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.
Introduction
Link My Books exists to make accounting for your TikTok Shop (and other e-commerce channels) sales, refunds, fees and VAT easy and accurate.
That's why as part of our quick and easy setup wizard, we'll provide you with some default accounts and tax rates to confirm.
This means that you can be confident your bookkeeping is clean and accurate. Trust me, your accountant will thank you for it.
Link My Books default accounts for TikTok Shop
TikTok Shop has hundreds of different transaction types, so to keep things simple we group them into 13 top level categories:
Sales
Refunds
Shipping
Shipping Refunds
Inventory Reimbursements
Seller Fees
Fulfillment Fees
Storage Fees
Advertising Fees
Reserved Balances
Split Month Rollovers
Sales Tax
Loans
If you accept our default accounts during setup we'll create one account for each of these different categories and add them to your existing chart of accounts in Xero or QuickBooks.
Here are our default accounts:
Account Code & Name | Account Type |
LMB70: TikTok Sales | Revenue |
LMB71: TikTok Refunds | Revenue |
LMB72: TikTok Shipping | Revenue |
LMB73: TikTok Shipping Refunds | Revenue |
LMB79: TikTok Inventory Reimbursements | Other income |
LMB74: TikTok Seller Fees | Expenses |
LMB74b: TikTok Fulfillment Fees | Expenses |
LMB74c: TikTok Storage Fees | Expenses |
LMB74d: TikTok Advertising Fees | Expenses |
LMB75: Tiktok Reserved Balances | Current Liability |
LMB76: TikTok Split Month Rollovers | Currency Asset |
LMB77: TikTok Sales Tax | Current Liability |
LMB78: TikTok Loans | Current Liability |
💡Good to know
You can, of course, choose any accounts you like during setup. Plus you can even dive deeper into the sub-categories contained within these top level categories. You can learn more about fine tuning your account mappings in this help article.
Link My Books default tax rates for TikTok Shop UK accounts
If you are VAT registered in the UK then we'll also provide some default tax rates for you to confirm.
Here are our default tax rates for sales revenue for UK VAT registered businesses:
Transaction Tax Category | Tax Rate |
Standard Rated Goods Shipped to UK | 20% (VAT on Income) |
Reduced Rated Goods Shipped to UK | 5% (VAT on Income) |
Zero Rated Goods Shipped to UK | Zero Rated Income |
Sales shipped outside UK | Zero Rated Income |
Here are our default tax rates for fees & other transactions for UK VAT registered businesses:
Transaction Tax Category | Tax Rate |
Inventory Reimbursements | 20% (VAT on Income)* |
Fees | 20% (VAT on Expenses) |
Split Month Rollovers | No VAT |
Sales Tax | No VAT |
Loans | No VAT |
Amazon Reserved Balances | No VAT |
*TikTok Shop reimburse sellers VAT inclusive amounts for items lost and damaged.
💡Good to know
Again, you can change these tax rates to suit your business if you wish to do so - they are just defaults. You should only change tax rates on the Accounts & Taxes Wizard and not on the Accounts & Tax Mappings page.
If you have any questions about this article or feedback on how we could make it better please reach out to the support team via the blue chat icon on the bottom right of the page or via email to [email protected].