Different prices showing

[TheGemstoneCave]

I am in Europe, Spain and till last week everything was going great, sales down like most folks. Now the prices shown are way higher than I am charging, in Europe for example we don't pay VAT, I understand that different states in the US pay sales tax that Etsy collects, but we don't pay VAT to other European countries apart from the UK, Etsy take the VAT and pays direct, the same as the US, anyone else have this problem and can't get any help from Etsy.

[audreytherese]

Maybe give some examples of what prices are supposed to be vs what is showing so others may be able to figure out why there's a difference? 

[ByVanillaMintDesigns]

Yes, I see that the Dutch 21% VAT is added once I go into the listing. So for example your Rosary shows €19,95 in the overview but once I go in to the listing it is €24,14. 

I am wondering if Etsy is collecting VAT within the EU for non VAT registered sellers? Are you VAT registered? 

[TheGemstoneCave]

No I am not VAT registered as my income is less than the threshold

[TheGemstoneCave]

I have just sold a pair of earrings to someone in Canada for 19.95 euros, there is no added tax for Canadian customers, but the price showing is 24.14, all my prices are in euros, people will surely be put off when they see the price, I sold three items to European customers last week and they charged the customer 21% VAT, this is wrong

[CappuccinoLace]

This may be linked to a bug with VAT seen in UK to UK listings, where Etsy should not be collecting VAT at all.

Trouble is, it's not happening to every UK seller with a UK buyer. It appears completely random.

Link to that thread:

https://community.etsy.com/t5/Technical-Issues/VAT-BUG/m-p/145309314/highlight/true#M844941

[TheGemstoneCave]

Thanks, I read that thread, it's really no help to me as I am not in the UK. But I am a UK business even though I live in Spain, it's all perfectly legit.

As I am under the UK VAT threshold when I sell an item to the UK,  Etsy give their VAT number to put on the package so the customer doesn't get charged twice. 

[FancyTogs]

@TheGemstoneCave 

"As I am under the UK VAT threshold when I sell an item to the UK,"

The normal UK VAT registration threshold only applies to sellers located in the UK. 

If you sell goods despatched from the UK to the UK (eg. using a UK fulfilment warehouse, a UK partner or a UK POD printer), as a non-UK seller, then there is a zero registration threshold so you would need to be UK VAT registered and collect UK VAT yourself.

The problem being seen with Etsy collecting VAT when they should not be doing so looks like Etsy getting it wrong again.

It is not a universal problem. It appears to be something to do with particular sellers who have mismatched country information in their account data.

Lawrence (Clare's other half)

[ByVanillaMintDesigns]

So your business was set up in the UK, but you are currently selling from within the EU? There is another thread with someone in the same situation, a seller in Slovakia whose business was set up in the UK and is now having EU orders charged with VAT. Looks like VAT is being triggered by something in your account set up that still links to the UK and seeing EU orders as imports? 

[TheGemstoneCave]

I kinda thought that, but it doesn't explain why UK customers are charged VAT as well, this only happened in the past week

Cake and eat it springs to mind

[Arcalliq]

@TheGemstoneCave 

I have exactly the same problem. I am UK registered business, but whilst I am visiting my parents in Slovakia for few months, I am selling from there.

EU buyers are being charged VAT but UK buyers are also charged VAT. I have tried to update all the possible settings. I have been on email with Etsy support for hours but they have absolutely no idea what I'm talking about and just keep sending the same blurb from help pages that just does not apply to me at all at the moment.

[TheGemstoneCave]

Lawrence

So basically Etsy need to sort this >:)

Gonna have a log wait then

[GlassyFields]

Etsy code might have some logic that looks at physical location first ... which would throw off the rest of the logic for determining if VAT should be added.

[TheGemstoneCave]

I will try and get Etsy to look into it, if I could only find a way to contact them......

[FancyTogs]

I suspect that Etsy is seeing your location as UK from somewhere in your data.

Are they telling you to use the IOSS number on EU orders?

Check the country in your tax details.

The address used in Seller Details defaults to the country in your tax details, but I don't see any Seller Details.

Interesting, you still have the old long form policies.

Try setting your shop location correctly, that may be needed as a prompt for correct tax, and it is used for the EU localisation ranking boost.

Lawrence

[TheGemstoneCave]

I had this problem a couple of years back with Etsy's system, eventually they fixed it for me, I registered as a UK business and till now everything has been no problem, if they are adding 21% to everything I will be as well shutting the shop, thanks

[FancyTogs]

I think I have worked out what is happening . . . Etsy have finally started to collect VAT correctly.

You know that special condition I posted about earlier in this thread? for zero threshold UK VAT registration for non-UK sellers selling goods from UK to UK, it applies when the seller is selling direct, but it does not apply when selling through a marketplace, instead the marketplace becomes responsible for collecting VAT.

When IOSS was introduced in July 2021 there were 2 situations when Etsy (as a marketplace) should have been collecting the VAT on sales to EU consumers:

• any goods being imported into the EU under €150 intrinsic value, using the IOSS system,
• all goods sold by non-EU sellers being despatched from EU locations to EU consumers, any value

Etsy did not action the second condition, until now.

Similarly, basically the same rules apply for the UK (who wrote the EU rules while still in the EU) for sales to buyers in the UK. Since January 2021 Etsy should have been collecting the VAT on sales to UK consumers for:

• any goods being imported into the UK under £135 intrinsic value,
• all goods sold by non-UK sellers being despatched from UK locations to UK consumers, any value.

and again, Etsy did not action the second condition, until now.

It looks like Etsy have finally done something correctly for VAT.

The problem we are seeing in the forum is that it is going wrong for sellers with mixed country settings.

Either

• the sellers have an incorrect country setting somewhere,
• or Etsy are using the wrong country setting for these sellers (either the seller country, or goods despatch from country),
• or Etsy really should be charging VAT on some of these sales.

Lawrence

[FutureisretroStore]

I actually posted a reply to this earlier in this thread I think. Once you have opened your store, Etsy does not have the ability to change where your store is located. It's stuck that way permanently. You can change the details on your store under settings, but it won't actually change the basis for where you are located. 

I set up my store in Australia, but moved to the UK. I can't use Etsy payments because it won't let me adjust the bank account to be a UK account, it just wants me to put in Australian details. 

It's ridiculous. 

[Zillify]

i would like to know who gets to keep this vat and when it comes time to pay tax who's going to be paying. I'm in Portugal and we have to show our income and pay tax on it. so will Etsy give us the tax charged? or should we tell the Government to talk to Etsy and get it from them?

[FancyTogs]

VAT which is collected by Etsy is reported by Etsy. Sellers need to report their income excluding VAT collected by Etsy.

When Etsy charges the buyer VAT it goes into the seller's shop account within the buyer payment for the order. Etsy then have an additional transaction to remove the VAT from the seller's shop account, so that Etsy can pass the VAT to the appropriate government.

Lawrence

[CraftyCornishMaids]

@Zillify 

for digital downloads, which you sell,

Etsy collects the VAT (a sales tax), and remits it to the correct government,
depending on which country the buyer is in, they send it to that countries government, and they remit it against THEIR VAT number.

If you are VAT registered, for  digital downloads, you have to invoice etsy as a reverse charge

....

For income tax, you still have to pay that, etsy doesn't collect any income tax.

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