New UK Company Laws Are GAME CHANGING for Amazon Sellers! (Amazon FBA UK 2024)
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- čas přidán 4. 08. 2024
- From March 4th 2024, UK company law is CHANGING and it could have a BIG impact on Amazon FBA sellers! For years, Amazon sellers in the UK have faced unfair competition from Chinese sellers who have relied on low prices to capture sales. Part of this competitive pricing advantage has been as a result of some Chinese sellers avoiding their VAT obligations which has given them a 20% margin over law abiding UK sellers.
The UK government has tried to deal with this issue in the past, following VAT rule changes at the beginning of 2021 Online Market Places (OMPs) such as Amazon became responsible for collecting VAT on behalf of foreign sellers.
Unfortunately, Chinese sellers were able to get around this new restriction by registering for VAT with a UK address. This meant that Amazon would continue to collect and pay the VAT to the Chinese sellers who then wouldn't declare it or pay it to the HMRC.
Chinese sellers know they are extremely unlikely to face any repercussions as the UK government is powerless to take action against sellers outside the UK.
Thankfully, there are new UK company law changes coming that will make it much harder for foreign sellers to set up businesses in the UK.
These new law changes will help prevent sellers from using fake business addresses and it will also introduce a verification step which will make it even trickier for foreign sellers to set up a company in the UK.
Amazon FBA beginners in the UK have nothing to fear from these changes, however, it is worth noting that fees will be going up to cover the additional resources.
Now could be a great time to start an Amazon FBA business and start selling on Amazon as the playing field becomes more level than ever.
Starting Amazon FBA in 2024? Let us know how you are getting on in the comments below! !
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Thankyou!! It was really hard to compete with them!!
Thank you.
i understand the logic of this new rules... but I rent my apartment so I use a PO box to protect my privacy and renting an office space is an additional expense on top of the new vat. for a smaller seller like me who did not hit the threshold for VAT all of these new requirements are enough to "put me out of business" while the chinese sellers who sell way more can still work around the system or pay a "uk representative" to act as the seller.
Would anything stop CN sellers just using a virtual office address? (one that receives and scans mail)
But the example you showed wasn't using a P.O. Box address, so it is hard to see the impact for that dog brush seller.
Personally think it’s all a show & will still hardly be enforced & they will soon find ways around it - wouldn’t it be better to just ban them if they’re not paying any vat. Surely it be obvious with those vat numbers not receiving anything or very low amounts?
It's about time, I hope they do this in US too. I hope they don't even allow them to sell if they're outside US
Dear Sir, the new 20% VAT tax imposed on UK Amazon, is that tax on your total sales volume or total profit or total FBA fees? If it is on sales then prices of selling products on amazon should be increased, which is not. So the profit margin will become zero or negative?
Hi Do you have any tutorial for uk seller hoping to sell on amazon usa
Not only chineese but v pakistanis have also been asked to pay 20% vat which v never collected from.customers nor did amazon asked us to collect n pay vat. Now recently in 2024 amazon started pushing us for paying vat 20%. Fact of the matter is two pronged v never earned profit of 20 % nor v collected it. Amazon should have made it clear right at the time of registering us with them in 2021. Now asking us to pay 20% after 3 years is unjust n time barred. I hope someone look at this issue.
well I would prefer cheaper items smh.