listing prices suddenly increased by 20% with no warning on all my items / VAT margin scheme help
Summary: gemguarduk experienced an issue where eBay unexpectedly increased all their listing prices by 20%, affecting even those under the VAT margin scheme for second-hand collectibles. They sought advice, explaining that standard VAT applies only to new branded products and not to collectibles. 4_bathrooms suggested checking if VAT fields were left blank for applicable items, and noted eBay's ambiguous guidelines on margin schemes. papso22 affirmed that eBay's addition of VAT was incorrect according to HMRC. 4_bathrooms added that eBay might be misinterpreting its policy due to VAT obligations, which complicates the resolution process.
Hello I’m wondering if anyone has had any issues with this.
Yesterday without me changing anything or any warning from eBay ALL of my listing prices suddenly increased by exactly 20%
Yes I’m VAT registered and have a business account but my eBay account sells two types of products, one is branded products which I’m launching as we speak (yes standard 20% VAT applies here clearly and that has been done included in listing price)
Second are second hand collectible items - pokemon cards, here standard VAT clearly doesn’t apply, the VAT margin scheme applies where I calculate VAT from the profit margin of each item as they are second hand collectible goods
EBay uk guidelines also state that for VAT margin scheme sellers should leave the VAT field blank on listings which I have done, HMRC also clearly states that VAT margin scheme is used for these goods
Yet, eBay has randomly and suddenly applied standard 20% VAT on all my items without any explanation or warning
Has anyone had this issue before and successfully resolved it?
I’m now getting buyers asking why I randomly increased prices on all of my cards even though I didn’t and eBay just decided to do it themselves
Am I missing something? EBay guidelines literally make it clear what to do if you are a uk seller selling uk second hand collectible items using the VAT margin scheme
I’ve spoken to someone on the phone who said they basically just have to do what HMRC says, they told me to get a letter or email from HMRC to explain why eBay is wrong
I called HMRC and they said they can’t provide that because it’s literally just a public policy and told me to send eBay the VAT margin scheme policy …
I calculate VAT properly for all goods: standard VAT for new branded products, VAT margin scheme for second hand collectibles
Yet eBay decided to put standard VAT on ALL my listings for no apparently reason and it doesn’t even make sense according to their own written guidelines about margin scheme for UK sellers
daro2096
·1 month agoThis is common across everything. Its annoying.
4_bathrooms
·1 month ago · EditedThe cards you have listed as "New (other)" - are you leaving the VAT field blank on those items? I wouldn't consider something that is listed as "New (other)" to be used or "pre-owned" or whatever fluffy marketing term eBay applies to used items.
I can see eBay has also added VAT on to the cards that are listed as "pre-owned" but my best guess is eBay acted on the above. eBay defines "New (other)" as:
"New other (see details) A new and unused item with absolutely no signs of wear. The item may be missing its original packaging, or in its original packaging but not sealed. The item may be a factory second, or a new and unused item with defects. See the seller's listing for full details and description of any imperfections"
gemguarduk
OP1 month agoThanks for the reply, for the majority of my listings (graded cards) there is no condition option in terms of new/used etc the condition is just 'graded'
but yes it was a blanket +20% suddenly on all my listings, only a small handful are new and need standard VAT, the rest use margin scheme
the thing I'm trying to figure out is how eBay UK treats margin scheme sales, am I forced to put 20% VAT on all listings included in item price, and then when it comes to my tax returns not pay that full 20% but instead report the margin scheme rate?
Or is eBay supposed to allow me to put blank VAT for margin scheme goods and let me calculate it on my tax returns.
Have you had any experience with margin scheme on eBay UK as a VAT registered business?
papso22
·1 month agoHMRC says that your selling price for second hand margin scheme sales includes VAT, so ebay adding it is wrong.
gemguarduk
OP1 month agoYeah, I should be able to leave VAT blank and not have +20% standard vat auto applied by ebay
4_bathrooms
·1 month ago · EditedAh...hold on, this is what eBay states:
"About margin schemes
Business sellers are eligible to use the VAT margin schemes when they are selling the following products:
Second-hand goods
Works of art
Antiques
Collectors' items
However, under EU and UK rules, where eBay has VAT collection obligations, eBay cannot legally apply margin schemes for those products. Where eBay is obliged to collect VAT on these types of items, eBay will collect VAT on the full value at the appropriate rate to the items."
It sounds like eBay charges and remits the VAT under their own VAT number then remits the net sale amount to yourself.
I have no idea how you're supposed to account for that, though. Your price includes VAT but eBay is charging and remitting VAT on top of it.
gemguarduk
OP1 month agoyeah I read this too, the wording is quite ambiguous, it also states that margin scheme sellers can leave VAT blank
4_bathrooms
·1 month ago · EditedI agree it is ambiguous. I would have thought "where eBay has VAT collection obligations" would mean where overseas sellers/non-established taxable persons making supplies of such items was concerned. It could be that eBay are misinterpreting their own (badly written) policy.
The problem where eBay and VAT is concerned is HMRC holds eBay jointly and severally liable for the VAT obligations of its sellers. When eBay does something like this it is nigh-on impossible to make them see sense without providing some written confirmation from HMRC stating that eBay is wrong. The trouble is HMRC will rarely provide any such confirmation in writing and instead insist the seller takes the matter up directly with eBay.
If you look at a recent sale does it show a breakdown of the VAT stating the VAT was collected and remitted by eBay?