Do I Need a Business Number to Sell on Amazon?

Selling on Amazon can be an exciting venture, but it comes with its own set of requirements and regulations. One common question for potential sellers is whether they need a business number to start selling on Amazon. This article will address this question in detail, exploring what a business number is, why it might be required, and how to obtain one if necessary.

What is a Business Number?

A business number is a unique identifier assigned to a business by a government authority. It is used for various purposes, including tax reporting, business registrations, and other legal matters. In some countries, this number is essential for businesses to operate legally and manage their financial transactions.

Do You Need a Business Number to Sell on Amazon?

The necessity of a business number when selling on Amazon largely depends on the country you are operating in and the nature of your business. Here’s a breakdown:

1. United States: In the U.S., you generally do not need a formal business number to start selling on Amazon. However, if you are operating as a business entity rather than an individual (e.g., a corporation or LLC), you will need an Employer Identification Number (EIN). This number is used for tax purposes and is essential for businesses with employees or those who need to file business taxes.

2. Canada: In Canada, if you are selling as a business entity, you will need a Business Number (BN) for tax purposes. The BN is issued by the Canada Revenue Agency (CRA) and is required for collecting and remitting sales tax, among other things. If you are an individual seller, you might not need a BN unless your sales exceed a certain threshold or you register as a business.

3. United Kingdom: In the UK, a business number, known as the VAT number, is necessary if you are registered for Value Added Tax (VAT). You need to register for VAT if your sales exceed a specific threshold or if you want to reclaim VAT on business purchases. Individual sellers below this threshold do not require a VAT number.

4. Australia: In Australia, if you are running a business and selling on Amazon, you need an Australian Business Number (ABN). This is required for tax purposes and helps in managing GST (Goods and Services Tax). If you are selling as an individual, an ABN might not be required unless you meet certain criteria for GST registration.

Why Might a Business Number Be Required?

A business number helps Amazon and tax authorities verify your identity and ensure compliance with tax laws. It also simplifies the process of handling sales tax, VAT, or GST, which can be crucial for operating legally and avoiding potential fines or penalties.

How to Obtain a Business Number

1. United States: Apply for an EIN through the IRS website. The process is straightforward and can be completed online.

2. Canada: Apply for a BN through the CRA website. You may need to register for additional accounts such as GST/HST if applicable.

3. United Kingdom: Register for VAT through the HM Revenue and Customs (HMRC) website if required.

4. Australia: Apply for an ABN through the Australian Business Register (ABR) website. Registration is usually free and can be done online.

Conclusion

In summary, whether you need a business number to sell on Amazon depends on your location and the type of business entity you operate. While individual sellers often do not require a business number, those running a business entity or reaching certain sales thresholds will need to obtain one. Ensuring you have the appropriate numbers and registrations in place is essential for a smooth selling experience and compliance with local regulations.