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In the blink of an eye, the second month of 2024 has come to an end. Many sellers have not yet fully adapted to the market changes of the previous year, but the implementation time of various new policies in the industry has come one after another. Recently, according to the feedback from sellers, based on the relevant tax policy requirements in Europe, Amazon seems to have strengthened the tax compliance review of accounts. It is learned that recently, a large number of European sellers received warning emails from Amazon about funds being reserved. Amazon stated in the email that due to EU/UK business establishment requirements, another Amazon account of the relevant seller was under review, so the funds in the relevant seller's account had been set as a reserve. Because the email was released suddenly, many sellers were caught off guard and confused: "I only have one Amazon account, how can I have another one to link to the review?" "How did Amazon find the nexus? Is this considered a tax nexus?" "This is probably caused by the tax issues related to the European mainland ship." It is observed that most of the sellers who received the email are sellers with local European accounts such as the UK and France. Therefore, many sellers speculated that the email was related to the tax refund wave that broke out on Amazon a few years ago. It is understood that in mid-to-late January this year, a large number of local European accounts received tax payment notices from Amazon. The main issues involved were failure to declare or under-declaration, and the local companies in the background were in a cancelled status, and the account funds were therefore frozen. At that time, Amazon UK also issued an announcement on the incident, stating that this move was the implementation of the new UK VAT (value added tax) policy. During the tax inspection process, the funds in the seller's account may be temporarily frozen. Among the sellers who received this email, some of their accounts are among the accounts that received tax payment notices. However, at the same time, due to the wide range of Amazon's mass emails, many sellers believe that Amazon's operation is actually a misjudgment: “My account is not a local account, but funds have also been reserved.” “Amazon has a bug again.” As of press time, most of the convicted associated accounts have been automatically unblocked and the reserved funds have been cancelled. But it is worth noting that Amazon has not yet issued an announcement to explain the reason for this incident. Therefore, this email still sounded the alarm for tax compliance for many cross-border sellers in the European market. It is understood that tax audits have always been a key concern in the European market. In the past, due to the complicated VAT registration process in the UK, many Amazon sellers chose to register for VAT through tax agents. However, as Amazon's VAT withholding policy became stricter, incidents such as account failures due to uneven service providers have emerged one after another. After Amazon implemented withholding VAT in September 2023, the platform's European site has already experienced three rounds of tax inspections, in September, November 2023 and January 2024. At that time, a large number of local accounts of sellers on the UK site were frozen due to irregular registration of local companies in the background, and they had to pay high tax amounts before they could resume operations. This news is enough to show that with the changes in European tax policies, the platform's tax compliance review of accounts is becoming more stringent. In addition, it is worth noting that at the beginning of the new year, the UK Revenue and Customs (HMRC) also issued a new tax regulation: from January 1, 2024, e-commerce platforms operating in the UK (including Vinted, Etsy and eBay, etc.) must submit to HMRC every year the income information of sellers on their platform such as personal services, sales of tangible goods, real estate or vehicle rental, etc. eBay also announced the new regulations to sellers on the UK site, saying that the new tax regulations apply to new accounts registered in 2024 and sellers who reach any of the following sales thresholds on eBay by 2025. From January 2025, eBay will report the previous year's information to HMRC in January each year and provide sellers with a copy of the reported data. This means that in addition to Amazon, sellers on platforms such as Vinted, Etsy and eBay in the UK will also be subject to stricter tax compliance reviews. For cross-border sellers, it is even more necessary to abide by relevant laws and regulations and eliminate tax loopholes. What do you think about this? Welcome to discuss in the comment area~ In recent years, cross-border e-commerce platforms have emerged one after another, and Temu has successfully occupied a leading position in the overseas market by relying on its extreme cost-effectiveness + social fission. It is known as one of the "Four Little Dragons Going Overseas", but there are still many seller friends who have never really come into contact with this platform. The 2024 Duoduo Cross-border Temu Investment Conference aims to help these sellers expand this cross-border "new force ". Through this conference, more sellers can understand the cutting-edge knowledge of the Temu platform and look forward to development trends.
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