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This article applies to selling in: Germany

Filings Reporting Methodology

Opting to tax in the destination country

To be able to automate your VAT calculations and VAT reporting, both VAT Calculation Services (VCS) and VAT Services on Amazon are making an assumption that you need to be aware of before you enroll in these programs. Both VCS and VAT Services on Amazon will perform your VAT calculations based on an assumption that you have opted to tax your transactions in the country of arrival of your shipments from the moment you have a validated VAT number for that country in your Seller Central account. This implies that a cross-border EU sale of goods to consumers (distance sales) will always be taxed in the country of arrival of the shipment if a valid VAT number for that country is available.

The general VAT rules that apply to distance sales state that these sales are taxed in the EU country of dispatch of the shipment as long as you have not reached a certain threshold of distance sales to a specific EU country (ship-to). However, taxpayers can also opt to tax their distance sales immediately in the arrival country, by submitting a declaration to the tax authorities in the country of dispatch of the shipment that you are opting out of the distance sales regime. A similar declaration should also be submitted in the country of arrival of the shipment, to notify the tax authorities of the change in tax treatment.

For any VAT registration numbers that you receive through VAT Services on Amazon, your tax agent will submit the opt-out declaration with the registration application so that transactions can be taxed in the country of arrival of the shipment from the date that your VAT number was requested.

Note: Your tax agent will only submit these declarations for your VAT Services on Amazon filing countries. If your country of company registration is an EU country, you will need to submit the declarations in this country so that sales shipped from your country of company registration can be taxed in the country of arrival of the shipment in line with the above methodology.

If you have any additional questions in this respect, such as how and when to inform the tax authorities, we recommend that you contact your independent tax advisor. If you do not have a tax advisor, refer to this page, which contains a list of tax advisors who provide preferential rates to Amazon sellers.

Adding VAT numbers to Seller Central

To ensure that your transactions are taxed correctly, you should ensure that you update your VAT numbers in Seller Central as soon as they are received.

Awaiting VAT Registration Number

If you have applied for a VAT registration in one of your VAT Services on Amazon filing countries but you have not yet received the details of the VAT registration number, then you will see VAT_APPLIED in the place of the VAT registration number. This is to ensure that your VAT liability can be accrued and reported according to the VAT Services on Amazon taxation methodology once you receive your VAT registration number and can submit your VAT filings. Learn more about the VAT Services on Amazon taxation methodology here.

Default Product Tax Codes (PTC)

A Product Tax Code (PTC) is an Amazon-defined code that has the correct set of VAT rates across the EU for a specific product category. As a default, the PTC "A_GEN_STANDARD" will be set for all products. This PTC applies the standard rate of VAT in all taxable jurisdictions.

Both VAT Calculation Service and VAT Services on Amazon use the PTC to determine the appropriate VAT rate to apply to sales and refunds of your products.

This help page on Seller Central contains a list of the VAT rates for each country in the EU, as well as a list of all valid PTCs that you can assign to your product listing. We would kindly invite you to assign the relevant PTC to your products, based on the category applicable.

If your products do not fall into any of the categories of PTCs on the list or are not usually subject to a reduced rate of VAT, you are able to leave the PTC field blank. This is because the default PTC that will be applied is "A_GEN_STANDARD", which is used for products that are always subject to the standard rate of VAT. This PTC covers most products that are sold on Amazon, Default postcodes and weight.

In order to complete your Intrastat returns, a valid postcode is required for the final destination of the goods in the arrival country (ship-to). Where the postcode of the arrival destination is unavailable for any reason, such as when a transaction relates to a past transaction and the original arrival postcode is no longer available, we will automatically report the postcode as the postcode of the capital city within the arrival country.

Similarly, the weight of any items shipped in a cross-border EU sale of goods is also required to complete your Intrastat returns. This weight will be automatically populated in the AVTR according to details stored in your product tax file. When this information is not available, the weight will default to 1.

