Facebook Ads post Brexit now with added VAT

Feemish
Explorer
64 0 59
Anyone else found Facebook is now slapping 20% VAT on Facebook Ads for UK businesses?

When we were in the EU, I believe FBs ads were subject to reverse VAT accounting so didn't actually get charged. But now we are out VAT seems to be being added to adspend.

Another Brexit win for small UK business!
Replies 6 (6)
Sara32
Shopify Partner
47 4 15

Yes @Feemish, luckily my clients are mostly VAT registered so it doesn't affect them.  I'm just waiting to see if Google will be doing the same...

Nice to get some warning though, this will have a massive impact on smaller businesses.

Specialising in Google Shopping for Shopify stores.
Feemish
Explorer
64 0 59

why do you think it won't affect VAT registered businesses? Were they not also subject to the reverse VAT accounting? Surely they will now have to pay the VAT and reclaim it?

Sara32
Shopify Partner
47 4 15

I meant it won't affect their profitability, as they can claim the VAT back.  Additional admin, yes of course.  

Specialising in Google Shopping for Shopify stores.
sunshine4
New Member
2 0 0

yes, an additional 20% has just been slapped on my ads too, with no warning! This is terrible news. Profit margins are so narrow as it is, it might mean the end of Facebook advertising for my small business. Does anyone know if Google will be or are currently doing the same? 

Feemish
Explorer
64 0 59

Along with the import taxes and customs declarations and delays when sending orders to the EU, this is another Brexit nail in the coffin of small UK businesses.

sunshine4
New Member
2 0 0

Agreed! It's the shock of it now that the real impact is starting to show. Gutted.