***DISCLAIMER***
The team at Link My Books are happy to provide users with technical assistance in applying tax rules to their Link My Books setup. We are not Tax Advisors and so our advice and suggestions on the application of tax rules cannot be construed as tax advice. We highly recommend that users seek advice from qualified accountants for
their tax compliance.
Important: Country grouping applies to European Amazon seller accounts and to Etsy accounts.
Link My Books uses country grouping to set different tax rates based on where the sale was shipped to.
During setup you would have selected two VAT rates, one for UK vatable sales and one for non UK vatable sales.
The four country groups are:
UK
EU VAT Registered Countries
EU Non VAT Registered Countries
Rest of World
We would apply your UK rate to sales going to the UK group always.
We would apply your UK rate to sales going to the EU Non VAT Registered Countries group as long as the sale was from a marketplace which is not one of your EU VAT Registered Countries.
We would apply your Non UK rate to sales going to the EU Non VAT Registered Countries group if the sale was from a marketplace which is one of your EU VAT Registered Countries.
We would apply your Non UK rate to sales going to the Rest of the World Group always.
We would apply your Non UK rate to sales going to the EU VAT Registered Countries group always.
If you want to ensure its 100% perfect, but don't mind waiting each month until your Amazon VAT Transactions Report is available, we suggest doing it this way...
On the Account & Tax Mappings page set Zero Rated Income as your tax rate for all income related transactions (Amazon sales & Amazon Refunds) and then use the UK VAT figure from the Amazon VAT Transactions report we show within LMB to create a manual journal for your UK VAT on income each month.
When using this method we suggest you speak with your accountant first as manual journals can be tricky.
Etsy orders with no destination country
Etsy does not always supply a destination country for an order.
Where the country was blank, Link My Books previously defaulted that row to GB. For a seller based outside the UK, this put domestic sales into the export group — for example, an Australian seller's local sales were treated as GST-free exports rather than attracting GST.
This has been corrected. Blank Etsy rows now default to the country of your connected Xero or QuickBooks organisation, so your domestic sales are grouped correctly.
⚠️ Were your earlier settlements affected?
Settlements that were already sent to Xero or QuickBooks keep the treatment they were sent with. To correct them, roll them back and resend them so the corrected grouping and tax treatment flow through.
See Rollback feature: how it works. It is worth sharing this with your accountant so the corrections are made before they finish their review.