information, it may contain inaccuracies. Readers should consult a suitably qualified professional before making any decision or taking any action and assume the entire risk and responsibility for any loss arising from the use of this column.
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