What Does an Amazon Accountant Do? A Clear Guide for UK Amazon Sellers

Selling on Amazon is no longer just about listing products and waiting for sales. With fees, VAT, international rules, and constant data coming from Seller Central, Amazon businesses can quickly become financially messy without the right support. That’s where an Amazon accountant comes in.

Whether you sell via FBA, FBM, or both, operate in the UK only or across Europe and beyond, an Amazon accountant helps you understand your numbers, stay compliant, and grow profitably without nasty surprises from HMRC or Amazon.

Why Amazon Sellers Need Specialist Accounting Support

Amazon businesses are very different from traditional businesses. Amazon collects money, deducts fees, handles VAT in certain cases, and moves stock across borders automatically. Without specialist knowledge, it’s easy to misunderstand your real profits or miss important tax obligations.

An Amazon accountant understands how Seller Central works, how Amazon fees affect margins, and how VAT, customs, and tax reporting fit together. This allows you to make better decisions, price products correctly, and avoid costly compliance mistakes.

From a tax perspective, Amazon profits are taxed differently depending on how your business is structured. Sole traders and partnerships pay Income Tax at 20%, 40%, or 45%, plus Class 2 and Class 4 National Insurance, once profits exceed the £12,570 personal allowance. Limited companies pay Corporation Tax at 19% on profits up to £50,000, rising to 25% on profits above £250,000, with marginal relief in between. Understanding this difference is critical when deciding how to operate and scale your Amazon business.

Understanding Amazon FBA and FBM from an Accounting Perspective

With Fulfilled by Amazon (FBA), Amazon stores, packs, and ships your products, often moving stock between warehouses automatically, including across borders. While convenient, this creates VAT and reporting complications many sellers are unaware of.

With Fulfilled by Merchant (FBM), you control fulfilment, which can simplify some VAT issues but still requires careful tracking of income, expenses, and international sales.

From an accounting perspective, both models require accurate reconciliation of Amazon payouts, correct VAT treatment, and proper tracking of stock and fees to ensure your accounts reflect reality, not just Amazon’s dashboard.

VAT for Amazon Sellers in the UK

UK Amazon sellers must register for VAT once taxable turnover exceeds £90,000 in a rolling 12-month period. However, many sellers are required to register earlier due to Amazon fulfilment arrangements, overseas storage, or importing goods into the UK. Registering late can result in backdated VAT bills, penalties, and interest.

VAT is one of the biggest problem areas for Amazon sellers. Amazon may collect and remit VAT on certain sales, but that does not remove your responsibility to understand what should be reported on your VAT return.

UK Amazon sellers must consider:

• When VAT registration is required

• How Amazon fees are treated for VAT

• How refunds, reimbursements, and chargebacks affect VAT

• Whether Amazon’s VAT calculations align with your filings

Mistakes here can lead to underpaid VAT, penalties, or HMRC enquiries. A specialist Amazon accountant ensures your VAT returns match both Amazon data and HMRC requirements.

IOSS, OSS, and the Complex Reality of EU VAT for Amazon Sellers

For Amazon sellers trading with EU customers, VAT does not stop at the UK border. Since Brexit, selling into the EU has become significantly more complex, particularly for FBA sellers and those shipping directly to European customers.

The Import One Stop Shop (IOSS) applies when goods worth €150 or less are sold to EU customers and shipped from outside the EU, such as from the UK. When used correctly, VAT is charged at checkout and reported through a single monthly IOSS return. This helps avoid surprise VAT bills for customers and delays at customs. If set up incorrectly, however, sellers can face double taxation, delayed deliveries, or blocked shipments.

The One Stop Shop (OSS) applies where goods are stored within the EU or where distance selling thresholds of €10,000 per year are exceeded. Instead of registering for VAT in every EU country, OSS allows sellers to report EU VAT through one quarterly return. While this simplifies reporting in theory, Amazon stock movements, differing VAT rates, and local compliance rules make this extremely complex in practice.

An Amazon accountant ensures IOSS and OSS are applied correctly, EU VAT is charged at the correct rate, and all filings are accurate. Getting this wrong can result in penalties, backdated VAT assessments, or even Amazon account restrictions.

International Amazon Sales and Tax Considerations

Many Amazon sellers expand internationally without realising the tax consequences. Selling in the EU, US, or other regions can create permanent establishment risks, additional tax filings, and foreign VAT or sales tax obligations.

An Amazon accountant helps you understand where you are exposed, what needs registering, and how to expand in a controlled, compliant way rather than reacting after problems arise.

Reporting, Record Keeping, and Amazon Data

Amazon provides vast amounts of data, but it is not accounting-ready. Settlement reports, fee breakdowns, refunds, and inventory adjustments all need to be correctly interpreted and reconciled.

Accurate records are essential for:

• Self Assessment or Corporation Tax returns

• VAT returns

• Profitability analysis

• Future planning and scaling

Using specialist ecommerce and Amazon accounting software allows transactions to be tracked accurately, reduces manual errors, and ensures figures align with HMRC rules.

Why This Matters for Amazon Sellers

Amazon businesses can grow very quickly, but without clear financial visibility, growth can hide problems rather than solve them. Understanding your true profit, tax position, and cash flow allows you to reinvest confidently, expand internationally, and avoid unexpected tax bills.

Whether you are a sole trader just starting out, a limited company scaling rapidly, or an established Amazon seller operating across multiple countries, the right accounting support gives you clarity and control.

How We Help Amazon Sellers

At LT Accounting, we specialise in supporting Amazon sellers across both FBA and FBM models. We don’t just advise Amazon businesses, we’ve run ecommerce businesses and sold on Amazon ourselves, so we understand the platform from the inside out. We work with UK-based ecommerce sellers trading domestically and internationally, ensuring accounts are accurate, VAT is compliant, and tax is planned efficiently as businesses scale.

We help by reconciling Amazon settlements, handling UK and EU VAT (including IOSS and OSS), preparing Self Assessment or Corporation Tax returns, and advising on structure, growth, and international expansion. Because we understand Amazon Seller Central, fees, payouts, and stock movements in real-world terms, we focus on practical, commercial advice, not theory. Most importantly, we explain everything in clear, plain English, so you always know where you stand and can make confident decisions about your business.

Final Thoughts: Build a Profitable Amazon Business on Solid Financial Foundations

Amazon is an incredible platform, but it comes with complex financial and tax responsibilities. With the right accountant, those complexities become manageable, and your business becomes easier to scale.

If you sell on Amazon and want clarity, compliance, and confidence in your numbers, get in touch with LT Accounting today. We’ll help you turn Amazon sales into sustainable, long-term success.