VAT for E-commerce Sellers

Key facts

Online marketplaces (Amazon, eBay) may be responsible for collecting VAT on some sales.
UK sellers must register for VAT when taxable turnover exceeds £90,000.
Overseas sellers storing goods in the UK must register for UK VAT regardless of turnover.
Post-Brexit, goods imported into the UK under £135 have VAT collected at point of sale.

UK-Based Sellers

If you’re a UK seller on platforms like Amazon, eBay, or your own website, the standard VAT rules apply:^[3]

Register for VAT when taxable turnover exceeds £90,000
Charge VAT on all taxable sales
File VAT Returns quarterly via MTD

Marketplace VAT Collection

Since January 2021, online marketplaces must collect and account for UK VAT on:^[1]

Goods from overseas sellers with a value of £135 or less, sold to UK customers
Goods in the UK sold by overseas sellers to UK customers (any value)

The marketplace becomes the “deemed supplier” and handles the VAT.

Overseas Sellers Storing Goods in the UK

If you’re an overseas seller with stock in a UK fulfilment centre (e.g. Amazon FBA), you must register for UK VAT regardless of your turnover.^[2]

Selling from Your Own Website

If you sell directly (not through a marketplace), you handle VAT yourself:

UK customers: charge UK VAT at the appropriate rate
EU customers: follow place of supply rules
Rest of world: export (zero-rated if you hold proof of export)

Tip: Keep clear records of which sales are marketplace-facilitated (where the marketplace collects VAT) and which are direct sales (where you collect VAT). Don’t double-count.

Frequently Asked Questions

Do I need to register for VAT to sell online in the UK?

UK-based sellers must register for VAT when their taxable turnover exceeds £90,000. Overseas sellers storing goods in the UK must register regardless of turnover.

Does the online marketplace collect VAT on my behalf?

Since January 2021, marketplaces like Amazon and eBay must collect UK VAT on sales by overseas sellers for goods valued at £135 or less, and on goods already in the UK sold by overseas sellers.

How is VAT handled on low-value imports sold online?

For goods imported into the UK with a consignment value of £135 or less, VAT is collected at the point of sale rather than at the border. The online marketplace or seller accounts for the VAT.

Do I charge VAT on exports from my own website?

Goods sold to customers outside the UK from your own website can be zero-rated as exports, provided you hold valid proof of export.

Sources

VAT and selling goods using an online marketplace — GOV.UK
VAT on goods sold from overseas — GOV.UK
Register for VAT — GOV.UK