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Christmas Approaching Quickly For Ecommerce Sellers
It seems like the Christmas decorations in shops and ‘All I want For Christmas Is You’ are forced upon us earlier and earlier each year. Whilst this is irritating for the general public, who may also think that late September is far too early to be thinking about Christmas, ecommerce sellers need to begin thinking about how they are going to deal with the surge in demand that comes every holiday season now. This year early preparation is even more vital than usual, with experts predicting that online shopping will increase by over 7% this season (which would represent a growth of over 50% on 2019). Here are a few things sellers need to be thinking about leading up to the most wonderful time of the year…
Ensure Your Supply Options Are Ready
Most sellers are forward-thinking enough to increase their inventories before the holiday season to ensure that they can meet the increased demand, but not all of them consider how this increased demand will affect their delivery options. If forecasts are to be believed and this holiday season is once again set to be dominated by online shopping, supply chains and logistic support will be running at full capacity.
Indeed, major logistics providers DHL are already preparing for a 35% increase in volume this holiday season. In addition to this, online marketplaces such as Etsy are already advising sellers to decide on their cut-off point for deliveries so they can ensure all Christmas orders can make it to their destination before the big day. This means as a seller you should be making a list of your delivery methods, and checking them twice to ensure that they will be able to cope with an increase in demand.
Don’t Forget To Account For Returns
You know how it is; at Christmas you might get a present from your secret santa at work who gets the football team you support wrong, or you might buy something for your child, only for them to decide last minute that they never wanted that toy. Scenarios such as these, in addition to the sheer number of purchases always leads to increased returns and refund requests.
This is another aspects of operations that sellers can sometimes neglect. To ensure you keep your customers happy, you must make sure to have a clear and concise returns policy. It is also worth noting that Amazon have extended their returns policy again, meaning that consumers will have until January 31st 2022 to return their unwanted items. This begins on October 1st, so sellers must be aware of these changes before the beginning of next month.
Coronavirus Set To Affect Christmas Once Again
Whilst the effects of the Coronavirus will likely be felt less than they were last year, the last effects from the outbreak will still be prevalent this year. What is interesting is the fact that it is hard to say yet what the impact might be.
On the one hand, a study released by Ebay ads found that 26% of Brits have less disposable income this year as a result of the pandemic, with two-thirds of these people claiming that finding gifts that are good value for money is their priority this year.
On the other hand, the same study found that 20% of Brits have been able to save more this year and are planning to splash their increased savings on Christmas shopping. Over half of these people claimed they plan to spend more on Christmas this year than they did last year. This presents a bit of a dilemma for sellers as it’s hard to know whether to cut prices or hold out for the big spenders. Since there seems to be an even split it might be worth going ahead as planned for now, but sellers should remain flexible and be ready to adapt their listings and products depending on the developments in the market between now and Christmas.
If You Are An Ecommerce Seller, We Can Help You
If you have any concerns about dealing with the upcoming holiday season, we at J&P have the qualifications and knowledge to help you plan ahead, so please do not hesitate to get in touch should you have any further questions about selling on online, or if you need any help with adapting your business. We can get you VAT registered across the EU and can file your returns. Essentially, we sort out your tax so you can deal with selling your products. You can contact us at enquiries@jpaccountant.com, on our social media, or give us a call on 0161 637 1080.
VAT Registration: Is Italy The Next Big Market?
Italy has always presented a strange proposition for ecommerce sellers. On the one hand, it is no secret that the country lags behind some of the bigger ecommerce markets in Europe such as the UK and France. However, it is one of the fastest growing ecommerce markets in the world, with an average growth of 10-20% year-on-year for the last 5 years. With ecommerce in Italy now comfortably worth more than €30 billion, it might be time for you to expand your business to the southern European country. Here’s our guide to Italian ecommerce and how to register for VAT in Italy.
