Section 1 - eComengine LLC · An Introduction to Shipping and Sales Tax in Europe for Amazon Sellers Ocean Freight You can choose FCL (full container load) or LCL (less than container

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 1A Seller’s Guide to Shipping in Europe

Shipping Glossary and Costs Overview .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Customs Nomenclature . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Labeling & Shipping Routing Guide For Amazon Stores . . . . . . . . . . . . . .

Requirements for Small Parcel Delivery, LTL or FTL . . . . . . . . . . . . . . . . . . .

LTL and FTL Large-Volume Shipments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Carrier Related Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Meet Shypple: Digital Freight Forwarder of Choice . . . . . . . . . . . . . . . . . . .

Section 2All You Need to Know about Taxes in Europe:

A Simple Guide for Non-European Amazon . . . . . . . . . . . . . . . . . . . . . . . . .

Your Monthly Registration Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Delivery Thresholds Within Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Import to the EU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Sales Tax: Tax Obligations in Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2018 VAT Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

European Sales Thresholds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Amazon Programs in Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Obligations of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

An Introduction to Shipping and Sales Tax in Europe for Amazon Sellers

2www.ecomengine.com |

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https://www.ecomengine.com?utm_medium=download&utm_source=ebook&utm_campaign=shipping+sales+tax+europe


With competition being so aggressive on marketplaces such as Amazon and eBay, selling branded goods as a reseller is no longer lucrative. Companies such as Alibaba and AliExpress have made Far East sourcing more accessible and today more businesses are creating their own private labels, working directly with the factories in order to sell a more profitable product. In addition, sellers are expanding their business internationally, not restricting their sales solely to one country. Platforms like Amazon are providing sellers incentives to export, with a Global Sales team at the ready to support and guide them. When importing products into another country, sellers must consider the logistics and country specific requirements. How they ship the items, the cost of importing the goods, taxes and the steps they need to take to ensure their products are compliant in the country they wish to sell. This article looks at the importation process and is broken down into two key sections; shipping and sales tax. In the first section, Shypple looks at the different shipping methods, providing a useful glossary on the terms used. They look at how products are categorized at customs when it comes to paying duties and also, look at the labelling requirements for Amazon FBA, for those looking to ship product directly into an Amazon Fulfilment Center. In the second section, TaxFBA offers information about European sales tax. They provide a simple guide for non-European Amazon sellers on how to start selling in Europe when it comes to managing VAT.

-Carina McLeod

Introduction

About Carina McLeod

Carina spent over 7 years working at Amazon within

Retail and Vendor Management. She spent her first

years there as a Vendor Manager and later specialized

in launching new categories into the UK market.

In 2013, Carina founded eCommerce Nurse, which

helps manage and support both Sellers and Vendors

in growing their businesses on Amazon. In 2018, she

launched

Vendor Society, a membership website that provides

vendors the tools and support they need to maximize

their sales potential on Amazon. Through her

experience at Amazon she can happily say she speaks

“Amazon” proficiently, knows their requirements and

systems and, most importantly, knows what it takes to

become a successful Vendor and Seller on Amazon.


https://ecommercenurse.com/

https://vendorsociety.com/



Ocean Freight

You can choose FCL (full container load) or LCL (less than container load, meaning one or

multiple pallets). A full container load does not necessarily mean that the cargo fills an

entire container, but rather FCL shipping is a shipment mode. There are several benefits

to choosing the FCL shipping mode rather than LCL. There is a reduced risk of damage

and even quicker transit time because FCL doesn’t need require consolidation and

deconsolidation, which may take 2 to 3 extra days at the ports of origin and destination.

From a certain break-even point, FCL becomes the cheaper mode, levelling the price of

shipping LCL. On the other hand, shipping LCL is more popular among small and medium

companies that manage smaller volumes of cargo (yes, the charges will be higher by unit

but keeping the inventory low leaves more room for other necessary purchases).

A Seller’s Guide to Shipping in Europe

Shipping Glossary and Costs Overview

One of the most common questions we hear from Amazon stores (or importers,

in general) is What do these fees stand for in my freight forwarder invoice? In

this section, we will discuss which charges (common & non-standard) one can

expect to see when a freight forwarder sends the pricing list.

