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| | | Author: | bricketycricket  | | Posted: | Sep 18, 2022 11:28 | | Subject: | Opening a new store and taxes | | Viewed: | 168 times | | Topic: | Taxes | |
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| Hello fellow bricklink members!
I am in the process of opening a bricklink store and the tax perspective is giving
me a major headache.
Here are some specifics about my upcoming store:
-I would consider myself a private individual selling his personal collection
and not a reseller, since I would be selling what I already have and not buying
and selling.
-I would be selling sets, minifigures and parts, as well as some custom builds
-Everything will be in USED condition, the majority of sets and parts are from
the 90s.
-Since it is a huge collection the inventory would be quite big with many rare
and expensive items
-Therefore I am almost certain I will pass the yearly 10k EU threshold since
most of my buyers will be from EU and I am from a small country (Slovenia).
According to my country's laws, which are similar to many other EU country's
laws, if you sell used items then you have to pay tax on the difference in the
purchase price and the selling price. What are you supposed to do if it is impossible
to determine a purchase price, let alone have any proof of it? Most of my lego
is a combination of my childhood collection, lego from friends and family, bulk
lots on ebay and missing parts from briclink. Do you than have to pay VAT on
the ENTIRE amount?
If I got a tax exemption (still looking into this) how would Bricklink handle
this if I reached the 10k threshold?
I am wondering about selling my entire collection to one buyer as that would
be much simpler, but would minimize profit, not to mention it would be hard to
find someone with that kind of available funds. On the other hand I would kind
of like the challenge of running my own store as a side hustle, but if I lose
20-25% of the value on taxes than its not even remotely worth the effort IMO.
Any advice would be much appreciated and if we ever meet I'll owe you a drink!
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| | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 11:47 | | Subject: | (Cancelled) | | Viewed: | 34 times | | Topic: | Taxes | |
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| | (Cancelled) |
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| | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 11:50 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 49 times | | Topic: | Taxes | |
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| For selling your own collection, I don't believe you're obliged to be
established as a legal Seller.
But of course, don't forget to declare this exceptional and personal income
to IRS 
In this case, there's no VAT involved, and OSS should NOT concern you.
If you're established as a Company (even a micro one), then the normal way
is to invoice VAT on the whole price.
What you're talking about it Margin Scheme, which is - I think - less common.
And the problem with margin scheme is that BL does not implement it.
So when you'll reach the OSS threshold, BL will invoice VAT on the whole
price, NOT the margin.
In short, I don't recommend you the margin scheme if you're thinking
you'll get above the threshold.
Or, you can also simply ignore OSS, and get blocked for selling in EU say the
last few months of the year, as it resets when the year starts.
That's another solution.
I think those are your options.
HTH
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| | | | | | | Author: | bricketycricket | | Posted: | Sep 18, 2022 12:57 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 35 times | | Topic: | Taxes | |
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| In Taxes, 1001bricks writes:
| | For selling your own collection, I don't believe you're obliged to be
established as a legal Seller.
But of course, don't forget to declare this exceptional and personal income
to IRS
In this case, there's no VAT involved, and OSS should NOT concern you.
If you're established as a Company (even a micro one), then the normal way
is to invoice VAT on the whole price.
What you're talking about it Margin Scheme, which is - I think - less common.
And the problem with margin scheme is that BL does not implement it.
So when you'll reach the OSS threshold, BL will invoice VAT on the whole
price, NOT the margin.
In short, I don't recommend you the margin scheme if you're thinking
you'll get above the threshold.
Or, you can also simply ignore OSS, and get blocked for selling in EU say the
last few months of the year, as it resets when the year starts.
That's another solution.
I think those are your options.
HTH
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Hello 1001bricks,
Thanks for the reply! I am a student and I also work, so selling lego would be
my side hustle. I was indeed referring to the margin scheme like you said which
is something bricklink should implement and I think I heard in a webinar bricklink
gave that if you qualify they let you have a second account that is monitored
for this, which is a band aid and not a true solution IMO. Regardless as I have
said there is no way for me to even determine much less prove a purchase price
for any of my lego so this is a no go most likely. I am wondering if I get an
approved tax exemption in my country how bricklink will handle it if I reach
the 10k threshold. The second choice is also not ideal since that would mean
it would take way longer to sell items and require constant monitoring, since
some sets can sell for 500e which is 5% of the threshold. And I was also thinking
of selling thematic collections as superlots and in a few cases 1 of them would
be around 50% of the threshold. Plus before Christmas is when most sales are
made I think. I also intend to close the store once I sell the majority of items
and any money I make from this will go into my savings for traveling so I am
keen to not lose a single cent more than I absolutely have to for taxes and fees.