Italy One Of The Fastest Growing Markets In Europe
As stated in the introduction, Italy is one of the fastest growing markets in Europe, along with the likes of Poland, Denmark and Norway. Whilst these other countries also present good opportunities, ecommerce sellers who are looking for opportunities in markets that are about to grow quickly should look no further than Italy.
This is due to the rapid digitalization of the country, coupled with a young population who are increasingly interested in buying their products from abroad. On top of this, the major online marketplaces such as Amazon and Ebay already have a strong presence in Italy, meaning that sellers who use these platforms can expand to the country easily.
What You Should Be Aware Of Before Registering For VAT In Italy
There are a few things to consider before expanding your business to Italy. One is the lack of payment options. Unlike many of the other major ecommerce markets in Europe, Italy is not blessed with many options when it comes to payment options. PayPal is active in Italy, which will come as a relief to many sellers, but UK sellers should be aware that PayPal’s fees are going up for UK-EU transactions as a result of Brexit.
Another consideration is the difficulties in delivering to the remote southern regions of Italy. Whilst delivery is still reasonably simple to these regions, extremely fast delivery may be difficult. This is probably way many Italians seem to distrust logistic providers. This is why it is important that you ensure that your supply chain in Italy will be efficient before committing to selling there.
Finally, don’t forget to ensure that the platform you are selling via uses Italian as its language. Italians much prefer to buy from sellers using there own language, rather than English or Spanish.
The VAT Registration Process In Italy
There is no Italian VAT registration threshold for non-resident traders. So If you wish to sell in Italy you will have to register for VAT. Like many EU countries, you will be required to have a fiscal representative in order to register for VAT in Italy if you are a resident of a non-EU state. This is recommended in Italy anyway, as returns can sometime be complicated if not submitted in Italy. If you require this service, please be aware that we at J&P can act as a fiscal representative in Italy and we are very experienced in dealing with the Italian tax authorities.
The usual information for registering for VAT in a country will be required, such as a letter of authority for the tax representative and the latest audited company accounts. Tax registration is relatively quick in Italy, with the process typically taking a total of 3-6 weeks.
So What Are You Waiting For?
Hopefully this article has provided you with all the information you need to expand your business into Italy. Evidently, VAT registration is an unavoidable step when it comes to expanding your business. Whilst it can be a stressful registration process, we are here to complete the process for you.
Our long history of working with ecommerce sellers, especially those who use Amazon and eBay, means we can guide you through every step of the registration process – so please do not hesitate to send us an e-mail at enquiries@jpaccountant.com or contact us through social media to receive a quote today. In addition to Italy, we would be more than happy to help you register for UK & EU VAT and file your UK & EU VAT returns, and help you comply with VAT in case your account faces any issues.
Ebay Seller Update Autumn 2021: All You Need To Know
The Ebay Seller Update Autumn 2021 was released last week. For the most part, sellers are likely to welcome the changes. The most noteworthy changes have come in the form of multi-user account updates, improvements to Ebay coded coupons and Ebay shops. The update also informed us that ‘Ebay promoted listings advanced’ is set to be rolled out in the UK. All of these changes are worth looking at in closer detail, and you can find the complete update announcement here.
Multi-User Account Changes
Understandably, Ebay sellers have traditionally been reluctant to share their log in details with others. This is usually because this would mean that whoever gained access would have complete control over their listings and account. The Autumn update has meant that from now on, account managers can exert more control over how much responsibility other users of their account can have.
This new feature means that sellers can delegate more tasks to others on their account without having to worry about them causing disruption to the account itself. The permissions that account managers are able to control will now include opening cases, accessing after-sale messages and handling returns. Thus, you could now allow a junior member of your team to revise your listings, but you could make it so they don’t have access to your refund requests.
Updates To Ebay Shops
The Ebay Seller Autumn Update has also promised massive improvements to Ebay Shops. Essentially, Ebay Shops is your online store front. The feature allows you to customise the way in which your buyers interact with your products and also gives you the opportunity to add your own unique branding to make you to stand out from the competition.