If you are sourcing your products from China, ocean freight is the best option for

transportation of bulk goods, and sometimes it is the only option. Air freight and

railroad freight may be available.




Type of Costs

Pick Up Fee This fee covers haulage from the exporter’s premises to the port/

warehouse.

Doc Fee Sometimes referred as a Freight Forwarder Handling fee. This fee is associated

with processing paperwork, copying documents, and preparing the air waybill/ocean bill

of lading (or other bill of lading). It helps freight forwarders cover the cost of processing

and handling shipments.

ISPS / IFS The ISPS abbreviation stands for International Ship and Port Security.

In terms of the ISPS code, shipping lines, ports and terminals are required to place

appropriate security officers/personnel on each ship, in each port facility and in each

shipping company to prepare and to put into effect the security plans that will be

implemented. Typically the ISPS charges form part of the freight quote and is required

to be paid along with the freight and therefore whoever pays the freight (shipper or

consignee) will also pay the ISPS surcharge.




Terminal Handling Charges (THC) A charge assessed by the terminal for handling FCL’s

at ocean terminals. This charge is an aggregation of costs associated with the terminal

provider’s property and only applies to ocean freight. The costs covered include access,

equipment maintenance & use and labor (stevedoring). The property covered includes the

wharf, the carrier’s terminal facility or a container freight station (CFS).

Ocean Freight Fee The Basic Ocean Freight (BAS) is a transportation rate for moving

the cargo. The rate is price determined by varying factors such as the different origin-

destination combinations and the cargo type.

VGM / Solas fee This refers to the “Verified gross mass” of a shipment, a check

performed by the carrier to verify the weight of a container.

ENS This fee refers to the “Entry summary declaration” which is required by EU

customs to do a security assessment of all cargo entering EU ports.

B/L or bill of lading fee The bill of lading a document which is required to ship goods.

It works as a contract of freight services between a carrier and shipper.

CFS Fee The charge assessed for services performed at the origin or destination for

loading or unloading of cargo into/from containers at a CFS (Container Freight Station).

This fee is related to LCL shipments.

Haulage Fee Haulage is the term given to any inland movement that takes place after

the container is discharged at a port of discharge.




T1 fee This fee is applied to cover the costs related to issuing T1 documents. T1

documents are required for European Union tax regulations when transporting non-

community goods between two locations in the EU Customs area. This fee is applicable

for all European Union shipments and allows taxes to be suspended until the cargo

reaches its final destination. Applied per T1D document issued

Charges that won’t be on the quote but may be on the invoice depending on the

circumstances:

Demurrage Demurrage costs are charged when a full container is not picked up at

the port for unloading within the allowed number of free days to do so offered by the

shipping line. These costs will be charged for every day that exceeds the originally agreed

number of free demurrage days.

Detention When the importer (or his forwarder) picks up the container for unloading

(thereby ending the demurrage days), there are a fixed number of days in which the

importer is required to unload the container and return it empty to the depot of the

carrier in the port. When an importer needs more days than provided by the carrier to

unload the container and return it, detention costs (per day) will be charged.

Peak Season Surcharge (PSS) This is a seasonal fee applied during high volume

shipping periods in certain trades. The fee is applicable to all shipments that move in

these trades during the high volume periods.

Fuel Surcharge (FSC) A fuel surcharge (FSC) is a fee assessed by a carrier to account for

regional / seasonal variations in fuel costs. A fuel surcharge helps protect the carrier from

the volatility of fuel prices.




Air Freight

Air Freight The cost of moving cargo by air. Chargeable weight of air freight shipments

are calculated as the actual weight (gross weight) or the volumetric (also called volume or

dimensional) weight of the shipment, whichever is the greater.

Security Surcharge This surcharge covers additional security measures mandated by

the airport authority.

Airline terminal handling fees Applied to all air shipments and includes costs

associated with handling the cargo. Terminal handling charges may be included in the

cumulative air freight fee or listed as a separate line item, depending on the airline.

Besides these costs that are in high correlation with the selected mode of transport, there

are costs that occur regardless of that fact. Examples of these include customs clearance

fees, insurance fees and customs duty.

Customs clearance fees Charges levied by the customs broker in order to handle

clearance with Customs authorities, such as submitting the Customs Entry form and

Customs Bond usage.

Customs duty Tax levied on imports by Customs authorities to raise state revenue and

protect domestic industries.