Have a nive day 
Jasa
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| | | | | | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 13:11 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 26 times | | Topic: | Taxes | |
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| | | Thanks for the reply! I am a student and I also work, so selling lego would be
my side hustle. I was indeed referring to the margin scheme like you said which
is something bricklink should implement and I think I heard in a webinar bricklink
gave that if you qualify they let you have a second account that is monitored
for this, which is a band aid and not a true solution IMO. Regardless as I have
said there is no way for me to even determine much less prove a purchase price
for any of my lego so this is a no go most likely. I am wondering if I get an
approved tax exemption in my country how bricklink will handle it if I reach
the 10k threshold. The second choice is also not ideal since that would mean
it would take way longer to sell items and require constant monitoring, since
some sets can sell for 500e which is 5% of the threshold. And I was also thinking
of selling thematic collections as superlots and in a few cases 1 of them would
be around 50% of the threshold. Plus before Christmas is when most sales are
made I think. I also intend to close the store once I sell the majority of items
and any money I make from this will go into my savings for traveling so I am
keen to not lose a single cent more than I absolutely have to for taxes and fees.
Have a nive day
|
Thanks!
Again, don't use margin scheme.
If possible, see how much you can sell in your Country laws without being "a
seller".
Then you've got no VAT, no OSS problem, no calculation of margin (that you
don't know or can't prove apparently).
Sylvain
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| | | | | | | | | | | Author: | SylvainLS | | Posted: | Sep 18, 2022 13:14 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 22 times | | Topic: | Taxes | |
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| In Taxes, 1001bricks writes:
| | […]
If possible, see how much you can sell in your Country laws without being "a
seller".
Then you've got no VAT, no OSS problem, no calculation of margin (that you
don't know or can't prove apparently).
|
No. The €10k limit doesn’t care about your domestic status.
Read my previous message… and all the answers I already made to such posts, some
of them yours.
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| | | | | | | | | Author: | SylvainLS | | Posted: | Sep 18, 2022 13:14 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 22 times | | Topic: | Taxes | |
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| In Taxes, bricketycricket writes:
| | […]
I think I heard in a webinar bricklink
gave that if you qualify they let you have a second account that is monitored
for this, which is a band aid and not a true solution IMO.
|
But Russell recently said they realized it’s not a good solution and you shouldn’t
do that any more.
| | Regardless as I have
said there is no way for me to even determine much less prove a purchase price
for any of my lego so this is a no go most likely.
|
Well, if your country doesn’t tax sales of personal stuff, good for you.
But if it does like in France, you’ll have to come up with a value….
| | I am wondering if I get an
approved tax exemption in my country how bricklink will handle it if I reach
the 10k threshold.
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The €10k is EU-wide and doesn’t care about what you can do in your country.
I don’t think BL will care.
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| | | | | | | Author: | SylvainLS | | Posted: | Sep 18, 2022 13:08 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 31 times | | Topic: | Taxes | |
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| In Taxes, 1001bricks writes:
| | […]
For selling your own collection, I don't believe you're obliged to be
established as a legal Seller.
But of course, don't forget to declare this exceptional and personal income
to IRS
In this case, there's no VAT involved,
|
Well, there’s this argument:
In France, personal sales have a special tax: sell for more than €5000 of your
personal stuff online in a year and you owe about 20% of tax on the added
value.
TAV / VAT!
So there’s no VAT but the end result (money in your pocket) is exactly like margin
VAT. Surprise surprise
I’m sure the other countries have similar mechanisms. (Tax ideas are very contagious.)
| | and OSS should NOT concern you.
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Yes, it should!
Just saying “I’m neither registered nor incorporated” doesn’t mean you can sell
for tens of thousands euros, even if it’s also only your old stuff.
If you reach the threshold to be registered, then you have to register (and maybe
incorporate, the two are different), period.
That threshold can be the local threshold (€50k in Slovenia…) or the EU common
threshold (€10k).
If I, as an unregistered French individual, sell for €51k of my old stuff, I’m
not obliged to register or incorporate in France (€85k threshold)… but if I were
in Slovenia, I would have to (€50k threshold). And even if I stay in France
but sell all my stuff to Slovenians, the Slovenian gouvernment would surely want
to have words with me
Remember this:
The EU common threshold (and the associated OSS) is a simplification:
1. You don’t have to check the threshold of each and every EU countrie to know
in which ones you have to register.
