Introduction

From 1 August 2024, Amazon will change the billing of all fees. This will have a significant impact on the application of the reverse charge procedure for Amazon sellers.

What is changing?

Until now, many Amazon fees were invoiced via Amazon's Luxembourg branch, which meant that the reverse charge procedure (Section 13b UStG) applied. From August 2024, however, Amazon will invoice via local branches in most countries where retailers are based. This means that fees to German Amazon merchants will be invoiced with German VAT in future.

Reverse charge procedure (§ 13b UStG)

The reverse charge procedure means that it is not the entrepreneur providing the service but the recipient of the service who is liable for VAT. This was previously the case for services such as advertising services, fulfilment fees and other e-commerce services.

Effects on Amazon retailers

• Local VAT: In future, Amazon retailers in Germany will be charged German VAT on their services, which they can deduct as input tax in their advance VAT return.
• Pan EU programme: Retailers who participate in the Pan EU programme will continue to be invoiced in two ways: both via the reverse charge procedure and via local VAT.

What do TAXWARE customers need to consider?

Thanks to our proprietary technology, which automatically integrates changes in legislation and legal assessments, our customers are well prepared for the transition. We will map the changeover securely and in good time in our systems.

Conclusion

The changeover to Amazon invoicing on 1 August 2024 will bring significant changes for Amazon merchants. Invoicing via local branches means that the reverse charge procedure will no longer apply in many cases. Retailers should prepare for this and, if necessary, consult their tax advisor to ensure that all new requirements are met.