Amazon FBA Sellers: Getting Stock Valuation and VAT Right
Updated: Oct 24
Why Amazon FBA accounting trips up so many sellers
We see two issues come up again and again with FBA clients: getting year-end stock valuation wrong, and getting the VAT treatment of Amazon's own fees wrong.
The stock valuation problem
Inventory can sit in multiple fulfilment centres at once, sometimes in different countries. Sellers often fail to properly value stock in UK centres, EU centres, stock in transit, and stock marked as damaged or lost.
The VAT problem: fees, reverse charge, and registration thresholds
Many Amazon fees fall under the reverse charge mechanism, meaning the seller has to account for VAT on their own return. FBA sellers also need to watch UK and EU registration thresholds — storing stock overseas can trigger a registration requirement there.
Getting it right
Reconcile Amazon's stock reports against your accounting records by location
Build a clear process for valuing stock in transit and overseas
Review every category of Amazon fee for reverse charge VAT
Track where you hold stock against UK and EU VAT thresholds
FAQ
Do I need to register for VAT in every EU country Amazon stores my stock in? Not automatically, but it needs checking country-by-country.
Is Amazon responsible for getting my VAT right? No — responsibility sits with you as the seller.
What happens if I've got this wrong for a while? Address it sooner rather than later.
If your Amazon accounts need a proper health check, get in touch with Jackson Lee (https://www.jacksonleeaccountants.co.uk/contact-me).
Need a hand with this? We're accountants in Bury, and our VAT and Making Tax Digital service covers it for a fixed fee.
Talk it through with us
If this affects you, book a free, no-obligation 30-minute chat by phone, Teams or at our Bury office, or see your fixed fee online in 2 minutes. Prefer to talk now? Call 0161 327 0047.
Sources: Taxity: Amazon FBA accounting guide (https://www.taxity.co.uk/blog/amazon-fba-accounting-uk-complete-guide-for-sellers-2026-taxity/) · Social Commerce Accountants: Amazon FBA VAT guide (https://www.socialcommerceaccountants.com/blog/amazon-fba-vat-guide-uk)
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