It seems as though Ebay are keen to expand the feature, if their new improvements are anything to go by. The changes range from small branding improvements, such as the addition of an ‘About us’ tab which will allow you to tell the story of your brand, to the introduction of new methods to interact with your buyers, such as new newsletter features and the introduction of clickable marketing banners. Sellers would definitely be wise to make the most of these new and exciting features.
The Updates To Coded Coupons
We have covered Ebay coded coupons before. If you have read our previous article on Ebay changes, you will remember that we believed this to be a very exciting edition to the Ebay interface. The updates that have been announced in the Ebay Seller Update Autumn have only served to strengthen our optimism in the usefulness of this feature.
From October 1st, you will now be able to send your coupons directly from your seller hub to specific groups of customers. In addition, Ebay are now making it much easier to track how successful these coupons are by recording the engagement between your coupons and your buyers. To get the most out of this feature, sellers should plan the timings of the coupons carefully, whether that be when your inventory is slightly overstocked, or to offer deals when trying to shift the last few items of an inventory.
The Rebranding Of Promoted Listings & The Introduction Of Promoted Listings Advanced
Not much is changing when it comes to the original form of promoted listings, except from the fact that it will be rebranded to ‘promoted listings standard’. This is in doubt to differentiate it from the introduction of the new promoted listings ‘advanced’.
As opposed to the standard model, where you will still only be charged if someone makes a purchase, the new advanced version of promoted listings means that you will be charged every time someone clicks on your ad. This is a business model known as PPC (Pay-per-click) and may seem strange on the surface. However, the sophisticated system now allows you to ‘bid’ on keywords, much like on a Google search ad. This means that you can show your ads to consumers who are searching for specific keywords.
Whilst this is a more complicated feature and sellers should be tentative to use it if they have no experience in utilising PPC, this represents a massive opportunity for sellers. If you are able to implement this feature properly, you could see your sales and exposure sky-rocket.
We Have A Great Deal Of Experience When It Comes To Supporting Ebay Sellers…
These changes are really indicative of the amount of work Ebay are doing to offer sellers a better selling experience. If you use all the above features to their full potential, you will almost certainly see a considerable increase in sales and profits.
Don’t forget our long history of working with Ebay and Amazon sellers means we can offer you expert advice, so please do not hesitate to give us a call on 0161 637 1080 or send an e-mail to enquiries@jpaccountant.com. We would be more than happy to help you register for UK & EU VAT, the UK VAT deferral scheme, EU and UK EORI number, file your UK & EU VAT returns, and help you comply with VAT in case your account faces any issues. We can even offer storage and warehouse support!
UK Food Industry Takes £2 Billion Hit From Brexit
The UK food and drink industry is about £2 billion worse off than it was before Brexit, new figures have shown. The reports come from the Food & Drink Federation, who have analysed the trade of food and drink between the UK and EU in the first 6 months of 2021. This, of course, coincides with the beginning of the post-Brexit era, since the majority of the Brexit changes came into force on the 1st January 2021. This is obviously worrying news for the food industry as a whole. The UK government are claiming that this is just a temporary drop, but some experts are not so sure.
What Has Been Hit Hardest?
The reports have shown that the worst hit area has been meat and dairy. This is likely due to the strict and often confusing rules surrounding the exportation of products of an animal origin into the EU. Beef in particular has seen exports drop by almost 25%. Other products such as chocolate and cream have also seen a significant drop off.
Aside from the products themselves, it seems that SMEs and family-run business have been hit the hardest. It seems reasonable to assume that this is because these businesses are finding it harder than their bigger counterparts to deal with the new paperwork and customs controls.
It is this paperwork that has caused the most issues since Brexit. The new obligations to document products for trading standards before entering the EU has led to huge delays at customs and ports. It is thought that the food industry is being hit particularly hard due to stringent nature of the health checks. Food exporters now have to provide correct paperwork that confirm products meet physical sanitary and phytosanitary standards, something that was not required before Brexit.
Is Brexit Definitely To Blame?
