Regardless of whether your business is VAT registered or not, you may need to be aware of the following important information regarding VAT on sales of children’s items to other countries.
Icephorm are not VAT and Duty experts but we have taken professional advice in relation to our responsibilities. However, this information is only given to guide our sellers who should take independent advice to ensure that they understand and meet all official rules that govern their trading.
The majority of European nations charge standard rate VAT on children’s clothing but there are exceptions: Ireland (0%), Luxembourg (3%) and the United Kingdom (0%).
Where standard rate VAT is not charged, there are detailed rules that govern which items are permitted to be sold at the zero or reduced rate. These rules are available online on the websites of the relevant national revenue collection authorities. In some circumstances, children’s accessories also qualify for reduced VAT, for example bibs and gloves.
To assist with this, Icephorm includes a tick box for each of these three countries in the Pricing & VAT section of the Listings page of the various ‘Childrens’ categories. By ticking these, you are confirming that ALL the items listed (not just some) conform to the particular country’s rules and therefore qualify for sale at the lower, children’s clothing VAT rate. Items being sold to countries that you have not confirmed will be promoted and sold at standard rate VAT.
If you have already listed items, it may be worth reviewing them with these points in mind.
Considerations
Bear in mind that when selling an item with a range of variants (such as different ‘sizes’ or ‘ages’) only some variants may be eligible for children’s VAT treatment. For example, if you are selling a shoe in a range of sizes, only some of the available sizes may meet a particular country’s governing rules. Equally, a range may fully meet one of the countries rules but only some variants may meet another.
Careful planning may be required and it may be better, in some cases, to split the stock over two or more listings, such as listing shoes up to a certain size on one listing and larger sizes on another – this does not cost you more in listing fees on Icephorm.
The consequences of getting this wrong are:
a) an under payment of VAT which may be challenged and fined by the relevant revenue collection authority
b) an over-charge of VAT on children’s clothes which may reduce your chance of selling your items and may be challenged by customers.
Last Update: November 2021