Amazon VAT compliance – what every seller in the EU needs to know

When operating under the FBA (Fulfilled by Amazon) model, products can be stored and shipped from various EU countries, which automatically generates specific VAT obligations. That’s why it’s essential to understand how VAT works in the context of international transactions – from VAT registration in other countries to using simplified schemes like the OSS (One Stop Shop).

Why is this so important? Because mistakes in VAT reporting can lead not only to financial losses, but also to issues with tax authorities, blocked sales accounts, or loss of customer trust. Professional Amazon accounting is no longer just a helpful service – in many cases, it’s a necessity.

In this article, we’ll answer the question many sellers ask when entering Amazon’s European markets: what should I pay attention to when handling VAT in the EU?

Step by step, we’ll go through:
• how the place of storage and shipment affects VAT obligations,
• what intra-community acquisition of goods (WNT) is and how to report it,
• when VAT registration is required in other EU countries,
• how the VAT OSS system works and when it makes sense to use it,
• and how to manage accounting records to avoid errors and penalties.

If you’re already selling through Amazon FBA in the EU, or planning your expansion, this guide will help you understand the essentials of VAT compliance and move confidently through the regulatory landscape.

Let’s get started.

Where are you shipping from? Location matters

If you’re selling through Amazon FBA in Europe, there’s one key thing to keep in mind: the location of your inventory can determine where you’re required to pay taxes. This single factor often decides whether your Amazon VAT compliance will be relatively straightforward or significantly more complex.

Amazon EFN vs. Pan-EU – two models, two sets of obligations

Amazon offers two main logistics models for sellers operating within Europe: the EFN (European Fulfilment Network) and Pan-EU (Pan-European FBA). On the surface, both appear similar – Amazon stores and ships your products, and you focus on growing sales. But when it comes to VAT, the differences are significant.

EFN model

The EFN model allows you to store your products in just one EU country (e.g. Poland), and Amazon ships orders to customers across the EU from that single warehouse. The good news? You don’t need to register for VAT in other EU countries, unless you exceed certain distance selling thresholds (though as of 2021, these thresholds have been replaced by a unified €10,000 limit – more on that in the VAT OSS section).

This model is simple and convenient – especially for sellers who are just starting out.

Pan-EU model

The Pan-EU option is designed for sellers looking to scale quickly and efficiently across multiple markets. Amazon automatically distributes your inventory to warehouses in various EU countries based on demand and customer location.

Sounds ideal? It can be – but there’s a catch: every country where Amazon stores your goods requires you to register for VAT and file local VAT returns. This leads to additional administrative duties and often calls for working with accountants or tax advisors who understand international compliance.

What does this look like in practice?

Let’s say you’re a Polish-based seller using the Pan-EU model. Amazon transfers part of your inventory to a warehouse in Italy, from which it’s shipped to Italian customers. In this case:

➜ In Poland, you must report an intra-community supply of goods (WDT) – because the inventory is moving from Poland to another EU country.
➜ In Italy, you’re required to register for VAT and declare an intra-community acquisition (WNT) – since the goods physically arrive in Italy and are sold from there.

Even though the goods haven’t been sold to the final customer at this stage, these internal movements still trigger VAT obligations.

Does it sound complicated? It often is – and rightly so. That’s why, when operating under the Pan-EU model, partnering with an experienced Amazon accounting provider is incredibly valuable. A knowledgeable VAT expert will understand the regulatory landscape and help you translate legal requirements into actionable, country-specific compliance steps.

Intra-community acquisition (WNT) – when goods “cross borders” within the EU

You’re selling through Amazon and suddenly find out that your products were shipped from a warehouse in Germany to Italy before reaching the customer. That’s exactly where WNT – intra-community acquisition of goods – comes into play. Sooner or later, this topic will affect nearly every FBA seller in the EU. And it’s worth knowing how to handle it, so your Amazon VAT compliance doesn’t turn into a confusing accounting puzzle.

When does WNT occur, and what does it mean?

A WNT transaction occurs when goods are transferred from one EU country to another – not as a sale to a customer, but as a movement between your own warehouses (for example, from a warehouse in Poland to one in Germany). In essence, your company is “selling” goods to itself across an internal EU border.

This scenario is very common in Amazon FBA, especially under the Pan-EU model, where Amazon manages logistics and redistributes your inventory across the EU based on demand.

Reverse charge VAT – how does it work?

WNT triggers the obligation to self-assess VAT. What does that mean in practice? In the country where the goods arrive (e.g. Germany), you are required to:

✔ recognize the WNT transaction,
✔ apply the local VAT rate,
✔ report it in your VAT return.

The good news? In most cases – if the goods are used for taxable business activities – you are also entitled to deduct this VAT, which means you don’t pay it out-of-pocket, but rather report it within your VAT return as both output and input tax.

The less convenient part? All of this must be recorded precisely and documented with full accuracy in your accounting system.

Ważne!

Amazon invoices may include VAT from different countries. Always check that the VAT number matches the country of supply – it can affect your right to deduct input VAT in your home country.