There are some that believe that the report has been too harsh on Brexit and has not placed enough significance on the affects of the pandemic on trade. It is undeniable that the coronavirus outbreak has caused massive disruption to supply chains and will have undoubtedly changed consumer habits. While this is true, it is clear that Brexit is the main contributing factor to the issues facing the UK food industry.
As mentioned earlier, Beef exports have dropped by about a quarter. This is in comparison to the same period in 2020. However, they have dropped by almost 40% compared to the same period in 2019. So whilst trade was clearly disrupted by the outbreak in early 2020, it seems that more severe drop we are seeing this year points more towards Brexit as the cause for the trade disruption.
What Can Exporters Do?
Many exporters have complained about the detrimental affect the Brexit red tape is having on their operations. This has led many UK businesses to move a portion, if not all, of their operations to the EU in order to continue trading freely within the EU. This means the loss of trade and jobs for the UK, which was supposedly the exact opposite of what those who voted Brexit wanted.
Whilst this may be an option for bigger companies, for smaller companies this is unlikely to be an option. For smaller businesses, the best options seems to be to re-evaluate their supply chains and make sure they are as compliant as possible. There is advice out there about dealing with customs after Brexit (like in our article here) and there is always the option of appointing a customs agent. Whilst this would come at an expense, it would likely be cost-effective in the long run.
How Can J&P Help Exporters Post-Brexit?
If you are a business who participates in cross border e-commerce, or exporting of any kind, we would be more than happy to help you register for UK VAT, the UK VAT deferral scheme, gain an EU and UK EORI number, file your UK and EU VAT returns, and help you comply with VAT in case your account faces any issues. At J&P, helping your business is our passion, and we understand that companies across the UK are at risk now more than ever. We are here to support you through Brexit, so please do not hesitate to give us a call on 0161 637 1080 or send an e-mail to enquiries@jpaccountant.com.
How To Complete VAT Registration In Spain
Regular readers of our articles will be aware that we have done a handful of guides for VAT registration in various countries. This time we’re going to be looking at VAT registration in the 9th biggest country in the world – Spain. Ecommerce in Spain is currently worth in excess of €30 billion and over 60% of the population use the internet. With such an enticing ecommerce market, it is no surprise that it is one of the most popular countries for sellers to expand their business. However, to do so they have to register for VAT in Spain. Here’s our guide on how to do just that…
When Do I Need To Register For VAT In Spain?
Like many EU countries, you need to register for VAT in Spain if you make any taxable sales or supply any services in the country. However, what is unusual about Spain is that you cannot register for VAT voluntarily. You have to already have made taxable sales of goods or services and then retrospectively pay VAT on those sales.
You must also register for VAT if you hold any stock in Spain. There is no call-off stock simplification in Spain, so you must also register for VAT when holding stock in Spain even if it is a intra-community transaction. The only time this doesn’t apply is if the consumer is considered the de facto owner of the goods.
What Will I Need For The Spanish VAT Registration Process?
When completing the process for registering for VAT in Spain, it is first worth noting that the application must completed in Spanish. In terms of supporting documents you will need, please be prepared to submit:
- A Memorandum and Articles of Association
- A certificate procured from your company’s country of residence which discloses the address of your company and a list of the directors
- A Power of Attorney form, this will be provided by your tax agent (such as ourselves) and informs the tax authorities that this agent can obtain the Spanish tax code on your behalf.
It is also very important to note that you will need to appoint a fiscal representative in Spain. Fiscal representatives are responsible for the accurate VAT submissions of their non-EU clients. If you use J&P to facilitate your Spanish VAT registration we can act as your fiscal representative.
What Does The Spanish VAT Number Look Like?
Typically, the code is a block of 9 characters that is proceeded by the prefix ES. Depending on your business operations this can sometimes vary slightly, but this is the general format and they will all begin with ES.
Once obtained, you should use this code like any other tax code. The code must be used to identify yourself when dealing with the tax authority and must be quoted on all relevant documents (customs forms, VAT return submission etc.).
