Usedkit › Margin scheme VAT calculator

Margin scheme VAT calculator for second-hand goods

Selling used goods you bought from private people? Under the margin scheme you pay VAT on your margin only. Enter the selling and purchase price to see the VAT.

Margin
VAT on the margin
You keep
Under normal VAT it would be

The calculation is the same in every EU country and the UK: VAT = margin × rate / (100 + rate). Rates change; check yours. This is a calculator, not tax advice.

Margin scheme VAT, in five questions

What is the margin scheme?

A special VAT arrangement for dealers in second-hand goods, works of art, collectors' items and antiques (EU VAT Directive 2006/112/EC, Articles 311 to 325). When the dealer bought the item without VAT — from a private person, or from another dealer who sold it under the margin scheme — VAT is paid only on the margin: the selling price less the purchase price.

How is margin scheme VAT calculated?

The margin includes the VAT, so the VAT is the margin times rate / (100 + rate). A camera bought for 450 and sold for 549 at Finland's 25.5 % has a margin of 99 and VAT of 99 x 25.5 / 125.5 = 20.12. Sold at a loss, an item has no VAT.

What must the invoice say?

It must not show VAT, and it must refer to the scheme: 'Margin scheme - Second-hand goods' (Article 226(14)), in each country's own language. A business buyer cannot deduct VAT on a margin-scheme item.

What is the global margin?

Some countries let dealers work out the margin per tax period instead of per item: the period's margin-scheme sales less its margin-scheme purchases, sold or not. Losses offset gains, and a negative period margin may carry into the next period. Per item is the default; whether the global method is open to you is a question for your tax authority or accountant.

Which goods qualify?

Used goods bought for resale without VAT: from consumers, from businesses not registered for VAT, or from dealers who sold under the margin scheme. New goods do not qualify, and neither do goods whose purchase included deductible VAT. Each sale may also be made under normal VAT instead.

Margin VAT in WooCommerce

Usedkit does this for every sale: a purchase price and a margin-scheme mark on each product, no separately charged VAT on those items at checkout, the margin VAT stored on each order line, the invoice wording on order pages and emails, and a monthly or quarterly report — per item, or the global margin with losses carried forward — with a CSV for your accountant.

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