.




The EU customs nomenclature, which is a tool for classifying goods, is based on:

• the Harmonized Commodity Description and Coding System of the World Customs

Organization, at six-digit level,

• the Combined Nomenclature of the EU for the current year – at the seventh and

eighth digits level.

The ninth and tenth digits (known as TARIC = Integrated Tariff of the European

Communities) encodes Community measures such as anti-dumping rules, duty

suspensions or tariff quotas.

Customs nomenclature represents the base for:

• import duties

• trade statistics

• origin regulations

• trade agreements

• risk analyses

• Customs information systems

To have legal certainty that correct classification for goods is applied, an importer should

take into consideration a Binding Tariff Information (BTI) decision. A BTI is a document

issued by the customs authorities upon the request of the importer/exporter, in which a

precise tariff classification for goods is specified. The document can be presented to any

European Community customs authority during a period of three years. One can view all

currently valid BTI decisions in the public BTI database. The link is https://goo.gl/EQO7t.

You can see current customs information here: https://goo.gl/nPQk2v.

Customs Nomenclature


https://goo.gl/EQO7t

https://goo.gl/nPQk2v



Practical Examples

Let’s look at an example of the types of things you need to consider as an importer. If you

import gloves to the EU from China, here’s what you would need to think about. If the

gloves are made for all purposes and are of vulcanized rubber other than hard rubber, then

40151900 is the right tariff code and import duty rate is 2.7% on the value of goods.

However, if the gloves are made of textile material but impregnated, coated or covered with

plastics or rubber then 61161020 is the appropriate choice and import duty rate is 8%. To

make things more even more complicated, certain type of gloves (depending on the type

of plastic material and the manufacturing process) goes in 39262000 with import duty rate

of 6,5%.

Having the right information regarding customs duties, associated taxes and necessary

additional documentation for import (which is again in high correlation with the goods

and appropriate HS Code) does have a great impact on decision whether it’s a go or no-go.




Labeling

The FBA program uses barcodes to identify and track inventory throughout the fulfillment

process. Each product sent to an Amazon fulfillment center requires a barcode. There are

two kinds of barcodes that are used to identify products:

Labeling & Shipping Routing Guide For Amazon Stores

In the past year, we have experienced an ever-increasing demand from

European-based Amazon buyers and sellers to have more visibility, insight and

control over their shipments. The Shypple team has helped a wide variety of

businesses with the shipment process from purchase, collection and labeling of

goods up to warehousing or delivery.

Are you looking for new ways of organizing your freight shipments from or

to Europe or are you planning to start buying or selling goods via Amazon in

Europe? We are in position to offer freight forwarding & customs brokerage

service via major European seaports such as Hamburg, Bremen, Rotterdam

and Antwerp. When it comes to sending goods to Amazon warehouses, the

most important requirements are those related to labeling and shipping &

routing. We bring you insight into all of these tiny details that are important for

a flawless process.




• Manufacturer barcodes (eligible barcodes include GCID, UPC, EAN, JAN or ISBN)

• Amazon barcodes (ASIN, FNSKU or MSKU)

Products that do not use the manufacturer barcode for tracking require an Amazon

barcode. A seller can print Amazon barcodes from within the seller account and apply

the barcodes. If a seller does not want to apply the barcodes, they can sign up for the FBA

Label Service and have Amazon apply the labels for a per-item fee ($0.02).

Each box or pallet shipped to an Amazon fulfillment center must be properly identified

with a shipping label. Guidelines for labeling boxes:

• Labels supported measure 63,5 x 29,6 mm.

• Don’t place labels on a seam on the box where they will get cut by a box cutter.

• The FBA shipment label should be placed next to the carrier (UPS, FedEx or other)

label.

• Both the FBA shipment label and the carrier label (UPS, FedEx or other) must remain

uncovered so they are scannable and readable.

• Each box you include in the shipment must have its own label. Each pallet needs four

labels, one in the top centre of each side.




Requirements for Small Parcel Delivery, LTL or FTL

There are standard requirements that apply to all boxes shipped to Amazon fulfillment

centers whether by small parcel delivery, less than truckload (LTL) or full truckload (FTL).

