UK ecommerce businesses must register for VAT once taxable turnover passes £90,000 in any rolling 12-month period, or if you expect to pass it within the next 30 days. You register online through your HMRC Government Gateway account, and most VAT numbers arrive within about 10 to 30 working days. Sales through Amazon, eBay, Etsy, Shopify and TikTok Shop all count towards that threshold.
That last point trips up more online sellers than any other. This guide covers exactly when you cross the line, how to register step by step, how VAT works when you sell through online marketplaces, what changes for EU sales, and what you must do the day your VAT number arrives. Every figure here was checked against gov.uk on 28 July 2026.
When does an ecommerce business need to register for VAT?
You must register for VAT once your taxable turnover exceeds £90,000 in any rolling 12-month period, or when you expect to exceed £90,000 in the next 30 days alone. The threshold has been £90,000 since 1 April 2024 and is frozen at that level for 2026/27. Businesses under it can still choose to register voluntarily.
The words "rolling 12 months" are where sellers slip up. It is not your accounting year or the tax year: at the end of every month you add up the last 12 months of taxable sales. The day that running total tops £90,000, the clock starts. Per HMRC's guidance on VAT thresholds, two separate tests can trigger registration:
- The backward look: your taxable turnover for the last 12 months goes over £90,000. You must register within 30 days of the end of the month you went over, and VAT applies from the first day of the second month after you crossed it.
- The forward look: you expect taxable turnover to go over £90,000 in the next 30 days on its own, say a single large wholesale order or a product that goes viral. You must register by the end of that 30-day period, effective from the date you realised.
| VAT threshold (2026/27) | Amount |
|---|---|
| Registration (rolling 12 months) | £90,000 |
| Deregistration | £88,000 |
| Standard VAT rate | 20% |
The deregistration threshold is £88,000: if your taxable turnover falls below it you can ask HMRC to cancel your registration. For the plain-English version of the rules, see our guide on when you need to register for VAT.
Do marketplace and multi-channel sales count towards the £90,000 threshold?
Yes. If you are a UK-established seller, the sales you make through your own website and through marketplaces such as Amazon, eBay, Etsy and Shopify all count towards a single £90,000 threshold. There is one threshold for your whole business, not one per channel, so a seller spread across three platforms can cross it without any single channel looking large.
The main exception is where an online marketplace is treated as the "deemed supplier" and accounts for the VAT itself, covered further down. That mostly affects overseas sellers and low-value imported goods, not a UK seller shipping their own UK stock. If you sell across several channels, our guides to VAT accountants for UK ecommerce and Shopify accounting for UK sellers show how to pull the numbers together.
Should ecommerce sellers register for VAT voluntarily?
Voluntary registration below £90,000 lets you reclaim VAT on stock, marketplace fees and equipment, and can add credibility with suppliers. The trade-off is real: you then have to add 20% VAT to your prices. If most of your customers are consumers who cannot reclaim it, that either eats your margin or pushes your price up. If you sell mainly to VAT-registered businesses, it usually works in your favour.
How do you register for VAT online as an ecommerce seller?
You register online through your HMRC Government Gateway account using the register for VAT service, or by post on form VAT1 if you cannot register online. Online is far faster: most VAT numbers arrive within about 10 to 30 working days, while the paper route can take several weeks.
| Method | Best for | Typical time |
|---|---|---|
| Online (Government Gateway) | Almost all sellers, the default route | About 10 to 30 working days |
| Paper form VAT1 (by post) | Those who cannot register online | Several weeks |
Step by step: registering through your Government Gateway
- Sign in or create a Government Gateway account. This is your login for HMRC's online services.
- Open the register for VAT service and choose the option that matches you: sole trader, limited company or partnership.
- Enter your business details and the reason you are registering, whether you have crossed the threshold, expect to, or are registering voluntarily.
- Submit and wait for your VAT number, which HMRC sends with your VAT registration certificate.
- Set up your VAT online account and MTD software so you can file returns and pay HMRC.
What you need before you start
Have these to hand so you can finish in one sitting:
- Your National Insurance number, and your business Unique Taxpayer Reference (UTR).
- Your company registration number and registered address, if you trade through a limited company.
- Business bank account details.
- Your turnover figures and the date you crossed, or expect to cross, the threshold.
- A Government Gateway user ID (you can create one during the process).
If you are not sure how to reach the right HMRC service, our guide to accessing your HMRC VAT account walks through it, and once you are registered you can find and download your certificate using our note on what a VAT certificate is.
What is your effective date of registration?
Your effective date of registration is the date from which you must charge VAT, even if your VAT number has not arrived yet. You cannot show VAT as a separate line until you have the number, so the usual approach is to raise your prices by the VAT amount in the meantime, then reissue proper VAT invoices once the number comes through. You can also reclaim some pre-registration VAT: on goods you still hold, going back up to 4 years, and on services, up to 6 months before registration.
How does VAT work when you sell through online marketplaces?
Since 1 January 2021, online marketplaces are the "deemed supplier" for certain sales, which means the marketplace, not you, accounts for the UK VAT. This applies to goods sold to UK customers where the goods are outside the UK in consignments of £135 or less, and to goods already in the UK that are sold by an overseas (non-UK-established) seller. HMRC sets this out in its guidance on overseas goods sold through online marketplaces.