Note: When a postcode or weight is set to a default value, it is only relevant for the purpose of completing the Intrastat return and does not impact on the amount of VAT reported in the VAT return. If you have any additional questions in this respect, we recommend that you contact your tax agent.

Amazon movements reporting with arrival date as tax point

An EU cross-border transfer of own goods is a single logistics transaction with two potentially taxable events from an EU VAT perspective: the first is the (deemed) intra-EU supply of goods in the country of departure and the second is the (deemed) intra-EU acquisition of goods in the country of destination. For EU VAT reporting purposes, the best practice is to report these two events in the same month on the VAT and Intrastat returns in both countries. We facilitate this by reporting the INBOUND and FC_TRANSFER transactions in your AVTR based on the date that the goods arrive in the country of destination. Note that you might need to review your internal processes for these transactions to assess whether any changes are required to align with the AVTR reporting.

Proportional weighting related

For your Amazon FC transfers and AFN Inbound transactions, VAT amounts need to be computed to be reported in VAT returns. This, however, is a net zero computation and does not impact your net VAT liability. This calculation is based on the VAT rate that is applicable to your sales for those products in the respective country.

Returns elsewhere?

In some circumstances, it may be possible that your goods are returned by the purchaser to a different country than the one in which the goods were initially shipped. In addition to any adjustments that are required to be made to your VAT returns, in accordance with the position of the EU VAT Committee, we will treat the movement of the goods from the departure country to the country where the goods are returned as an EU cross-border movement of own goods for EU VAT reporting purposes.

This means that no movement of the returned goods is required to be reported in the arrival country of the original sale (in effect, it can be ignored), and only two taxable events occur from an EU VAT perspective: The first is the (deemed) intra-EU supply of goods in the departure country of the sale, and the second is the (deemed) intra-EU acquisition of goods in the country to which the goods have been returned.

Transactions which are excluded from VAT Services on Amazon

For each month that you process transactions on Amazon, there may be some transactions which do not have any impact on your VAT filings, or which are missing required data elements for VAT reporting in the countries where you are subscribed for VAT Services on Amazon. Amazon will produce two separate versions of the AMAZON VAT TRANSACTION REPORT (“AVTR”): 1) a full AVTR which contains all Amazon transactions for the relevant period and is available in the FBA Reports page on Seller Central; and 2) a condensed version of the AVTR that is used for purposes of your VAT return filings via VAT Services on Amazon. The condensed AVTR contains only those Amazon transactions that are necessary, and for which you have provided sufficient information, to accurately prepare your VAT filings in your VAT Services on Amazon subscribed countries. The condensed AVTR is available within the VAT Services on Amazon page in Seller Central. Transactions may be excluded from the condensed AVTR for the following reasons:

Sale & Refund Transactions

Any Amazon sale or refund transactions processed through VCS that do not relate to your VAT Services on Amazon subscribed countries, or fall outside of the relevant reporting period, will be excluded from the VAT Services on Amazon AMAZON VAT TRANSACTION REPORT because they will not have any impact on your VAT filings.

INBOUND & FC_TRANSFER Transactions

In some cases, Amazon will exclude INBOUND and FC_TRANSFER transactions from the condensed version of the AVTR if you have not provided a validated VAT number for the departure country or arrival country in your Seller Central account. This is because your VAT number for both countries is required in order to report the cross-border transfer of own goods accurately on your VAT filings. Carefully review both the full and condensed versions of the AVTR to identify any INBOUND or FC_TRANSFER transactions that have been excluded from the condensed AVTR.

If you have INBOUND or FC_TRANSFER transactions excluded from the condensed AVTR because you do not have validated VAT numbers for the departure and arrival countries of the inventory reflected in Seller Central, check your Fulfillment By Amazon settings to ensure that you have not enabled the use of Amazon fulfillment centers in countries where you are not registered for VAT.

Once you have reviewed and, if required, corrected your settings, contact your tax agent to discuss the transactions in order to determine whether any further action is required. This could for example be uploading the transactions again through the Additional VAT Report and adding the missing VAT number(s).
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