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Amazon - VAT and applying discounts

  • 10-12-2022 1:52pm
    Registered Users Posts: 3,721 ✭✭✭

    Spent an hour fruitlessly battling with Amazon Customer Service yesterday over an item I was interested in buying. There is currently 20% off the price of the item in the Amazon Warehouse.

    If I look at an  item in my basket with a UK address it says: Item £786.50; Promotion Applied -£157.30; Order Total £629.20.

    If I look at the item in my basket with an Irish address it says Items £655.42 (which is correct as this is the price of the item with UK VAT removed). Import Fees Deposit £150.75 (this is correct with Irish 23% VAT calculated) and then Promotion Applied £131.08; Order Total £675.09.

    The 20% deduction came from the UK ex-VAT price rather than the total Irish VAT inclusive price of £806.17. 

    Should the correct price not be £806.17 less the UK-VAT discount of £157.30 giving a total of £648.87?

    Or am I completely wrong?


  • Registered Users Posts: 1,297 ✭✭✭walterking

    Amazon apply the VAT rules very strictly. You won't win this unless you can get a declaration from revenue.

    VAT should be applied on the full sales value of goods.

    Amazon are effectively saying that they are giving a goodwill discount and this goodwill discount is not a vatable discount. Its a strange way of doing it and I don't think any other store does it that way.

    How I know about it is that a UK supplier gave me a goodwill gesture after a container of goods arrived far later than they should have. It was regarded as a compensatory payment and therefore vat did not apply. Amazon are effectively treating this as a compensatory payment and vat does not deduct.

    In the UK it is regarded as attached to the goods and vat does apply.

    So its two vat codes treating the same thing differently.

    Personally I think amazon have over thought this.

    Also be very careful that once you go over €150 (full price before any discount), and the goods are made outside the EU or UK, duty will apply and vat on that duty

  • Moderators, Business & Finance Moderators, Sports Moderators Posts: 14,830 Mod ✭✭✭✭whiterebel

    Apparently discounting is accepted by Revenue now. I had to check it out on the revenue website for another thread recently, as discounts hadn’t been allowed previously. It didn’t look quite as complicated as it used to be on the business side oif things either for discount.