For a UK-established seller shipping your own UK-held stock, the deemed-supplier rules do not apply. You account for your own VAT, and those marketplace sales count towards your £90,000 threshold as normal.
| Scenario | Who accounts for the UK VAT |
|---|---|
| Goods outside the UK, £135 or less, sold to a UK consumer via a marketplace | The marketplace |
| Goods already in the UK, sold by an overseas seller via a marketplace | The marketplace |
| UK-established seller shipping own UK stock via a marketplace | You, the seller |
| Goods over £135 imported, then sold | Import VAT at the border, then normal rules |
The £135 figure is the consignment value, not the price of a single item. Our deep dive on the £135 rule, OSS and IOSS for Amazon FBA works through how it applies to imported stock.
What is the 2026 marketplace VAT consultation?
On 23 June 2026 HMRC opened a consultation, Extending online marketplace liability to combat non-compliance, which runs until 18 August 2026. It proposes making marketplaces liable for VAT on some UK-established sellers' sales too, above a proposed platform threshold. It is a proposal only, not law, and has no start date, but it is worth watching if you sell through Amazon, eBay, Etsy or Temu.
What about selling to customers in the EU?
Selling physical goods to EU consumers brings EU VAT into play at the point of import. For low-value consignments of £135 (€150) or less, you can register for the Import One Stop Shop (IOSS), charge EU VAT at checkout, and file one monthly return instead of registering in every country. HMRC explains the UK route in its VAT Import One Stop Shop collection.
Above €150, or if you hold stock inside the EU (for example Amazon FBA in Germany or Poland), you may need to register for VAT in individual member states. Our guide to which EU countries an Amazon seller must register in walks through where and when.
What happens after you register for VAT?
Once registered you receive a VAT number and a VAT certificate, and you must start charging VAT (the standard rate is 20%) from your effective date, issue VAT invoices, keep digital records, and file VAT returns, usually quarterly, through Making Tax Digital compatible software. Returns are filed and paid one month and seven days after the end of each VAT period.
| Obligation | Detail |
|---|---|
| Charge VAT | Standard rate 20% from your effective date |
| File VAT returns | Usually quarterly, via MTD-compatible software |
| Return and payment deadline | 1 month and 7 days after the period ends |
| Keep records | Digital records for at least 6 years |
Every VAT-registered business now keeps digital records and files under Making Tax Digital for VAT, so pick MTD-compatible VAT software that connects to your sales channels. For the underlying rules, see gov.uk on VAT returns, VAT record keeping and VAT rates.
Which VAT scheme should an online seller choose?
Most ecommerce sellers stay on standard VAT accounting because they have plenty of input VAT to reclaim on stock and fees. The Flat Rate Scheme can suit very low-cost service sellers, Cash Accounting helps if customers pay slowly, and Annual Accounting cuts the number of returns. The right choice depends on your margins and channels, which our ecommerce VAT accountant guide compares in detail.
Common VAT registration mistakes ecommerce sellers make
- Counting only website sales and ignoring marketplace turnover that also counts towards the threshold.
- Watching the tax year instead of the rolling 12 months, so the threshold is crossed months before it is noticed.
- Forgetting the 30-day forward test after a large order or a viral product.
- Registering from the wrong effective date and under-collecting VAT you still have to pay HMRC.
- Not reclaiming pre-registration input VAT on stock on hand and setup costs.
- Assuming an overseas marketplace handles your VAT when, as a UK-established seller, you account for it yourself.
Get your VAT registration handled →
Frequently asked questions
What is the VAT registration threshold for ecommerce in 2026?
The threshold is £90,000 of taxable turnover in any rolling 12-month period, unchanged since 1 April 2024 and frozen for 2026/27. You must also register if you expect to pass £90,000 in the next 30 days alone. Sales through your website and through marketplaces both count.
Do Amazon and eBay sales count towards the VAT threshold?
Yes. For a UK-established seller, sales through Amazon, eBay, Etsy, Shopify and your own website all count towards the single £90,000 threshold. The main exception is where the marketplace is the deemed supplier, which mainly affects overseas sellers and low-value imported goods rather than UK stock.
How long does VAT registration take?
Most online applications through the Government Gateway produce a VAT number within about 10 to 30 working days. A paper VAT1 application can take several weeks. HMRC may ask for extra checks, which can extend the time.
Do I charge VAT before my VAT number arrives?
Yes. You must account for VAT from your effective date of registration, even before the number arrives. You cannot show VAT separately until you have it, so raise your prices by the VAT amount in the meantime, then reissue proper VAT invoices once the number comes through.
Can I register for VAT voluntarily as a small online seller?
Yes. You can register voluntarily below £90,000 to reclaim VAT on stock, fees and equipment and to add credibility. The catch is that you must then charge 20% VAT, which can raise prices for consumer customers who cannot reclaim it.
Talk to a Zmartly ecommerce accountant
Zmartly is CIMA-regulated and works with online sellers across Amazon, eBay, Etsy, Shopify and TikTok Shop. If you are near the £90,000 line or have just crossed it, we will confirm exactly when you must register, handle the application, and set up MTD-ready VAT returns so nothing slips. See our VAT services and ecommerce accounting pages, or book a free call.
Sources
- Register for VAT, GOV.UK
- How VAT works: VAT thresholds, GOV.UK
- VAT and overseas goods sold to UK customers using online marketplaces, GOV.UK
- Extending online marketplace liability to combat non-compliance, GOV.UK
- VAT Import One Stop Shop scheme, GOV.UK
All figures and thresholds checked against gov.uk on 28 July 2026. This article is general information, not advice for your specific circumstances.
