Specialist accountants
VAT for online sellers
Which VAT rules apply to an online sale depends on where the goods are when they are sold, where they are sent, who the customer is and where your business is established. This page describes the main rules from the official guidance. It is not tax advice.
The short answer
A UK business must register for VAT if its taxable turnover for the last 12 months goes over £90,000, or is expected to in the next 30 days. When you sell through an online marketplace, the marketplace accounts for the VAT on some sales, mainly where the seller is based overseas or the goods are outside the UK in consignments of £135 or less. Sales to customers in the EU follow different rules, and any EU registration is an EU process.
The rules at a glance
These rows are a summary of the GOV.UK and European Commission guidance. Each rule has exceptions, such as for alcohol and tobacco, that are not shown here. Check the source before you rely on it.
| Situation | What the guidance says |
|---|---|
| UK business selling goods in the UK, through its own website or a marketplace | You register once your taxable turnover goes over £90,000 in the last 12 months, or you expect it to in the next 30 days.1 If you are established in the UK and sell goods that are in the UK through a marketplace, GOV.UK says you are liable for the VAT, not the marketplace.2 |
| Overseas seller, goods in the UK when sold | The £90,000 threshold does not apply to businesses based outside the UK.1 Through a marketplace, GOV.UK says the marketplace is liable for the VAT on goods sold by overseas sellers.2 |
| Goods outside the UK when sold, consignment of £135 or less, sold through a marketplace | The marketplace charges and accounts for the VAT. If the customer is a VAT-registered business, the marketplace does not charge VAT and the business customer accounts for it instead.3 |
| Goods outside the UK, consignment over £135 | Normal import VAT and customs rules apply.3 |
| Goods sent from Great Britain to a customer outside the UK, including the EU | The UK supply of exported goods is zero-rated if the conditions in VAT Notice 703 are met, including keeping evidence of export.4 The EU side has its own VAT rules (see below). |
| Goods sent from Northern Ireland to consumers in the EU | Different rules apply. Above the distance selling threshold of £8,818 (10,000 euros) a year, VAT is due in the country the goods are sent to. You can choose to use the One Stop Shop Union scheme instead of registering in each EU country.5 |
Selling in the UK
Taxable turnover is the total value of everything you sell that is not VAT exempt or "out of scope". It is not profit, and for a marketplace seller it is not the amount paid into your bank after fees.1 I'm close to the VAT threshold sets out the steps to register.
GOV.UK defines an online marketplace as a website or app that lets other businesses offer goods for sale and is involved in all of these: setting terms for the sale, processing or enabling payment, and ordering or delivery. A business that only takes payments, only lists goods, or only sends customers to another site is not an online marketplace under this definition.2 Your own website shop is not a marketplace, so the VAT on those sales is yours to account for if you are registered.
Being "established in the UK" has its own meaning. GOV.UK says a UK company registration, a registered or virtual office, or an address in the business name is unlikely on its own to show that a business is established in the UK.2 If you are not sure which side of that line you are on, ask an accountant or tax adviser.
Selling goods to customers in the EU from Great Britain
On the UK side, goods you export can be zero-rated if you meet the conditions in VAT Notice 703 and keep official or commercial evidence that the goods left the UK.4
On the EU side, VAT is set by EU law and run by EU countries. The European Commission's One Stop Shop has three schemes: the non-Union scheme, the Union scheme and the import scheme. The import scheme covers goods sent in consignments of a value not exceeding EUR 150, and a business established outside the EU must appoint an intermediary established in the EU to use it. The schemes are optional.6 GOV.UK also says businesses in Great Britain must use an intermediary if they choose to use the import scheme.7
Registering for an EU scheme, or for VAT in an EU country, is done with that country's tax authority, not HMRC. Whether you need to depends on how you sell, the value of the consignments, whether you use a marketplace and whether your stock is held in the EU. This is a point to take to an accountant or tax adviser who deals with EU VAT.
Northern Ireland
Different VAT rules apply to goods in Northern Ireland. GOV.UK says that if you sell goods from Northern Ireland to consumers in the EU and go above the distance selling threshold, you pay VAT in the country the goods are sent to, which could mean registering in up to 27 EU countries, unless you choose the One Stop Shop Union scheme.5 Marketplace rules also differ: for goods in Northern Ireland sold to a customer in Northern Ireland, a seller established in the UK or EU is liable for the VAT.2 If your business or stock is in Northern Ireland, check the GOV.UK guidance for Northern Ireland specifically.
Digital records
GOV.UK says you must keep some VAT records digitally unless you are exempt from the Making Tax Digital for VAT rules, using compatible software or other software, such as spreadsheets, that connects to HMRC's systems.8 For an online seller, that can mean getting marketplace and shop sales into software in a form that matches your VAT return.
When to get help
This part is our judgement. It may be worth talking to an accountant with ecommerce experience if you are near the £90,000 threshold, sell through more than one marketplace, send goods to customers abroad, hold stock outside the UK, or are not sure whether a marketplace or you should account for the VAT on a sale.
Sources
- GOV.UK, "Register for VAT: When to register". gov.uk/vat-registration/when-to-register. Checked 12 October 2026.
- HMRC, "Charging VAT when goods are sold if you're an online marketplace operator", last updated 20 June 2025. GOV.UK. Checked 12 October 2026.
- HMRC, "Charging VAT when using an online marketplace to sell goods to customers in the UK", last updated 20 June 2025. GOV.UK. Checked 12 October 2026.
- HMRC, "VAT on goods exported from the UK (VAT Notice 703)", last updated 4 March 2026. GOV.UK. Checked 12 October 2026.
- HMRC, "Check how to report and pay VAT on distance sales of goods from Northern Ireland to the EU", last updated 1 October 2026. GOV.UK. Checked 12 October 2026.
- European Commission, "One Stop Shop". vat-one-stop-shop.ec.europa.eu. Checked 12 October 2026.
- HMRC, "Check if you can register for the VAT Import One Stop Shop scheme", last updated 19 February 2026. GOV.UK. Checked 12 October 2026.
- GOV.UK, "Charge, reclaim and record VAT: Keeping VAT records". GOV.UK. Checked 12 October 2026.