These requirements are related to box content information, box dimension (“Boxes

containing multiple standard-size items must not exceed 63 cm on any side”), box weight

(“Boxes must not exceed the standard weight limit of 30 kg, boxes weighing between 15

kg and 30 kg must be marked “Heavy Package”), approved containers and even approved

forms of dunnage! For more detailed information on these matters, please see Amazon’s

shipping and routing requirements.

Besides product barcode and shipping label, there is a question of a shipping mark. A

shipping mark is simply a mark on the outside of the exterior shipping carton of an item

being exported. At the minimum, shipping mark should include weight and dimension of

a single carton, the number of the carton and total number of cartons (such as 1/50, 2/50,

3/50), the number of units in carton and information on actual product (content), country

of origin (“Made in China”), and the manufacturer’s information.


https://sellercentral.amazon.de/gp/help/external/help.html?itemID=200141510&language=en-GB&ref=efph_200141510_relt_200141500



Based on the shipping method used, there are additional requirements:

• Small Parcel Delivery Requirements

• Arranging for LTL or FTL deliveries to Amazon

LTL and FTL Large-Volume Shipments

We’ve already shared some brief guidelines for small parcel delivery requirements in

the initial paragraph. Additional preparatinos are required for LTL or FTL shipments,

including wrapped pallets. The seller and chosen carrier are responsible for meeting

these when sending large-volume shipments to Amazon. Some of these requirements are

related to:

• Using acceptable pallets (in all EU countries - 800x1200 mm Euro/CHEP certified DIN

15146)

• Building pallet shipments (pallets can be built up to a maximum of 1.8 meters high,

including the pallet. Double stacked pallets: 2.7 meters for DE /CEE and 3.0 meters for

UK, FR, IT and ES. For details, see EU FCs addresses and delivery specifics)

• Adhering to pallet label requirements (I.E. All pallets must be stretch-wrapped in clear

plastic with a ‘do not break stretch-wrap’ or ‘do not break down’ notification to the

carrier. Pallets wrapped in black/opaque stretch-wrap may be rejected.

• Providing the bill of lading (BOL)

• Scheduling a delivery

• Providing your carrier with Amazon reference IDs, shipment IDs, and tracking (PRO)

numbers




Carrier Related Requirements

There are a few carrier related requirements. The carrier:

• Needs to have Amazon Reference IDs, Shipment IDs and tracking (PRO) numbers

• Schedules advanced delivery appointments

• Adheres to the vehicle condition requirements

For more detailed information on all of these matters, please visit https://goo.gl/9NXTpJ or

contact the Shypple Operations team.


https://goo.gl/9NXTpJ



As a digital forwarder, Shypple offers customs brokerage and freight forwarding services.

Shypple offers importing and exporting enterprises a central and digital web-app that

acts as a supply chain dashboard for all shipments in transit, planned and delivered.

The web-app helps importers and exporters as it forecasts in a variety of booking,

planning, delivery and communication functionalities. Multiple users from your company

can access this tool and be in direct contact with our operations coordinators. When a

shipment is booked within our web-app, users within the company are automatically

updated via a milestone overview that sends automated updates with regards to ETA

adjustments and milestone achievements; for instance: booking confirmed, shipment

departed, customs clearance completed and delivery date can be planned.

Shippers can easily select the services they need, add weights and dimensions and

request (when door to door / Ex Works) or book a shipment (when port to door / FOB)

directly from the easy to use web-app. Several shipping possibilities will be shown for

ocean freight, whereas air freight can be easily requested via the search tool. By offering

direct insight in shipping tariffs and sailing schedules from and to Rotterdam and

Antwerp (Hamburg is also possible as a request) we can offer cheaper rates and the

possibility to directly arrange a shipment via Shypple’s web-app, instead of hassling over

phone and email!

Shypple: Digital Freight Forwarder of Choice




After a shipment is booked, a central overview is created, with several tabs that offer all

the required information. Both our shippers and our operations managers can share

and download information, documentation and add comments. Whenever you or your

colleagues add information, documentation or comments notifications will be triggered.

This results in very fast communication, limits errors and offers more insight and control

in/over shipments.




Another great tool for shippers is our integrated track & trace plugin, which offers live

insight regarding the current location of your shipment (for both sea and airfreight

shipments). Is your shipments’ estimated time of arrival delayed? You will be notified

within 15 minutes. This helps you to better inform clients on time and enables us to work

towards possible solutions faster.




