CT600 for Amazon Sellers: Complete Guide

If you run your Amazon selling business through a UK limited company, you need to file a CT600 Corporation Tax return. This guide covers everything specific to Amazon sellers.

Overview: Amazon Selling Through a Company

Running your Amazon business through a limited company means:

Corporation Tax on profits (not Income Tax)
CT600 required within 12 months of year end
Separate accounts for the company
Different expense rules than sole traders

Key Tax Considerations for Amazon Sellers

1. Revenue Recognition

Your turnover for Box 145 includes:

All Amazon sales (gross, before fees)
Sales from your own website
Other marketplace sales (eBay, etc.)
Any other business income

Important: Use gross sales, not the net amount Amazon pays you.

2. Amazon Fees as Expenses

Amazon's various fees are deductible:

Fee Type	Tax Treatment
Referral fees	Deductible expense
FBA fees	Deductible expense
Storage fees	Deductible expense
Advertising fees	Deductible expense
Subscription fees	Deductible expense

These reduce your taxable profit.

3. Stock Valuation

Closing stock significantly affects your tax:

``` Opening stock £20,000 Purchases £150,000 Less: Closing stock (£35,000) Cost of sales £135,000 ```

You must value stock correctly at year end:

Cost price (what you paid)
Or net realisable value (if lower)

FBA inventory counts as stock even though it's in Amazon's warehouse.

Calculating Your CT600 Figures

Box 145: Turnover

Report gross sales including:

``` Amazon UK sales £300,000 Amazon EU sales £50,000 Own website sales £20,000 Total turnover £370,000 ← Box 145 ```

Box 155: Gross Profit

``` Turnover £370,000 Opening stock £20,000 Purchases £180,000 Closing stock (£35,000) Cost of goods sold £165,000 Gross profit £205,000 ← Box 155 ```

Operating Expenses

Typical Amazon seller expenses:

``` Amazon seller fees £55,000 FBA fulfilment fees £40,000 Amazon advertising £25,000 Storage fees £12,000 Product photography £3,000 Software subscriptions £2,500 Accounting fees £2,000 Other expenses £5,500 Total expenses £145,000 ```

Box 165: Trading Profit

``` Gross profit £205,000 Less: Expenses (£145,000) Trading profit £60,000 ← Box 165 ```

FBA Specific Considerations

FBA Inventory

Stock held by Amazon:

Still counts as your stock
Include in closing stock valuation
Track quantities in Seller Central

FBA Fees Breakdown

Fee	Description	Tax Category
Pick & Pack	Per unit fulfilment	Cost of sales
Weight handling	Shipping weight	Cost of sales
Monthly storage	Warehouse costs	Operating expense
Long-term storage	365+ day inventory	Operating expense
Removal order	Returns to you	Operating expense
Disposal	Unsellable stock	Operating expense

Pan-European FBA

If using Pan-European FBA:

May need VAT registration in other countries
Corporation Tax is still UK-based
All profits taxable in UK if company is UK resident

VAT and CT600

VAT is separate from Corporation Tax but affects your figures:

If VAT registered:

Report turnover excluding VAT
Report expenses excluding VAT
VAT on purchases is reclaimed separately

If not VAT registered:

Report turnover including any VAT charged
Include VAT paid on purchases in costs

VAT registration threshold: £90,000 (from April 2024)

Common Amazon Seller Expenses

Fully Deductible

Amazon seller fees (all types)
Stock purchases
Shipping and packaging
Product photography
Software tools (Helium 10, Jungle Scout, etc.)
Virtual assistant costs
Professional fees (accountant, bookkeeper)
Product samples
Returns and refunds
Inventory management tools

Partially Deductible

Home office costs (proportion of home expenses)
Car expenses (business proportion only)
Phone/internet (business use percentage)
Equipment (may be capital allowance)

Not Deductible

Personal expenses
Fines and penalties
Personal drawings
Entertainment

Capital Allowances

Business equipment may qualify:

Item	Allowance Type
Computer/laptop	AIA (100%)
Printer/scanner	AIA (100%)
Camera equipment	AIA (100%)
Warehouse racking	AIA (100%)
Van/commercial vehicle	AIA (100%)

The Annual Investment Allowance (AIA) allows 100% deduction up to £1,000,000.

Example: Complete CT600 for Amazon Seller

ABC Trading Ltd - Amazon FBA Business

Year ended 31 March 2025

Description	Amount
Amazon sales	£250,000
Opening stock	£15,000
Purchases	£100,000
Closing stock	£20,000
Cost of sales	£95,000
Gross profit	£155,000
Amazon fees	£37,500
FBA fees	£30,000
Advertising	£15,000
Other expenses	£22,500
Net profit	£50,000

CT600 Key Boxes:

Box 145: £250,000
Box 155: £155,000
Box 165: £50,000
Box 410: £50,000 (taxable)

Tax at 19%: £9,500

Record Keeping

Essential records for Amazon sellers:

Amazon settlements - Download and save monthly
Purchase invoices - All stock purchases
Bank statements - All business transactions
Stock records - Opening and closing counts
FBA inventory reports - For stock valuation
Expense receipts - All business expenses

Keep records for at least 6 years.

Common Mistakes

1. Wrong Turnover Figure

Wrong: Using Amazon payout as turnover Right: Use gross sales before Amazon fees

2. Missing Stock Adjustment

Wrong: Only counting stock at home Right: Include FBA inventory in stock count

3. Ignoring Amazon Fee Breakdown

Wrong: Using total Amazon deduction only Right: Categorise fees correctly for accounts

4. Mixing Personal and Business

Wrong: Paying personal expenses from business Right: Keep business and personal separate

When Using TinyTax

TinyTax makes Amazon seller CT600s straightforward:

Import your trial balance from accounting software
Software categorises income and expenses
Stock adjustment handled correctly
Amazon fees properly allocated

Need Help?

Amazon selling has specific tax considerations. TinyTax guides you through the CT600 process, ensuring all your Amazon income and expenses are correctly reported.

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