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Is VAT collected on seller fees?

Depending on your business status and location, Etsy may be required to collect VAT on seller fees accrued each month and remit it to the relevant tax authority.

Etsy may also need to collect VAT on Etsy Payments processing fees for sellers located in eligible Etsy Payments countries where required.

Am I required to have a VAT ID?

A VAT Identification Number (VAT ID) is used to identify individual businesses for the collection of taxes. Etsy does not require sellers to have a VAT number to sell in our marketplace.

Businesses in certain countries may be required by their local tax authorities to register for a VAT ID if they reach their local country threshold. However, in some countries, you may also register for VAT even if you have not reached the threshold.

Because VAT laws vary from place to place, we’re unable to advise sellers on whether they need to acquire a VAT ID. If you have any questions about whether you need a VAT ID, please consult your local tax authority or tax advisor.

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How can I add or update my VAT ID?

You can add or update your VAT ID in Shop Manager:

On Etsy.com, click Shop Manager.

Click Finances.

Click VAT ID.

Enter your VAT ID.

Click Submit.

VAT IDs have specific formats and European VAT IDs can be checked on the European Commission website for validity.

If you notice that your VAT ID is coming up as invalid, you will need to contact your local tax department to have it updated. You may also have an obligation to register your VAT ID with your local government.

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How will Etsy use my VAT ID?

By providing a VAT ID to Etsy, you are establishing a business-to-business relationship between your shop and Etsy. This status and your business location determine whether or not Etsy will charge VAT on seller fees.

In some countries, Etsy has a reporting obligation to share your VAT ID, together with the total value of your seller fees applied for that period, with local authorities. Contact your local tax authorities for more information.

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Will I receive an invoice from Etsy for VAT on seller fees?

Etsy provides downloadable VAT invoices to sellers in Australia, the EU, India, Japan, New Zealand, Norway, Russia, South Africa, South Korea, and Switzerland.

VAT invoices will appear on the first of each month for the previous month’s statement.

Each monthly VAT invoice contains a summary of VAT-eligible fees (in USD) deducted in the previous month.

Prior to November 2018, fees on the invoices were based in United States Dollar (USD).

As of November 2018, fees on the invoices are based in the currency of your Payment account, in some cases may still be USD.

Monthly VAT invoices arrive as downloadable PDF in English.

You can access the invoice on your desktop computer by visiting Shop Manager > Finances > Payment account. Once there, click on the month to get an invoice for that period. The download link will appear above the breakdown of your activity for the month.

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VAT for shops based in Australia, Belarus, the EU (excluding Ireland), Iceland, India, New Zealand, Norway, Québec (Canada), Serbia, South Korea, Turkey, Taiwan, and United Arab Emirates

For sellers in these countries who have not submitted a VAT ID to Etsy, applicable VAT charges will appear in the current balance in your Payment account. You’ll receive a monthly invoice on the first of the following month that includes a list of VAT-eligible seller fees and how much you were charged on those fees during the prior month.

If you added your VAT ID to your Etsy account, you won’t be charged. Instead, you will receive an invoice from Etsy on the first of each month stating that you were not charged VAT on your seller fees. You’ll have access to invoices starting with the month you added a VAT ID to your account.

If you received a VAT credit during a month for a charge that was in a previous month, you will also receive a credit note along with your invoice on the first of the month. For example, if you sell a listing in June, and then cancel the order in July, the VAT you were charged in June and refunded in July will be reflected in the credit note issued for July’s transactions.

Some areas are exempt from VAT. We are aware of these exceptions and are working on a solution for sellers in these locations.

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VAT for shops based in Ireland, Japan, South Africa, Russia, and Switzerland

Etsy is required to charge VAT on applicable fees regardless of whether you’ve submitted a VAT ID to us. Your Payment account will reflect any charges from the previous month. You will also receive a monthly invoice on the first of the month that includes a list of VAT-eligible seller fees and how much you were charged on those fees during the prior month.

If you received a VAT credit during a month for a charge that took place in a previous month, you will also receive a VAT credit note along with your invoice on the first of the month. For example, if you sell a listing in June, and then cancel the order in July, the VAT you were charged in June and refunded in July will be reflected in the credit note issued for July’s transactions.

You can find the current VAT rate for Irish sellers here.

Visit for more information: https://www.etsy.com/shop/fashionbee66

 

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