Are you looking for new ways of organizing your freight shipments from or to Europe or

are you planning to start buying or selling goods via Amazon in Europe? Get in touch with

our eCommerce expert Milan at [email protected], we would be glad to help you!




All You Need to Know about Taxes in Europe: A Simple Guide for Non-European Amazon Sellers to Start Selling in Europe Immediately

While the US eCommerce market seems to be largely saturated, many companies now

find great potential in the Asian and European markets. As one of the key markets,

Germany plays a major role. Since Amazon claims more than a third of the market, it is

only logical to sell its products from the German and European fulfillment centers.contact

the Shypple Operations team.

Local Warehousing Means Immediately Paying Local Taxes

The tax law in Europe dictates that the accumulated VAT must be paid in the state

in which the delivery starts. This means that, if warehouses in Germany are used, for

example, for deliveries to several European countries, sellers are required to register their

company at the German tax authorities. Now Amazon offers various programs:

PAN-EU

By enrolling in the PAN-EU program the seller gives Amazon permission to use all

European fulfillment centers - more specifically UK, Germany, Spain, France, Italy, Poland

and Czech Republic. This gives Amazon sellers the chance to place inventory closer to the

end customer and thereby ensure faster delivery. Whenever a seller decides to activate

PAN-EU, he is immediately obligated to register in all countries named above. In addition,

requirements for the monthly VAT compliance must be met.




EFN

Instead of using the PAN-EU program, it is also possible to make use of the European

Fulfillment Network (EFN). Sellers can benefit from using Amazon’s fulfillment network

as well as the Prime shipping status when enrolled in the EFN program. They will need to

register for VAT only in Germany, Poland and Czech Republic. One downside is that the

delivery time can be significantly higher when selling to customers in other countries.

Depending on the number of orders, utilizing the PAN-EU or EFN program makes a

lot of sense. By deciding on one of these different programs from Amazon, registration

obligations in these different European countries arise and must be met.

Your Monthly Registration Process

Along with the obligation to register, (mostly monthly) sales tax advances must be

submitted. In the process, the revenues are assigned to the country where a warehouse

(fulfillment center) has been used by utilizing a specially built software for that purpose.

The monthly statements must then be submitted to the tax authorities in time.

Subsequently, the sales tax must also be paid to these designated tax offices in time.

The easiest way to illustrate this is with an example:

The American online retailer has discovered the European market for selling their

products. To ensure that all necessary tax related requirements are met, a decision has

been made to contact a tax specialist.




Firstly, the expert advises to go with a warehouse in Germany, takes care of the

registration in Germany and processes the necessary monthly declarations in the same

country.

Extending Reach Step By Step

After a certain period, sales are up! It makes sense to use fulfillment centers in other

European countries, as well. At this point, the recommendation is to use Amazon’s Central

European program. However, this will trigger the registration requirements in Poland and

the Czech Republic. Working alongside several cooperation partners, the tax expert can

facilitate the registration process in these countries while always considering distinctive

regulations depending on the country. In Poland for instance, a fiscal representative is

necessary. Since the fiscal representative in case of doubt has to be liable for the tax loss

at the Polish tax office, the American online retailer must deposit a large sum in a trust

account.

Be Aware of Delivery Thresholds Within Europe

When selling in Europe, one must be aware of delivery thresholds. This means that

deliveries from a German warehouse initially lead to tax liability in Germany. If a delivery

threshold (in this case the delivery threshold to Austria) is exceeded (according to Austria,

it is EUR 35,000 per year), the American online retailer must also register for tax purposes

in Austria. Our European tax software makes it possible to calculate exactly which sales

are taxable in which European countries and take care of registrations and monthly

statements.




Rinse and Repeat for Other Countries

After a few months, the American seller wants to expand further and sell in other

European countries. After becoming familiar with the benefits of using the PAN-EU

program, a decision is made to start the registration process in the other PAN-EU

countries (United Kingdom, France, Spain and Italy). For Spain, the same requirements

regarding fiscal representation apply as for Poland. The VAT returns are generated

monthly.

