Value Added Tax (VAT) is applied to various goods and services in the UK, and this also includes digital products and subscriptions. With the increasing popularity of streaming services, and the Amazon next day delivery option, we’ve recently been asked whether VAT is charged Amazon Prime charges and the subscription service.
The simple answer is, yes, there is VAT on Amazon Prime. Amazon’s policy clearly states that VAT is applied to UK Amazon Prime subscriptions and will be at the current UK VAT rate. For UK consumers this means that UK-based subscribers of Amazon Prime will have the local 20% VAT rate included in their membership fees which is renewed annually.
If you are a business that needs a VAT invoice for an Amazon Prime subscription, we’ve been made aware that many customers have reported difficulty in getting these invoices.
In this guide, we will explain how the Amazon Prime VAT invoice works, and how to get an Amazon Prime VAT invoice from your account.
An overview of UK VAT and Amazon Prime
The current UK VAT rate is 20%, which applies to most goods and services, including digital products and services such as Amazon Prime membership charges. Amazon.co.uk is required by law to charge VAT on sales of digital products and services to customers in the UK and the EU (Amazon VAT information).
However, we have seen some online reports that suggest Amazon do not make it easy get VAT invoices for Prime memberships. This poses challenges for small businesses looking to claim VAT refunds on their Amazon Prime membership costs, where their membership is used to get next day delivery on purchased items.
How to get a VAT invoice on an Amazon Prime subscription
Business customers may request a VAT invoice for their Amazon Prime membership. Although Amazon may initially provide a receipt indicating the inclusion of the 20% VAT, in the past, the company made it difficult to get a VAT invoice.
However, this does now appear to have changed.
- Mouseover “Account & Lists” in the top navigation bar of Amazon.co.uk.
- Click “Your Account”.
- Click “Prime”.
- Click “Update your payment method”.
- Click “View all printable receipts”.
In conclusion, VAT is applicable to Amazon Prime memberships in the UK at a rate of 20%. Customers should be aware of this fact, and businesses should ensure that they obtain a VAT invoice if required for their records.
VAT and Amazon
Is Amazon Prime zero-rated for VAT?
No, Amazon Prime is not zero-rated for VAT, and has the standard VAT rate of 20% applied to it. However, there are a few zero-rated products you can buy with Amazon which are exempt from VAT. These include things like books, magazines, and newspapers.
How to get a VAT invoice from Amazon
Click into your account, and then “orders”. Search for the item you purchased, and you will see “invoice”, click that and it will show a drop down letting you choose to download an invoice which will have VAT details in it.
Other VAT questions for small businesses
Jon has been in business since 1999, and in that time worked with more than 300 small business clients. As well as being an accountant, he is also an early adopter of tech, and has helped small businesses to leverage the power of their computer systems by creating software to automate and simplify accounting tasks.