What about the location of delivery?

Where the goods are physically located at the moment of delivery to the customer determines where VAT is due. If your products are stored in a specific country and shipped to customers from there, you must be VAT-registered in that country.

Even before a sale occurs, if Amazon has moved your inventory from, say, Poland to Spain, you may already be required to declare a WNT transaction in Spain, even though you haven’t yet sold anything locally.

This is exactly where specialized Amazon accounting services show their true value. A knowledgeable team can not only determine where and how such inventory movements need to be reported, but also integrate this information into your VAT filings across multiple countries, helping you stay compliant on every front.

VAT registration – when and where you need to register

Registering for VAT across multiple EU countries can feel a bit like collecting tax stamps in a passport—just without the excitement of travel. But if you’re selling under the VAT UE Amazon FBA model, this topic is impossible to avoid. While it may seem complex at first, don’t worry—we’ll break it down.

Storing goods in a country? VAT registration is mandatory

The rule is simple: if you store goods in an EU country, you are required to register for VAT there—no exceptions.

That’s why many sellers using the Pan-EU model hold multiple VAT numbers across different member states. Amazon can, often automatically, transfer your inventory to warehouses in countries like the Czech Republic, Spain, or France. Each of these movements comes with specific obligations: local VAT registration and filing according to that country’s tax rules.

It’s a fundamental principle that many new sellers overlook—until their first tax audit.

The good news? A professional Amazon accounting partner can manage all of this for you—from registering your business for VAT, to preparing returns, to handling ongoing filings across every market where you operate.

What about distance selling thresholds?

Before July 2021, each EU country had its own distance selling threshold—typically €35,000 or €100,000 per year. Once this threshold was exceeded, the seller had to register for VAT in that specific country.

Today, a single, harmonized threshold of €10,000 per year applies to total cross-border B2C sales within the EU.

What does that mean in practice? If your annual sales to customers in other EU countries exceed this threshold, you have two options:

➜ Register for VAT in every country where you sell, following the traditional model of local compliance,
➜ Or use the simplified VAT OSS (One Stop Shop) scheme, which allows you to declare and pay VAT for all EU sales through a single return—more on this in the next section.

That said, it’s important to note: if you operate under the Pan-EU model, and Amazon distributes your products across various countries, you’ll still be required to register for VAT in each of those countries—regardless of whether you cross the €10,000 threshold. In this case, the determining factor is not where the sale occurs, but where the goods are physically stored.

VAT filing deadlines? It depends on the country

Each EU member state sets its own rules regarding VAT return frequency and reporting formats. In some countries, returns are submitted monthly; in others, quarterly. Depending on your activity type, you may also need to submit additional reports, such as Intrastat or the EC Sales List.

💡 Some countries require Intrastat reporting even at relatively low turnover levels. This report is separate from VAT returns – and failure to submit it may result in penalties.

What’s more, all these documents must comply with local legal requirements—often in the official language of the respective country. That’s why local expertise or multilingual accounting support is often essential for maintaining compliance.

VAT OSS – a simpler way to handle VAT?

Selling on Amazon in Europe comes with a range of tax obligations, especially when your offer is directed at customers across multiple EU member states. Fortunately, since 1 July 2021, sellers can take advantage of the VAT OSS (One Stop Shop) system – a solution that, in many cases, significantly simplifies Amazon VAT compliance.

What is VAT OSS and what are its benefits?

VAT OSS is a mechanism introduced by the European Union that allows businesses to report and pay VAT on cross-border B2C (business-to-consumer) sales across the EU through a single consolidated VAT return, filed in the seller’s country of establishment.

Rather than registering for VAT separately in each country where you ship goods, you can handle all your VAT obligations using one form. This not only saves time and reduces paperwork, but also provides better control over your VAT reporting and reduces the risk of errors.

For Amazon sellers – especially those operating under the VAT UE Amazon FBA model – using the OSS scheme can be particularly advantageous if you do not store goods in other countries, but simply ship to customers across the EU from your home country.

The €10,000 threshold – when does OSS apply?

You can (or in some cases must) start using the VAT OSS scheme once your total annual cross-border sales to EU countries exceed €10,000. It’s important to note that this limit refers to cumulative EU-wide sales, not the sales to any individual country.

If your sales remain below the €10,000 threshold, you may continue to report VAT under the general rules of your home country. Once you exceed this threshold, you have two options:

➜ Register for VAT in each EU country where you sell, following the traditional country-by-country model,
➜ Or opt into the simplified One Stop Shop system, which allows you to handle all EU VAT reporting centrally through a single return.

That said, keep in mind that if you’re using the Pan-EU FBA model, where Amazon distributes your inventory to multiple countries, you are still required to register for VAT in every country where goods are stored—regardless of your sales volume. In such cases, the critical factor is not where your customers are, but where your inventory is physically located.