Start With a Clear Roadmap and Update Accordingly

It is important to know that the allocation of tax numbers in Europe can take up to

six months. Therefore, sellers considering different Amazon programs should plan

accordingly and start the registration process, e.g. applying for a tax number, ahead of

time. In addition to the monthly statements, annual declarations have to be submitted

in almost all European countries. With each state in which a tax liability arises, there

are further declarations to be made; for example, the intra-community displacement,

which should be reported. This means that Amazon sends goods across Europe and the

European tax authorities want to check these goods’ movements to avoid tax evasion. The

acquired information is then shared between European countries.

The Secret Shortcut Everybody Can Use Now

We recommend that Amazon sellers who are expanding to selling in Europe first register

in Germany and initially only use the fulfillment centers there. For American sellers, the

tax office “Bonn-Innenstadt” is in charge of processing the registration and handing

out the tax number. For the registration, various documents need to be submitted.

The easiest way is to grant the chosen tax specialist power of attorney and transmit all

necessary documents to the German consultants, so they can be further processed.




The American online retailer only has to pay sales tax in Germany or Europe. Income taxes

continue to be fully paid in the US. It is also possible to establish a company in the form

of a corporation (GmbH) in Germany. In this case, the income tax in Germany would also

be payable and amounts to around 30 percent of the profit.

But let’s look at it in more detail:

Import to the EU (especially Germany)

The European Union is both a political union as well as an economical union, with

28 member countries in Europe. Together, those countries represent the majority of

the continent and the biggest trading partnership in the world. In addition to this

partnership the trading cooperation extends to the EWR, including countries like Iceland,

Liechtenstein and Norway. Through a bilateral agreement Switzerland is included as well -

one important exception is that these countries are excluded from the European customs

union.

Benefiting from the Internal European Market trading is made quite simple among most

European countries. As mentioned before, the Internal European Market was established

in order to optimize cross border trading. As a result, importing within the EU is a simple

and effective process.

But first, products need to be imported to Europe. As one of the strongest European

markets, Germany is a good place to start. For the import from Non-European countries,

the seller normally hires a freight forwarder who also handles the customs clearing.




• Import Sales Tax: A special form of collection for the sales tax with one

rule set (19% or the reduced tax rate of 7 %).

European import duties include: import sales tax, excise taxes and customs duties

• Excise Taxes: A tax applied on beer, tobacco, alcohol and mineral oil with

the same rate that is applied when those goods leave the country.

What is the based value of the customs clearance?

Customs value is the basis of assessment for levying import tax. Normally this

is the transaction value, meaning the net invoice price to be paid. Further

information regarding customs duties as well as import tax can be acquired

by indicating the customs-tariff number at the “electronic customs tariff”.

• Sales Tax: Tax Obligations in Europe

After goods are stored in a European warehouse, retailers can start selling

their products. For Europe this means: Sales tax is to be paid in the state

where the delivery starts (BtoC deliveries). For BtoB, other regulations apply.

Those deliveries are normally tax free. However, most deliveries are BtoC.

All European countries have different tax rates. Consequently, Non-European

companies can benefit from storing their goods in a country with a low

tax rate. As mentioned above, Amazon has warehouses in the following

countries: Germany, UK (although Brexit will have an impact here), Spain,

France, Italy, Poland and Czech Republic.




Germany 19%United Kingdom 20%France 20%Spain 21%Italy 22%Poland 23%Czech Republic 21%

2018 VAT Rates

VAT should be included in your calculations when selling goods in Europe. For example,

when selling from a German warehouse to customers in Germany 19% sales tax needs to

be added to the net price and paid to the German state.

Note: The import tax which has been paid previously can be deducted 100%.

European Sales Thresholds

European states have thresholds. If the threshold is exceeded, taxation according to

the country of destination - not origin - begins. For example: The threshold to Austria is

35,000 EUR per year. The online retailer supplies his BtoC customers with goods from

his warehouse in Germany. On 10/25/2018 the threshold of 35,000 EUR is surpassed.

Consequently, sales tax changes from 19% for Germany to 20% for Austria. This also

means that invoices need to be written according to Austrian law (every European

country has different invoice regulations) and the sales tax needs to be paid to the

Austrian taxation authorities.