2. You don’t have to register in each one of the EU countries, there’s a One-Shop-Stop
(OSS).
So the rules are almost the same as before… the problem with this simplification
is that the common €10k threshold is way lower than many of the individual thresholds
and it’s compounded with it being common (= all non-domestic sales, not per country).
| | If you're established as a Company (even a micro one), then the normal way
is to invoice VAT on the whole price.
|
Yes, because you buy things with VAT and you deduct / get refunded that VAT.
That compensation doesn’t exist when you buy used stuff from non-registered individuals.
| | What you're talking about it Margin Scheme, which is - I think - less common.
|
But common for antiquers and used LEGO businesses. I’m sure accountants and
Chambers of commerce advise antiquers, used-car dealers and some other well-known
used-stuff dealers to use the margin VAT scheme, even in France… but they don’t
yet know about BrickLink! 
| | And the problem with margin scheme is that BL does not implement it.
|
Yeah, that’s really the crux of the problem 
| | So when you'll reach the OSS threshold, BL will invoice VAT on the whole
price, NOT the margin.
|
Well, BL doesn’t exactly “invoice VAT.” BL “deems that your prices include VAT”
and will show it this way to your EU buyers and will remove VAT for your non-EU
buyers.
For instance, if you’re VAT & OSS registered, you set your price at €100 and
BL will say:
— to a French buyer: it’s €100, that includes a 20% VAT,
— to a Danish buyer: it’s €100, that includes a 25% VAT,
— to a non-EU buyer: it’s €(100 / 1.XX), with XX being your local VAT rate.
(
— to a UK buyer: it’s €(100 / 1.XX)*1.20, because BL removes the EU VAT and adds
the UK 20% VAT, that you don’t receive but see on the invoice and in the transaction,
— to a US buyer: it’s €(100 / 1.XX)*1.YY, because BL removes the EU VAT and adds
the local Sale taxes, that you don’t receive but see on the invoice and in the
transaction.
)
| | In short, I don't recommend you the margin scheme if you're thinking
you'll get above the threshold.
Or, you can also simply ignore OSS, and get blocked for selling in EU say the
last few months of the year, as it resets when the year starts.
That's another solution.
|
Which requires patience
| | I think those are your options.
HTH
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| | | | | | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 13:18 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 28 times | | Topic: | Taxes | |
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| In Taxes, SylvainLS writes:
| | In Taxes, 1001bricks writes:
| | […]
For selling your own collection, I don't believe you're obliged to be
established as a legal Seller.
But of course, don't forget to declare this exceptional and personal income
to IRS
In this case, there's no VAT involved,
|
Well, there’s this argument:
In France, personal sales have a special tax: sell for more than €5000 of your
personal stuff online in a year and you owe about 20% of tax on the added
value.
TAV / VAT!
|
LOL - didn't know this one
Let's agreed they're really creative!
About OSS.
So if you've not VAT registered in your Country (personal seller), they provide
you with an intra comm VAT-ID?
That means you don't count VAT for your Country (or Export) but collect and
pay VAT for other EU countries?
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| | | | | | | | | | | Author: | SylvainLS | | Posted: | Sep 18, 2022 13:57 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 33 times | | Topic: | Taxes | |
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| In Taxes, 1001bricks writes:
| | […]
LOL - didn't know this one
Let's agreed they're really creative!
|
The rate is slightly different: 19% and not 20%… but I think it’s just because
they didn’t change the rate when the VAT changed
| | About OSS.
So if you've not VAT registered in your Country (personal seller), they provide
you with an intra comm VAT-ID?
|
Yes. Anybody can ask for a VAT ID and not be incorporated. It generaly is just
for a couple special transactions and, as always, they prefer you to be in one
of their usual case, not abuse that, and having you become a registered business
ups the country’s stats. So they’ll push you to become a micro-business or something.
But it’s possible.
| | That means you don't count VAT for your Country (or Export) but collect and
pay VAT for other EU countries?
|
Yes. And it’s logical and doesn’t date from the new common threshold OSS scheme.
How would you like if you were Belgian, with a €25k threshold for VAT registration,
and someone from France sold almost exclusively to your country for €80k (so
below France’s VAT threshold) but didn’t have to be registered?
