amazon.com is one of the largest electronic marketplaces worldwide. An increasing number of online retailers from Germany are therefore also selling their products there.
One challenge is the recording of these transactions for VAT and accounting purposes, which has often been done incorrectly and involves high risks.
Powered by Taxdoo, Amainvoice, the invoicing tool often used by pure Amazontraders, will soon be able to correctly display these transactions.
Fulfillment by amazon.com
Comparable to Europe, the USA also offers Amazon fulfillment, so that a retailer from Germany does not need its own logistics structure in the USA.
The goods are transferred from Germany to the USA and distributed to local fulfillment centers, from where they are sold and delivered to customers in the USA who purchase the goods via amazon.com.
This raises two questions.
Question 1: How should local sales in the USA be recorded for VAT and accounting purposes?
From a German perspective, local sales in the USA are not taxable, so that there are none Value Added Tax in Germany.
The question whether a supply is taxable in Germany also depends on whether the place of supply is in Germany.
Since the deliveries to be assessed are sales from local warehouses in the USA to customers in the USA, the legal consequence is that these are non-taxable sales in Germany.
These transactions must be recorded in the accounts in the appropriate accounts - non-taxable transactions.
Question 2: How should the previous transfers from Germany to the USA be recorded for VAT and accounting purposes?
This question is a bit tricky. Within the framework of Amazon Pan EU, many people are familiar with the VAT construct of intra-community transfers when Amazon goods are transferred to another EU country.
Under Pan EU, traders must declare fictitious supplies to themselves for VAT purposes. The system is explained in detail here.
The most important thing first: there are no shipments to third countries, such as the USA.
From a sales tax perspective, there is no taxable turnover in this case. There is no corresponding transaction to be posted in Financial Accounting either.
The transfer of the goods should be documented by means of so-called "exit notes". This can be an electronic record via ATLAS or a bill of lading.
Note: If you want to know more about export deliveries and exit notes, register for our webinar, which we will be holding shortly together with auditor Andrea Köchling (in a non-official capacity). Click here for registration and later for recording.
Regular errors of many software solutions
Caution is advised with numerous software solutions on the market. Many systems post both the sales in the USA together with the transfer of the goods there as tax-free export deliveries.
This is wrong, as we have explained above, and will sooner or later lead to extensive enquiries from the tax authorities.
In addition, this also leads to distortions in the business analysis (BWA), so that your proceeds and possibly also profits would be too high in case of doubt.
One supplier that is now aware of this problem and intends to adapt the system shortly is Amainvoice.
Amazon.com about Amainvoice - powered by Taxdoo
Here you can see a short correspondence about Amainvoice with the promise of the management to no longer record transactions related to amazon.com as export deliveries for VAT and accounting purposes.
Supplement: Amainvoice has meanwhile also been informed that the transfer of the goods to the USA does not constitute an export delivery, as was announced in the mail - see question 2 above.
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