On a routine check by one of our accountants we discovered that reports issued by Amazon were faulty. B2B transactions did not include the Buyer VAT ID, and as this is a mandatory legal requirement for these kind of transactions we couldn't file your reports. We contacted Amazon with the hope they will fix these transactions, but we did not get any response yet. We tried to answer the most important questions about this matter below:
In what time period did this error occur?
As far as we know, this issue occurred mainly in July 2019.
How to spot the affected transaction?
Download the VAT Transaction Reports from the last 3 months (Reports→FBA→VAT Transaction Report) from Sellercentral and filter by "VAT Rate: 0%". Or download the VAT Report from your account (Menu→Files and Reports).
What is the reason of this error?
The cause is not known yet. There is no special characteristic that may explain why some transactions are affected and others are not.
How will my transactions change?
B2B sales without Buyer VAT ID will be reported as B2C sales. We will use the reported GROSS value and calculate the NET value based on this. The VAT rate will be taken from your products VAT rate in your account (standard or reduced). The VAT country may change to the destination country, based on your opt-out and threshold rules.
For B2C Sales with 0% VAT Rate, we will change the VAT rate in your account accordingly (standard or reduced).
Why can't you file the transactions with 0% VAT Rate?
By law, a B2B sale has to include a valid (buyer) VAT ID that we need to include inside the VAT and EC Returns. Reports that include 0% transactions cannot be submitted. This is why some of your reports were not filed by now.
Who covers the penalty for late submission?
Governments do not accept excuses for such cases. They may issue a penalty for late filing to you. You may try to hold Amazon liable for them. Please note: There is no contractual relation between hellotax and Amazon. We are unable to support you to solve the problem with Amazon.
Who is responsible?
Amazon takes no legal responsibility for tax related problems, and both of us are limited to the data we receive. In this sense you are limited to the decisions of Amazon.
How to reclaim the VAT paid on B2B Sales (we converted into B2C sales)?
If Amazon fixes the error for past transactions (e.g. providing a Buyer VAT ID or correct VAT Rate), you can report it to us and we will import your latest reports to file an amendment.
What if Amazon is not replying to me and the error continues to stay?
Paying VAT on B2B sales can harm your cash flow and is not a long term solution. By law, it is mandatory to report those sales with VAT. We are not allowed to exclude them or file NIL returns. If this error persists, we have to discuss an individual solution.
Are other services affected?
Most likely yes. If you use an external invoicing or accounting software, make sure to check it and contact the service provider in case of similar problems or uncertainties.