Unfair competition.
So that person needs to register for VAT in Belgium… but still not obligated
to be registered in France.
The new scheme only lowers the threshold and make it common.
And, yes, it’ll be a mess to handle.
Now, I’m concerned about your memory: we already talked about that multiple times,
and especially last year in private emails.
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| | | | | | | | | | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 14:02 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 24 times | | Topic: | Taxes | |
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| Great info, thanks!
| | Now, I’m concerned about your memory: we already talked about that multiple times,
and especially last year in private emails.
|
You shouldn't.
But first: who are you?
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| | | | | | | | | | | | | | | Author: | macebobo | | Posted: | Sep 18, 2022 14:04 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 23 times | | Topic: | Taxes | |
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| In Taxes, 1001bricks writes:
| | Great info, thanks!
| | Now, I’m concerned about your memory: we already talked about that multiple times,
and especially last year in private emails.
|
You shouldn't.
But first: who are you?
|
He's your brother from another mother.
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| | | | | | | | | | | | | | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 14:05 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 28 times | | Topic: | Taxes | |
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| In Taxes, macebobo writes:
| | In Taxes, 1001bricks writes:
| | Great info, thanks!
| | Now, I’m concerned about your memory: we already talked about that multiple times,
and especially last year in private emails.
|
You shouldn't.
But first: who are you?
|
He's your brother from another mother.
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Nice concept, fun, thanks!
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| | | | | | | | | Author: | bricketycricket | | Posted: | Sep 18, 2022 15:27 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 31 times | | Topic: | Taxes | |
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| In Taxes, SylvainLS writes:
| | In Taxes, 1001bricks writes:
| | […]
For selling your own collection, I don't believe you're obliged to be
established as a legal Seller.
But of course, don't forget to declare this exceptional and personal income
to IRS
In this case, there's no VAT involved,
|
Well, there’s this argument:
In France, personal sales have a special tax: sell for more than €5000 of your
personal stuff online in a year and you owe about 20% of tax on the added
value.
TAV / VAT!
So there’s no VAT but the end result (money in your pocket) is exactly like margin
VAT. Surprise surprise
|
Hello and thanks for the detailed replies Sylvain,
In Slovenia there is no 5000e threshold for selling personal stuff online. Instead
FURS (Slovenian IRS) gives us a very vague explanation which is as follows (translated):
"The value and quantity of goods that could be sold via online portals are not
legally defined. For it to not be considered illegal work it is especially important
that the individual sells his products that are in used condition, that he does
so only from time to time and, most importantly, that he does not perform a "gainful"
activity by selling, which means that he does not sell with the aim of making
a profit." So this basically means if you pop up on their radar you are screwed.
The problem is that if you are a student In Slovenia and if you register a business
which for this case would mean registering as a sole proprietor which would mean
losing certain very important student benefits like the right to subsidized meals
and public transport (yes we have that in Slovenia), student housing, scholarships
and for what is most important to me the right to work via the student services
center referrals. Not to mention that you would have to now pay hefty sums for
health and social insurance. So right now to sell lego as a registered seller
I would have to lose by job and student benefits, pay at least 400e a month in
health and social insurance, pay income tax and then to top it off pay 20-25%
VAT once I reach the threshold. So I would have to be clinically insane to do
that.
Mabie next year registering wouldn't be so bad as I plan to start something
else anyway, I wouldn't even mind paying a little in taxes, but I simply
put way too much time and effort to lose 20-25% of the value for taxes on something
that has already been taxed, not to mention the time and effort of selling it.
And as you said for margin taxes you simply need a purchase value and if I make
one up and get audited I am royally screwed (fines for these kind of things are
quite big). Selling below the threshold would take way longer and be super stressful
to monitor. Slovenia is a small country with many bl stores already so majority
of sales would be EU.
So I don't know what to do, can I get an EU wide tax exemption or something
and register on the OSS. Or what would you do in my situation?
Best regards,
Jasa
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| | | | | | | | | | | Author: | 1001bricks | | Posted: | Sep 18, 2022 16:09 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 31 times | | Topic: | Taxes | |
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| | | So I don't know what to do, can I get an EU wide tax exemption or something
and register on the OSS. Or what would you do in my situation?
|
Frankly?
Having read you:
1) Don't register as business.
2) Try to open quickly your shop, as you have 3+ months remaining to sell up
to 10K€ with no complication.
3) Then in 2023 you've another 10K€ threshold. Sell first, when and you reach
it, just keep on selling localy and export.