EU-State Thresholds Standard tax rates

Belgium 35,000 EUR 21%Bulgaria 35,791 EUR 20%Denmark 37,557 EUR 25%Germany 100,000 EUR 19% Estonia 35,000 EUR 20%Finland 35,000 EUR 24% France 35,000 EUR 20%Greece 35,000 EUR 24%Ireland 35,000 EUR 23%Italien 35,000 EUR 22%Croatia 36,000 EUR 25%Latvia 34,052 EUR 25%Lithuania 36,203 EUR 21%Luxemburg 100,000 EUR 17%Malta 35,000 EUR 18%Netherlands 100,000 EUR 21%Austria 35,000 EUR 20%Poland 40,293 EUR 23%Portugal 35,000 EUR 23%Romania 28,012 EUR 20%Schweden 36,232 EUR 25%Slovakia 35,000 EUR 20%Slovenia 35,000 EUR 22%Spain 35,000 EUR 21%Czech Republic 46,570 EUR 21%Hungary 32,257 EUR 27%United Kingdom 81,843 EUR 20%Cyprus 35,000 EUR 18%




Amazon Programs in Europe

Amazon Central Europe (EFN)

Among other programs, Amazon offers the “Central Europe” program. As explained before

this means utilizing the warehouses in Germany, Poland and Czech Republic. Here,

the online retailer benefits from favourable Amazon rates (0.50 EUR less with each unit

sent by Amazon leaving an Amazon warehouse in Germany, Poland or Czech Republic).

Storing products in the warehouses in Poland and Czech Republic triggers additional tax

obligations like Intrastat declarations. Therefore, the online seller not only needs to register

in Germany but also in Poland and Czech Republic in order to provide the monthly VAT

declarations in these three countries.

Amazon PAN-EU

This program includes the following countries: Germany, UK, Spain, France, Italy, Poland

and Czech Republic. If a retailer decides to participate in this program and sells his

products on the European market, he only needs to pay the local fulfillment fee charged

by the warehouse. In comparison, by using the EFN program the online seller has to pay

an additional fee for each delivery that crosses the state line. However, whenever the PAN-

EU program is utilized, this also means that registrations as well as monthly declarations

in all named countries need to be done.

Costs of registration for each country amount to approximately 500 EUR and have to

be paid once. Prices for the monthly sales declarations are around 100 to 150 EUR per

month and country. Hence, if orders are approximately 500 units per month, the Central

European Program should be considered, while orders of around 2,000 units per month

suggest that the PAN-EU program could pay off. This calculation does not consider the

additional savings from the normally applied cross border fee, which in this case does not

apply.




Obligations of the Company

The company owner, with support from his freight forwarder, is responsible for the

import of his products. The freight forwarder usually handles the acquisition of the

necessary EORI number. The EORI number (Economic Operators Registration and

Identification number) is assigned from the European Union to each economic operator

for identification purposes among other business entities or customs authorities.

Furthermore, the retailer has to comply with VAT obligations and register in each

country where the local warehouses are used. Normally this registration is carried out

by tax advisors. In Germany there are several consulting firms who are specialized in

coordinating the registration in other European countries (e.g. TaxFBA).

In addition, the retailer is responsible to declare monthly sales tax in each country where

warehouses are used.

If additional thresholds are exceeded, the company owner has to register at the local tax

authorities in the relevant country and provide monthly sales tax declarations.

The TaxFBA (www.taxfba.de) team is happy to assist you.




SHYPPLE

As a digital forwarder, Shypple offers all services required to ship your goods

from A to Z. From door pick-ups, pick-up, customs brokerage, ocean, air and

rail freight to on-demand warehousing, we are there for you.

shypple.com

TAXFBA S. MBH

As specialists in the areas of consulting and digital accounting TAXFBA

provides a unique full service for online retailers. Contact TAXFBA and book

your first (free) appointment for more information.

taxfba.de


ECOMENGINE

eComEngine has been helping sellers accelerate growth on the Amazon

marketplace through powerful automation for over a decade. Merchants all

over the world use our flagship tool, FeedbackFive, to manage their seller

reputations. From inventory management to product research, eComEngine

offers time-saving solutions for sellers of any size. To learn more, visit www.

ecomengine.com.

https://shypple.com/

https://taxfba.de/en_GB/




Documents

Section 1 - eComengine LLC · An Introduction to Shipping and Sales Tax in Europe for Amazon Sellers Ocean Freight You can choose FCL (full container load) or LCL (less than container