The UK has now left the EU’s Customs Union and the EU VAT regime. Despite all the negativity and confusion surrounding it, post-Brexit cross-border ecommerce presents a great opportunity for marketplace sellers on both sides of the English Channel and beyond.
We have spent weeks analyzing the listings of our European sellers selling to the UK. To help you boost your sales on the UK market even further, we have introduced a small change to how the VAT appears on your listings on eBay.co.uk.
The change should not affect your standard workflows!
Additionally, in line with the EU regulation, you will have to add rates to your domestic listing.
Below is some more information for you.
Why the change?
We introduced the change to avoid the products sold by our German sellers becoming less competitive on the UK and international markets.
What are the results?
Sellers who had the change in VAT settings introduced have seen their GMV almost doubling in comparison to the weeks before the change.
What is the change?
For German sellers who have provided domestic VAT information on their domestic listing, we show their localized listing in various ways:
UK buyer purchasing from the eBay.co.uk site:
- Transactions over £135, Webinterpret will list your items with the net price. VAT is paid at customs.
- Transactions below £135, WebInterpret will also list your items with the net price. However, in this case eBay will add the VAT and will display it at checkout.
Buyers based outside of the EU:
Webinterpret will also display net prices, but if the buyer chooses a destination address outside of the UK, missing VAT will be visible in the checkout. Webinterpret will add the missing VAT to the shipping cost in these cases.
Do I need to do anything?
To help us make your listings more competitive on eBay.co.uk and other international sites, we strongly encourage all German sellers to provide domestic VAT information for all their domestic listings/products. Otherwise, Webinterpret is not able to calculate the net price.
From 1 July 2021, in line with the EU regulations, you will have to always provide the gross price and the VAT rate you used to calculate the gross price on your domestic listings.
The new VAT setting affects the listings for:
We have introduced the improved VAT settings for all German sellers, to help them become more competitive in the UK and other international markets.
UK buyer purchasing from the eBay.co.uk site
Will see the NET prices. The VAT will only be applied at the checkout if the order value is lower or equal to 135 GBP.
Buyers based outside of the EU, whether purchasing from ebay.co.uk or other sites
We show the listing with a product net price. The VAT is then added to the shipping costs. It will only be visible at the checkout.
What if there are shipping limits?
Certain categories do have shipping price limits. In that case, Webinterpret lists on international markets with the maximum possible shipping price. The exceeding amount will be added to the item price.
For instance, if the VAT value amount is 30 EUR. But the shipping cost limit is 15 EUR, and shipping costs to GB is 5 EUR.
We would add 10 EUR VAT to the shipping costs (5+10=15), and the remaining amount of 20 EUR (30-10=20) we would add to the item price.
What is the background behind the change?
From January 1, 2021, eBay is obliged to collect and remit VAT within the UK up to an order value of 135 GBP. eBay only accepts UK VAT values or values higher than the UK standard VAT of 20%.
This might make the products sold from German less competitive in the case when the German seller does not specify the VAT value on their domestic listing and eBay applies another 20% on top of the item price which includes already the 19% domestic VAT (only in case of order values up to135 GBP).