You'll have then time to decide what to do examining your sales, and having
reached the threshold maybe in July or in September.
In short, you've one full year with zero OSS - I would go ahead
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| | | | | | | | | | | | | Author: | bricketycricket | | Posted: | Sep 18, 2022 16:47 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 29 times | | Topic: | Taxes | |
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| Hey,
Thanks for your opinion on what to do. Unfortunately I think I will not be able
to start this year as I still have to finish setting everything up and it takes
at least a month to get verified. The thing is I wanna sell everything as fast
as possible (I have goal of max 3 years from January) and with this threshold
that would mean it would probably take 5-7 years instead of 1-3 (I am confident
that 90s lego if not overpriced sells well and fast with a big inventory). But
the thing is work online and plan to continue that and I want to travel asap
and I can't exactly take my inventory with me. So I guess if there is no
way around it without me being at least refunded the VAT somehow I will try
to sell everything to one person. But mabie rules and procedures will change
in the next few months, who knows...
Have a good night!
Jasa
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| | | | | | | | | | | Author: | SylvainLS | | Posted: | Sep 18, 2022 17:00 | | Subject: | Re: Opening a new store and taxes | | Viewed: | 38 times | | Topic: | Taxes | |
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| In Taxes, bricketycricket writes:
| | […]
Hello and thanks for the detailed replies Sylvain,
In Slovenia there is no 5000e threshold for selling personal stuff online. Instead
FURS (Slovenian IRS) gives us a very vague explanation which is as follows (translated):
"The value and quantity of goods that could be sold via online portals are not
legally defined. For it to not be considered illegal work it is especially important
that the individual sells his products that are in used condition, that he does
so only from time to time and, most importantly, that he does not perform a "gainful"
activity by selling, which means that he does not sell with the aim of making
a profit." So this basically means if you pop up on their radar you are screwed.
|
Well, a lot of things are like that with taxes in every country: if you’re audited,
it’s under their appreciation whether you fit in the rules or not.
| | The problem is that if you are a student In Slovenia and if you register a business
which for this case would mean registering as a sole proprietor which would mean
losing certain very important student benefits like the right to subsidized meals
and public transport (yes we have that in Slovenia), student housing, scholarships
and for what is most important to me the right to work via the student services
center referrals. Not to mention that you would have to now pay hefty sums for
health and social insurance. So right now to sell lego as a registered seller
I would have to lose by job and student benefits, pay at least 400e a month in
health and social insurance, pay income tax and then to top it off pay 20-25%
VAT once I reach the threshold. So I would have to be clinically insane to do
that.
|
Ah, I see. I don’t know how that would work in France. ‘We’ created the ‘auto-entrepreneur’
status to copy other countries’ micro-business statuses and it’s for small jobs
or when you already have another job and want to test waters (like selling LEGO
on BL )… but I don’t know how it would interfere with scholarship student status.
I don’t think it would cancel everything… but I’m not sure.
Anyway, you don’t live in France
| | Mabie next year registering wouldn't be so bad as I plan to start something
else anyway, I wouldn't even mind paying a little in taxes, but I simply
put way too much time and effort to lose 20-25% of the value for taxes on something
that has already been taxed, not to mention the time and effort of selling it.
And as you said for margin taxes you simply need a purchase value and if I make
one up and get audited I am royally screwed (fines for these kind of things are
quite big). Selling below the threshold would take way longer and be super stressful
to monitor. Slovenia is a small country with many bl stores already so majority
of sales would be EU.
So I don't know what to do, can I get an EU wide tax exemption or something
and register on the OSS.
|
Thing is, that EU rule is EU-wide… but there’s no EU tax agency, only country
agencies. So there’s no EU-wide tax exemption.
Even if Slovenia’s FURS said you were okay… what would happen if you sold more
than €10k to one EU country? They would be “hey FURS, one of our resident bought
for €10k from someone in Slovenia but we didn’t get the VAT for that” and FURS
wold change its mind….
Okay, pretty much a ‘thought experiment’ here: I’m not sure they would react
for a few thousands euros, but it’s for the principle.
| | Or what would you do in my situation?
|
Mostly like Sylvain (1001bricks) said: open your store but don’t sell over €10k
intra-EU if you’re not ready for registering.
Eh, with luck you’ll sell everything to a non-EU buyer
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Slovenia
France, Provence-Alpes-Côte d'Azur
USA, Oregon