Beginner’s Guide to VAT for Sellers

VAT stands for value-added tax. It's a tax based on the consumption of goods and services that is commonly found in the EU and select other regions of the world. Some sellers may be required to charge VAT on the items they sell. However, some tax authorities require Etsy to collect VAT on certain transactions and  remit to the relevant tax authority

VAT is also known as JCT in Japan; GST in New Zealand, Australia, Singapore, and India; QST in Canada; and STT in Malaysia.

VAT may be charged to buyers on their purchases (“VAT on items sold on Etsy”). VAT may be charged to eligible sellers on their paid seller fees ("VAT on seller fees”).

This article contains general information about VAT. You should always contact your local tax authority or tax advisor for more information.

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VAT collected by Etsy

VAT collection on Etsy differs for physical and digital items, and how it works depends on what country you are located in and/or selling to. 

Etsy is required to collect VAT on physical items from buyers in certain countries under some conditions. 

Learn how VAT works on physical items.

If you sell digital items to buyers in certain countries, Etsy is required to charge VAT and remit it to the relevant tax authorities no matter where your shop is located. 

Learn how VAT works on digital items.

Will my buyers be charged import VAT?

When a package ships internationally, the buyer may be required to pay import taxes, customs duties, and/or fees imposed by the destination country. However, Etsy is required to collect and remit VAT on certain sales to Etsy buyers from Etsy sellers, depending on where the goods are being shipped to and from.

Learn how custom fees and import VAT vary by country.

Is VAT collected on my seller fees? 

Depending on your business status and location, Etsy may be required to collect VAT on seller fees accrued each month and remit it to the relevant tax authority.

Learn more about how VAT is collected on seller fees. 

If you’re a seller located in Taiwan, you’ll receive a VAT invoice via email from Taxamo. Learn more about VAT invoices for Taiwan. 

Does Etsy report my sales information to tax authorities?

Etsy is required to collect and remit certain taxpayer information and sales data to the local tax authority in some countries.

Learn about the requirements for shops located in France.

Learn about the requirements for shops located in Italy.

How will my buyers know about VAT?

Buyers will be informed about VAT and any other customs or taxes in several ways. 

Etsy displays information on items in your shop, during the checkout process, and in other relevant places to indicate to buyers when taxes are applicable. 

Learn more about how Etsy will alert your buyer about VAT for their purchases.  

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