Amazon doesn't pay you like a normal customer. Every two weeks you receive a settlement — a net figure that combines sales revenue, refunds, FBA fees, storage charges, advertising costs, and sometimes VAT adjustments, all in a single number. Most accountants see that number hit your bank account and book it as revenue. That's wrong — and it's more common than you'd think.
Why General Accountants Struggle with FBA
When an accountant books your Amazon settlement as revenue, they're overstating your income, miscalculating your VAT liability, and giving you a P&L with no relationship to your actual profitability per unit or per channel.
We've taken on clients where the previous accountant had been doing this for two years. The VAT alone was out by tens of thousands of pounds. In one case, we recovered £20,000 of overpaid VAT in the first month.
What a Specialist Actually Does Differently
1. Reconciles settlements properly
A settlement is not revenue. A proper Amazon FBA accountant uses A2X or Link My Books to pull the settlement data apart — separating gross sales, returns, FBA fulfilment fees, storage fees, referral fees, and advertising spend — and books each component correctly in Xero or QuickBooks. This matters for both P&L accuracy and VAT.
2. Handles FBA VAT obligations correctly
If Amazon stores your stock in the UK, you need to be VAT registered regardless of your turnover. The £90,000 threshold doesn't apply once Amazon moves inventory into a UK fulfilment centre on your behalf. If you're on Pan-European FBA and Amazon has moved stock into warehouses in Germany, France, or Poland, you may have VAT registration obligations in those countries too. Most general accountants have no idea this is happening.
3. Understands EU OSS
Since July 2021, UK sellers shipping goods into the EU can use the One Stop Shop (OSS) scheme to file a single EU VAT return rather than registering in every member state. But OSS only covers certain B2C sales. If you're storing stock inside the EU, OSS doesn't cover it and you need individual country registrations. Getting this wrong can get your Amazon selling account suspended.
4. Gives you real margin reporting
Knowing your revenue isn't enough. You need gross margin per product or per channel — after COGS, Amazon fees, advertising spend, storage, and returns. That's the number that tells you which products are actually worth selling.
Questions to Ask Before You Hire
- What software do you use to reconcile Amazon settlements? Correct answer: A2X, Link My Books, or similar. "I do it manually in a spreadsheet" is a red flag.
- How do you handle the VAT element of Amazon VAT Services settlements? They should know that Amazon charges and collects VAT on your behalf for B2C sales in some scenarios.
- Have you dealt with Pan-European FBA and multi-country VAT registrations? If they hesitate, they haven't.
- How do you calculate COGS for an FBA business? Should include landed cost, Amazon inbound freight, and prep costs — not just the supplier invoice value.
Red Flags in Your Current Accountant
- Your annual accounts show Amazon revenue as a single line without any breakdown
- They've never mentioned VAT on your FBA storage or multi-country obligations
- You don't know your real net margin per product — just a year-end profit figure
- They communicate once a year around filing deadlines
- You've never been asked about your A2X or Link My Books setup
⚠️ If your accountant books your Amazon payout as revenue, your VAT return is almost certainly wrong. This is recoverable — but only if you catch it.
Selling on Amazon and not sure your books are right?
We'll review your settlement reconciliation, VAT position, and margin reporting — and tell you exactly what needs fixing. Free, 30 minutes.
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