VAT OSS and your responsibilities on Amazon

With the introduction of OSS, Amazon sellers have gained access to a simplified reporting method – but also new responsibilities, particularly around price presentation. Amazon requires that the prices displayed on your listings reflect the correct VAT rate for the customer’s country, meaning they must be shown as gross prices (inclusive of VAT).

To meet this requirement, you must ensure that your VAT rates are correctly configured and that you understand the applicable rates in each EU country. While Amazon may calculate and collect VAT at checkout, you remain fully responsible for the correct VAT reporting and remittance.

If you’re using the OSS scheme, accurate and timely VAT reporting becomes even more important. That’s why many sellers choose to work with professionals who specialize in Amazon accounting—experts who understand how the platform works, are up to date with current EU tax regulations, and can help ensure full compliance with all reporting requirements.

VAT accounting – accuracy matters

When selling on Amazon under the FBA model within the European Union, logistics and product strategy are only part of the equation. The other – equally critical – component is precise, well-managed Amazon accounting, which includes not just ongoing VAT reporting, but also thorough documentation of intra-EU transactions.

In the context of international sales, particularly under the VAT UE Amazon FBA model, even minor errors can lead to costly consequences. That’s why it’s essential to understand how to properly manage VAT documentation – and what pitfalls to avoid.

How to document transactions and avoid costly mistakes

Every intra-community acquisition (WNT), every invoice from Amazon, every change in inventory location – all of these must be accurately documented and recorded in accordance with local tax regulations.

For example, in the case of intra-community acquisition of goods (WNT), the seller is responsible for self-assessing VAT in the country where the goods arrive. This transaction must be reported both as output VAT and – provided specific conditions are met – as input VAT eligible for deduction.

What’s crucial is not only reporting the transaction correctly in the VAT return but also maintaining comprehensive and compliant documentation, including proof of movement of goods between EU countries.

Incorrectly recorded values, misassigned dates, or failure to report the transaction entirely can result in the need for corrections – or worse, a tax audit and financial penalties.

Currencies, exchange rates, and dates – common sources of error

Cross-border sales within the EU introduce an additional layer of complexity: multiple currencies and varying rules for currency conversion for VAT purposes. Depending on the country and type of transaction, different dates may determine the applicable exchange rate – such as the invoice date, the delivery date, or the date the tax obligation arises.

Incorrectly identifying the relevant date or applying the wrong exchange rate can not only disrupt Amazon VAT compliance, but also affect the accuracy of financial statements and expose the business to retroactive adjustments.

That’s why careful analysis of dates, exchange rates, and VAT recognition rules is essential – as is a solid understanding of the tax regulations in each EU country where you operate. In this context, the value of working with experienced Amazon accountants cannot be overstated. These professionals understand the intricacies of international e-commerce and can spot potential errors long before the tax authorities do.

Why work with specialized accounting professionals?

While some aspects of accounting can be automated, selling through the FBA model using multiple Amazon warehouses across the EU adds a significant layer of complexity. Constantly evolving regulations, varying VAT rates, and differing registration and reporting requirements across member states demand not only attention to detail but also deep expertise.

That’s why many sellers choose to work with professional accounting partners who specialize in e-commerce and cross-border trade. A comprehensive Amazon accounting service does far more than just file VAT returns. It also:

• monitors regulatory changes across EU jurisdictions,
  • keeps track of reporting deadlines in each country,
  • ensures the accuracy of data submitted to Amazon and tax authorities,
  • and – most importantly – allows you to focus on growing your business, rather than getting lost in compliance formalities.

Selling on Amazon within the European Union offers tremendous growth potential – but it also comes with a fair amount of formalities that are best understood before tax authorities do it for you. If you’re operating under the FBA model, keep in mind: where your goods are stored, where they are shipped, and how they move across borders has a direct impact on your VAT obligations.

To help you stay on top of the key aspects of Amazon VAT compliance, here’s a concise checklist every seller should be familiar with:

✔ Amazon warehouse locations – if your products are stored in more than one EU country, you must have an active VAT registration in each of them.
✔ WNT and WDT – intra-community movements of goods must be carefully recorded in your accounting system and VAT returns.
✔ VAT OSS – once your EU-wide B2C sales exceed €10,000, consider using the One Stop Shop scheme to simplify cross-border VAT reporting.
✔ VAT returns in EU countries – each country has its own VAT rates, deadlines, and reporting requirements. Understanding these differences is essential.
✔ Data accuracy – currencies, exchange rates, transaction dates – precision is key. Even small mistakes can lead to costly corrections.
✔ Professional Amazon accounting – delegate your VAT responsibilities to experts who specialize in e-commerce and understand the complexity of EU regulations.

💡 Use an accounting system that integrates directly with Amazon and can automatically recognize WNT and WDT transactions. This reduces the risk of errors and speeds up your VAT reporting workflow.

Wondering whether your VAT reporting is fully compliant? Or perhaps you’re planning to expand into new EU markets and unsure where to start?

That’s completely normal – EU VAT regulations are complex, and FBA logistics only raise the stakes. The good news? You don’t have to navigate it alone.