Can I Postpone VAT In Spain?
The short answer is yes. One of the best things about conducting business in Spain is the fact that you can take advantage of their postponed import VAT accounting scheme. Whilst you would normally have to wait until the VAT return is filed before deducting VAT, the postponed import VAT system allows you to pay and deduct the VAT in the same VAT return. This fundamentally acts as a reverse charge mechanism on import VAT.
However, there is a catch. This system is only available to businesses with turnover that exceeds €6 million and who file monthly VAT returns. There is also the formality that to benefit from postponed import VAT, you must submit the application in November of the year before you wish to benefit from the scheme.
Conclusion
Evidently, VAT registration is an unavoidable step when it comes to expanding your business. Whilst it can be a stressful registration process, we are here to complete the process for you.
Our long history of working with ecommerce sellers, especially those who use Amazon and eBay, means we can guide you through every step of the registration process – so please do not hesitate to send us an e-mail at enquiries@jpaccountant.com or contact us through social media to receive a quote today. In addition, we would be more than happy to help you register for UK & EU VAT and file your UK & EU VAT returns, and help you comply with VAT in case your account faces any issues.
National Insurance Increase Imminent
If recent reports are to be believed, Boris Johnson is set to announce an increase of 1-2% to national insurance payments, despite this being a direct contradiction to the promises made in the 2019 Tory manifesto. It is believed the plans will be announced next week, but there is still uncertainty as to whether the increase will come in the form of 1% or 2%. But why are the government raising taxes? Who will be affected? Let’s find out…
Why The Government Wants To Raise National Insurance
It seems that the Tories are planning to raise the tax in order to grant the NHS extra funding and to finally address the issues with social care funding. It is thought that the NHS needs at least an extra £10 billion in funding. As things stand, the government had planned to increase funding by £5 billion, which is clearly not enough.
Should the increase in national insurance get introduced, it is thought that a 1% raise would bring the government an extra £10 billion a year. This would cover the extra budget being afforded to the NHS, as well as offering more funding to social care. It is estimated that 1.5 million people in England alone do not get the care that they need and can pay up to £100,000 of their own money on social care, a figure that is not supposed to exceed £50,000.
Who Would Be Affected?
Of course, anyone who pays national insurance will be affected, and this constitutes the majority of the population. Self-employed people pay the tax on their profits, and those who are employed pay it on any earnings over £9,568 a year. As the income tax threshold is the same (12%) up to earnings of £50,000, there is a worry that this will mean the tax hike would affect younger people and low earners more than anyone else. For someone on average earnings of £29,536 a year, a 1% increase in national insurance would cost them £199.68 annually, according to the BBC.
On the other hand, those who rely on social care and the NHS would obviously stand to benefit. The fees that local authorities pay for care are varied across the country, but it is thought that over 1.5 million people don’t get sufficient support. This is partly due to the lack of funding but also due to staff shortages. In this sector, it is thought that there are 45,000 vacancies across the UK.
How Do Employers Pay National Insurance?
National insurance is contributed to by both the employee and the employer, but it is up to the employer to ensure that HMRC receives the tax payments. This can be done a variety of ways (post, direct debit etc.). You can find out more about more about the rates that should be paid on the GOV website.
The system by which employers have to pay tax on their employee’s earnings is called PAYE. This can be paid yearly or quarterly but must be paid to HMRC by the given deadlines. Failure to do so can result in additional charges and penalties.
Can We Help?
At J&P, we provide full payroll and PAYE support. Our experienced specialists are experts in calculating and recording pay, pension, income tax and national insurance and we submit this data to HMRC so that you don’t have to. Our payroll service includes complete payroll management and PAYE implementation.
We work efficiently and flexibly to suit every company’s needs and we always strive to deliver the best service possible. We would be more than happy to assist with your payroll management and implement PAYE into your payslips, so get in contact today via enquiries@jpaccountant.com, or gives us a call on 0161 637 1080.
