VAT on second hand items – eBay

We’ve just sold a second hand sofa on eBay and got charged 20% VAT. I didn’t think that VAT was chargeable on second hand goods if you are a private seller – have I missed something?

Thanks for any advice
Woody

Charged vat on what by who? Do you mean the fees you paid to eBay included vat? That’s vat on the price of the service they provide to you not vat charged by you to the buyer of a sofa

Isn’t it just that you’ve been charged VAT on the ebay fees not on the actual sale of the sofa?

Vat at 20% is removed from the total sale value in addition to the eBay fee. eBay collect and I guess pass onto HMRC

Are you in the uk?

Ah I think I may have worked it out. Fees are a bit higher than expected (10% or so) and then you pay VAT on the fees

That’ll learn me

The buyer should pay 16.67% of any margin, so if the sofa sold for more than it’s original value (and that could be estimated by eBay) that margin is VATable. If it’s an antique or 30year old junk sorry vintage you’ll have possibly quite a chunk to pay vat on. (Unless you’re over threshold so vat registered, then it’s 20% of value)

As seller you* shouldn’t pay anything.

*Though it’ll come out of any funds you received generally as the normal way for vat to be paid is ontop of the purchase price to seller then funds to the Exchequer is by the seller.

The fees can be pretty high. You’ll easily get them covered by the extra amount you make selling via eBay but it’s still a stinger. Well worth saving up higher value items for a discount fees weekend. They come around pretty often, in fact there’s one this weekend.

Not that it seems to applies here but I think you can pay VAT on second hand goods. I’ve seen vans listed as either + VAT or VAT included.

Not that it seems to applies here but I think you can pay VAT on second hand goods. I’ve seen vans listed as either + VAT or VAT included.

Only if the vendor is vat registered (which a lot of trade / self employed van owners will be)  – in which case anything the sell has VAT added to any transactions they make

Even then, not strictly true, it’s only payable on the full sale value if the vat had been reclaimed initially, so a VAT registered seller (dealer) can sell a non vat reclaimed vehicle (from a not vat reg builder) without 20% final value vat on it in some instances, instead only paying 16.67% vat on margin.
This is why at the same dealer you’ll see some vehicles +vat and some not.

FYI – eBay do offers every few weeks or so where the fees are much reduced (think it was 80% last weekend and 70% this weekend). Realise a bit late now but next time you sell anything of higher value it obviously makes a big difference.

Second hand doesn’t mean no VAT is due. Private seller who isn’t VAT registered does. Though VAT will be due on service fees and postage which I guess is the case here.

If VAT registered trader, some second hand items can qualify for VAT margin scheme (as in VAT on the profit margin).

Imports are another matter. The buyer can still get charged VAT and duty on import to UK even if it’s a second hand item (even if it was originally bought in UK, went abroad, then you bought it from someone abroad). That’s charged by HMRC or courier though usually.

Also, that you as the seller got charged VAT would indicate it’s the seller fees. You wouldn’t pay VAT on the item you’re selling, even if you were VAT registered. They buyer would (then seller passes that on to HMRC).