What does the VAT Margin Scheme mean to me as VAT registered seller?

What is a VAT margin scheme?

The VAT margin scheme applies to the sales of second-hand items made by resellers who purchased the item from an individual or another reseller without VAT. As part of the margin scheme, the reseller must account for VAT on the difference between the sales price and purchase price of the second-hand item, rather than the full selling price.

The margin scheme does not apply to second-hand items from outside of the EU for sellers with a residence within the EU, as well as items originating from outside the UK for sellers with a residence within the UK.

The onboarding process

To begin the onboarding process, you’ll need to provide the following details:

- Your name

- Your business name (if applicable)

- Your Tax Identification Number

- Your VAT number

To find out your TIN and VAT number, click here

If you’re acting in a professional capacity as a margin scheme seller, our team may need to collect additional information to ensure we comply with local regulations. For more details, please read our terms and conditions.

Once you have entered your details, we will ask to you to confirm that you have acquired the items without any VAT, hence no VAT is owed on this sale, and that the items can be classed as second-hand. Items must be authentic, unused and in the original packaging.

Finally, as we will need to receive an invoice for the sales, you will need to confirm that we can self-bill on your behalf. Click here to find more information on self-billing.

How does self-billing work?

Laced acts as reseller in the sale between the seller and the buyer. This means that you are selling the item directly to Laced.

To correctly apply the margin scheme, you must issue a compliant invoice. To make the process easier, we will create these invoices for you under a self-billing arrangement. This means we are billing Laced — in your name and on your behalf — for your items.

Once confirmed, we will ensure that you receive an invoice for your sale. You will be sent an email that states the item has been sold.

You will at all times continue to be responsible for VAT compliant invoices to Tax authorities. You are also responsible to store and keep the invoice documents throughout the statutory storage periods yourself.