Tag Archives: Taxes

The “Virus of Amazon”, Over-Eager Suspension Escalation and Australian Expansion

The seller waging war on their rival, the retail shark moving in for the kill in Australia and the angry sellers sending half-baked escalation emails.

This post is by Chris McCabe, a former Investigation Specialist for Amazon’s Seller Performance team and founder of ecommerceChris.com. ecommerceChris shows Amazon sellers how to keep their accounts healthy, or, if the worst should happen, how to get their account back from a suspension.

The majority of Amazon sellers will tell you that selling on marketplaces is a cutthroat world, but one seller has taken this to heart. This self-proclaimed “virus of Amazon” has almost driven the seller of a number one product out of business.

Change is afoot in Australia, as some sellers have reportedly been involved in initial testing for Amazon’s latest expansion. While consumers are jumping for joy at the prospect of lower prices and wider selection, existing retailers are worried about the impact that the retail giant’s arrival could have.

In the world of suspensions, sellers are firing escalation emails off to Jeff Bezos and the Executive Seller Relations team too quickly, without solid a Plan of Action. The end result? A deeper hole to get themselves out of.

Meanwhile, the sales tax saga rages on, as South Carolina take legal action against Amazon directly, while other states continue to send audit letters to third-party marketplace sellers.

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Financial Management Made Easy: Tools and Services For Online Sellers

Managing your finances can be a nightmare. These tools and services reduce headaches, increase accuracy and help find new opportunities.

Very often, marketplace sellers focus on the more exciting parts of their business, like product sourcing, and shy away from areas that they find boring, or difficult, like managing their finances.

This can be counterproductive, because no matter how you feel about getting your finances in order, it’s a necessary part of running any business. It’s a discipline that sellers need to embrace, and become proficient at, so they really understand the numbers that matter.

You don’t have to spend hours in Excel to keep on top of your record keeping and accounts. There are tools and services specifically made to help manage bookkeeping for ecommerce businesses. These help make the process more efficient, while also minimizing the risk of errors.

There are also tools that produce reports to help you see how your business is doing. It’s easy to lose sight of the bigger picture when you are busy all day dealing with suppliers, listing products and providing customer support. But being able to see how profitable you are, at any time and at any level of detail, is crucial to business success.

Expanding into new product lines, or increasing purchase levels to get better discounts, can also make a big difference to your business. Some sellers choose to take out loans, or use other cash flow solutions, so they can take advantage of new opportunities when they present themselves, or plan for the seasonal ups-and-downs of ecommerce.

In this post I’ll walk you through the Financial Management category of the Web Retailer directory. It covers Cash Flow and Loans, Accounting Connectors, Ecommerce Accounting and Sales Tax and VAT.

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Sales Tax and Amazon FBA: Have We All Been Getting It Wrong?

Alex Knight interviews attorney Paul Rafelson about US sales tax for Amazon FBA sellers, and the MTC’s amnesty. Should you opt in?

As you may have seen, sales tax is a rather hot topic for Amazon sellers at the moment, following the Multistate Tax Commission’s decision to hold a US sales tax amnesty for online sellers.

With the October 17th deadline looming, there is much debate about whether Amazon sellers are even liable for sales tax, and whether they should make a voluntary disclosure under this amnesty. This week, I spoke to Paul Rafelson, a state and local tax attorney, to get his opinions on both of these topics.

What Paul said surprised me, as it was very different to the orthodox view of FBA and sales tax. Ultimately, he believes that Amazon sellers who fulfill their orders using FBA may not be liable for sales tax at all. His contention is that sales tax “nexus”, usually the key consideration for Amazon FBA sellers, is actually irrelevant, because Amazon itself is the “retailer” under sales tax law and should be responsible for collecting sales tax themselves.

We also talked about the MTC amnesty, which Paul believes Amazon sellers should not comply with because, in his opinion, it is a bad policy, based on a weak understanding of the realities of selling on Amazon. He also fears that if sellers comply, they could be hit with further taxes, such as income tax and franchise tax, and end up crippled by a huge compliance burden.

You can watch the full interview with Paul above, and we’ve also included a full transcript of the conversation.

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Selling on Amazon in the EU? Your VAT Obligations Explained

Claire Taylor demystifies Amazon’s European fulfillment options and their VAT implications – including the new Pan-European FBA

This post is by Claire Taylor, CEO of SimplyVAT.com – a company which helps ecommerce businesses trade across borders in compliance with complex European VAT legislation.

Amazon is steadily implementing its amazing vision to be the greatest online shopping marketplace for millions of customers across Europe. It now offers access to EU customers through five marketplaces: Germany, UK, Spain, Italy and France. It has 31 distribution centers in seven countries and is constantly looking to increase this number.

Amazon wants its sellers to access the huge mature ecommerce market within the EU, which last year grew 12% to a staggering €500 billion. There are 96 million online shoppers in the EU spending an average of €1,500 per year. It’s a great opportunity for sellers to access new markets, increase profits and ensure sustainable online retail businesses!

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Sales Tax Nexus for Online Sellers: Amazon FBA, 3PLs and More

This post is by Mark Faggiano, Founder and CEO of TaxJar, a service that helps more than 5,000 online sellers with sales tax calculation, reporting and filing. TaxJar offers a free 30-day trial.

If you are an online seller in the USA, you’re probably well aware that you are required to collect sales tax from buyers in your home state. But, as with just about anything to do with tax, it gets a little more complicated than that.

This post provides the fundamentals for sales tax nexus for online sellers, including what creates nexus, and what that means when it comes to collecting sales tax from your customers.

It covers the impact of using Amazon FBA (and other third-party fulfillment services) on sales tax nexus, how to determine whether a fulfillment service gives you nexus, and what to do if it does.

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