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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15915
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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I am looking to have an ebay business account .My products

Customer Question

I am looking to have an ebay business account .My products are fragrances which i purchase from the u.sa.I pay v.a.t.when the item arrives.What am i able to claim for in expenses.Am i able to claim ebay fees back and postage.
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.
Hi.

If you are registered for VAT which you need to be if your turnover is more than £79,000 for the previous 12 months or will be in the next 30 days, then you can reclaim the VAT you pay by offset against the VAT you would charge your customers. A VAT registered business does not in theory pay any VAT itself in net terms. It just acts as an unpaid tax collector for the government. If it collects more VAT from its customers than it pays it suppliers, then it pays over the excess to HMRC. If it pays more in VAT to its suppliers than it collects from its customers then it will be due a repayment of the excess. Take a look here for information on VAT.

If you aren't registered for VAT, you can claim the VAT you pay as an expense as you can with your ebay fees, postage, shipping charges, storage fees, paypal fees, credit card fees, any expense that you incur that is related to your business. Take a look here at the types of expenses that a business can claim. It clearly won't include the type of expenses directly related to the type of business you run.

I hope this helps but let me know if you have any further questions.
Expert:  TonyTax replied 3 years ago.
I can see that you have read my answer to your question. If you have any more questions, please don't hesitate to ask them. If not, please rate my answer so that I am paid for my work. Thanks.

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