Marketplace Tax Responsibility

What is Marketplace Tax Responsibility?

In some countries there has been a change to the taxation law which means that the retailer is no longer responsible for the remittance of sales tax / VAT to that country where the sale is made on a marketplace and is an import into that country.

The marketplace instead charges sales tax/VAT on the order and remits it under their tax registration for that country, and thus handles the tax responsibility for the retailer. It allows retailers to trade to these countries more easily.

The retailer will no longer collect and remit sales tax for these countries for their import sales on IGOAL, however the retailer remains responsible for the remittance of sales tax/VAT for any sale they make on their own site or via other methods that are not a marketplace.

Where is it applicable?

In the countries which IGOAL is available, there are currently five countries/areas which operate Marketplace Tax Responsibility. These are:

  • United Kingdom
  • Australia
  • New Zealand
  • Norway
  • European Union
  • United States of America

In all the above countries and areas, marketplace tax only applies to import sales from retailers not domiciled in that country. If you are domiciled in the country marketplace tax does not allow and you will remain responsible for the remittance of sale tax/VAT.

Does it apply to all orders?

  • In Australia, New Zealand & Norway IGOAL will apply the sales tax applicable to the classification of the product in these countries irrespective of the order value.
  • In the United Kingdom and the European Union, the marketplace (IGOAL) is only responsible for orders up to £135 / €150. For any order above £135 / €150 normal border rules apply where either the retailer pays tax & duties or the customer will pay these at the border.
  • In United States of America IGOAL will apply the sales tax applicable to the classification of the product in that specific state. Not applicable in all states.

Do I need to change my pricing?

  • You will not need to make changes to your product pricing for these countries.
  • IGOAL will apply the relevant sales tax rate on top of the product prices you provide where marketplace tax is applicable.
  • The combined product price will be the price that displays on the product once converted by IGOAL to the local currency of the site.
  • You will receive and see the same order totals to match the prices you provide. These will be excluding marketplace tax.

What do I need to do?

  • As a seller you will still need to provide the documentation required for international shipments.
  • You will need to document that IGOAL has collected the sales tax on your customs declaration and consignment with their courier, including IGOAL’s relevant tax IDs (where applicable).
  • Ideally you should include the IGOAL invoice/packing slip in the parcel and stick it on the outside of the parcel where possible.

These consignments should be fast-tracked through customs with the correct documentation and you have indicated VAT has been pre-paid with IGOAL’s tax IDs.

If the IGOAL Tax ID is not present on the package, the recipient will likely need to pay import sales tax to receive the order, even though IGOAL has collected tax at the time of purchase. If the customer requests a tax refund from IGOAL or refuses delivery because the package wasn’t correctly labelled, we will issue the customer a refund and pass the cost onto the retailer.