I have a client whose turnover has gone over the VAT threshold, and so I have got them registered. They make a fare few business purchases from Amazon and through Paypal.
Now that they are VAT registered, I am obviously keen to make sure they claim back all the VAT they are allowed from their purchases. However, my client is struggling to get proper VAT invoices for the purchases he has made through Amazon and via Paypal. He is very organised, and prints off all the paperwork he gets for each purchase. Some of the receipts clearly say 'this is not a VAT invoice', some clearly split the net, VAT and total paid out, so not a problem, but most of them seem to just show a 'Total Value', Delivery Amount , and 'Amount Paid'.
I was always taught that unless the receipt is for a 'VATable' supply, and shows a VAT number, you should not claim the VAT back.
Just wondered what others do with Amazon invoices that do not clearly indicate if VAT has been charged? Do you just assume that the business making the sale must be small, and not VAT registered, so don't claim it?
if it is under £250 and they have the Vat number on the receipt it is acceptable to claim the Vat back, over this amount it must show a break down of the Vat
If the receipts don't have the Vat number on I would say don't claim anything as you will not know if they are registered or not
You can get VAT invoices from Amazon, as long as it was fulfilled by Amazon.
From memory you can go back a year, anything older, then you have to send an email to a specific email address, with the references of your purchases, and they will email pdf copies.
All your client has to do is go in to their Amazon account, select the item, then order details (link at top right), there is then an invoice option. If no invoice option appears, it may be too old, or not fulfilled by Amazon.
Anything not fulfilled by Amazon you have to contact the seller direct (Be aware that many of them are not UK based, so any VAT is not claimable).
The same with PayPal, they only act as the collector of payment. You need to contact the seller direct.
I have a client whose turnover has gone over the VAT threshold, and so I have got them registered. They make a fare few business purchases from Amazon and through Paypal.
Paypal just provides a service which, in effect, makes them a payment gateway - so that, for example, the customers of people selling tat on eBay, or people selling stuff from their own websites, can pay by credit card even though the person (or company) selling isn't able to take plastic. As such, your client doesn't make any purchases "through" Paypal - they simply pay using it. (AFAIK, anyway - unless Paypal have changed recently and now have an only shop.)
In the seller preferences, I can see there is an option for setting up VAT rates* so I presume the idea is that if a seller is VAT registered, they should set this up and it will be shown on the receipt Paypal sends out to buyers. A receipt that doesn't show VAT, therefore, is probably a purchase from someone who isn't VAT registered.
There is no harm in your client contacting sellers, after making a purchase where the Paypal receipt doesn't show VAT, and asking for a proper VAT receipt if the seller is VAT registered. (If they are, they are legally obliged to provide a VAT receipt if asked for one by a VAT registered customer).
Amazon, on the other hand, is a nightmare. When making purchases through Amazon your client is effectively playing a VAT lottery.
Amazon sell stuff themselves, which is fulfilled by them. They also sell stuff themselves, which is fulfilled by others - and they also provide the Amazon marketplace, whereby they provide the online shopfront for others to sell stuff, and they handle payment. And I think there are other 'subtle' variations, which are probably all a part of Amazon's ongoing tax avoidence strategies.
With some things on Amazon, it's clearly shown if there is VAT - in which case, a VAT receipt is probably issued, though I wouldn't swear to it.
With the marketplace, though, you don't really know if there is any VAT on anything you purchase until after you've purchased it and have received the item, with a VAT receipt in the package.
If it is supplied without the VAT receipt, it could be because the seller isn't VAT registered, or it could be because they didn't bother including one. The only way to find out is to contact the seller, though Amazon, and request one - be prepared for slightly inconsistent instructions from Amazon on how to do this (I've followed their instructions and they've worked, and I've followed them and discovered the various steps are sometimes wrong; all tied in with those subtle variations, I think.)
My general advice to people when it comes to Amazon is to only bother with them if the difference between their price and the next cheapest (on which you know there is VAT and will get a suitable receipt) is at least equal to the VAT.
My logic is that I'd rather pay £12.00 to A.N.Other and know I'll be able to reclaim £2.00 VAT, making the net cost to me £10, than pay Amazon £11.00 and discover later that there is no VAT to reclaim, making the net cost to me £11.00.
As a VAT registered entity, your client also has the opportunity to supply Amazon with their VAT number and have the VAT deducted at source, but that won't work in all cases - marketplace purchases, for example. (As an aside, the one time I did that, for a client, we then had trouble actually paying for something with the company card, and ended up buying it elsewhere!)
* I only very rarely buy stuff and pay using Paypal, and I don't think I've received a payment for anything since before I was VAT registered, which must be at least ten years ago.
-- Edited by VinceH on Monday 27th of October 2014 06:40:53 PM
-- Edited by VinceH on Monday 27th of October 2014 06:42:35 PM
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Vince M Hudd - Soft Rock Software
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