VAT and your eBay business


“I make a small profit from buying and selling on eBay. Do I have to register for VAT, and charge VAT on the items I sell?”

Are the eBay sales a business?

Stock in warehouseVAT is a tax charged on sales made in the course of running a business, so the first step is to establish whether you are in fact running a business, or just selling unwanted items which were bought for private, personal use.

The difference between a business and personal buying and selling is not always clear. In borderline cases, the tax office will look at a combination of factors to decide on your status. The main issues to consider are:

- What was the item, and what was your motivation for buying it?
- What was the item used for before it was sold?
- How much time elapsed between buying and selling?
- Is your buying and selling organised like a business?
- What was your motivation for selling the item?
- Was it an isolated transaction, or one of a repeated series of similar transactions?
- How often do you buy and sell items?

You cannot avoid tax on your eBay activities simply by labelling it your “hobby”, if the reality is that it is more like a business. It is also irrelevant whether you are registered as a private seller or as a business with eBay or PayPal.

Do you have to register for VAT?

If you establish that your online selling does in fact represent a business, the next question is whether the person running it needs to register for VAT.

The most likely situation that would need VAT registration is where your turnover over the last 12 months (or less) has gone over the VAT registration threshold. Recent VAT registration thresholds have been:

Up to Threshold
31 March 2016 £82,000
31 March 2015 £81,000
31 March 2014 £79,000
31 March 2013 £77,000
31 March 2012 £73,000

It is important to understand that:

It is the total sales value (including the postage), before any expenses, that is relevant, not just the profit.

If you go over the threshold before 12 months have passed, you must register sooner. You don’t wait until the end of 12 months.

It is a rolling 12-month period. At the end of every month, you look back over your sales for the past 12 months (or less), to see if you have now gone over the threshold. You do not wait until the end of your accounts year to check.

Example

John starts an eBay business in January, and his sales grow rapidly:

Month Monthly sales
January 2014 £3,000
February 2014 £6,000
March 2014 £9,000
April 2014 £12,000
May 2014 £15,000
June 2014 £18,000
July 2014 £21,000

His sales go over the threshold of £81,000 in July, so he has the month of August to register for VAT, which will take effect from 1 September.

Further points

You do not need to include items which are exempt from VAT, such as some works of art. Some items often thought to be VAT-free, such as books, and some food products, actually have VAT charged at 0% (they are “zero-rated”), but they are not exempt from VAT and must be included in the calculation.

If you are selling mainly zero-rated items, so that you are charging very little VAT but reclaiming a lot of VAT on your expenses, you can ask for exemption from registration.

If you went over the threshold due to an exceptional, one-off event, and you can persuade HMRC that you will not be over the threshold in the future, you can ask for exemption from registration.

If you have any other businesses, whether on eBay, Amazon or any other type of business, the turnover from each of them has to be aggregated for the purpose of determining whether you have gone over the threshold. You cannot avoid VAT registration simply by splitting your business across different trading names, different eBay accounts or different product types. It is the person who has to register for VAT, not the business.

Even though exports often do not have VAT charged, they all need to be included in your sales figures for the purpose of determining whether you have gone over the threshold. This is because the VAT “place of supply” rules for goods state that if an item is sent from the UK to a customer outside the UK, it is considered to be a UK sale (though as an export it is often zero-rated). This basically means (examples):

  • If you post an item from the UK to your customer in the USA, it is a UK sale and needs to be included.
  • If you dropship an item from China directly to your customer in the USA, it is outside the scope of UK VAT.

Once you are registered for VAT, you must charge VAT on all your sales within the UK at the usual VAT rate. Any compulsory extra charges for freight, shipping, postage or delivery should be charged at the same rate of VAT as the rest of the items in that shipment.

Once registered, you can generally reclaim the VAT on your business expenses.

Both the VAT that you have to pay, and the VAT that you can reclaim, are reported quarterly to HMRC.

Exports

You do not need to charge VAT on items you are exporting, as long as you keep documentary proof of export. If the item is sent to another country within the EU VAT area, you also need to obtain the customer’s VAT number. If they do not have one, typically because they are a non-business customer, you must charge the usual rate of UK VAT.

Most European countries are in the EU VAT area, but Jersey and Switzerland are not. An item sent to the Republic of Ireland counts as an export. An item sent to Northern Ireland is not an export.

For VAT purposes it is physical movement of goods that is relevant, rather than the invoicing name or address. A sale to an overseas customer when the items are not leaving the UK will not normally be classed as an export, and UK VAT would be chargeable. However, items being sent overseas on behalf of a UK customer without an overseas VAT number are still subject to UK VAT at the usual rate (even if the customer is registered for VAT in the UK).

If you sell a lot of items to non-business customers in any individual EU country, you might need to register for local VAT in that country, to charge and pay the local equivalent of VAT there. This takes those sales outside the scope of UK VAT. This is called “distance selling”. Different EU countries have different limits for when you have to start doing this, though it is typically either 35,000 euros or 100,000 euros per calendar year.




63 Comments (oldest first)

  1. Pete

    I have recently started dropshipping on ebay, which means I source items from other online suppliers and sell them for a profit on ebay.

    However, I never have ownership of the items as they are ordered and sent (dropshipped) directly from the supplier.

    In this instance what counts as turnover for VAT registration purposes?

    2 March 2015

  2. Admin

    You will have to be more specific about the country of your supplier, the country of your customer, and what your terms of sale say about when ownership passes to your customer.

    2 March 2015

  3. Pete

    Mostly US suppliers (about 5% UK) Customer locations are in the same ratio. My terms state that the items are supplied by third parties nothing specific about ownership

    5 March 2015

  4. Admin

    An item shipped from one location in the US to another location in the US is outside the scope of UK VAT.

    6 March 2015

  5. Mike

    Hi, I have been reading some of your posts with much interest and I would like to thank you for a great resource and very useful info.

    Simple, clear & precise answers to many varied questions.

    Bookmarked for future ref.

    6 March 2015

  6. Jack M

    Since Jan 2015 eBay have not been charging me VAT on my fees, I am registered with HMRC but not for VAT as I only have a small turnover, how do I now account for the VAT, also Amazon stated that they will be giving me a refund on the VAT I paid since I registered with them, how do I account for this refund? very confused

    9 March 2015

  7. Admin

    What a confusing question. I am going to assume that with both companies, they have stopped charging you VAT on their fees because they are supplying their service from overseas, and you have confirmed to them that you are in business.

    “how do I now account for the VAT”

    You won’t need to do anything immediate with it, but you might need to include the value of their charges in your turnover when determining whether you need to register for UK VAT.

    “how do I account for this refund?”

    In your accounting records, you deduct this refund from your record of their charges, which presumably did include VAT when you originally recorded them.

    9 March 2015

  8. Jack M

    Thank you so much you have answered this for me

    Many many thanks

    9 March 2015

  9. David

    Hi there.
    great blog. i have a question for you im currently unemployed and looking into starting my own eBay business a drop shipping one which means no stock is required. i was wondering would i need to register as self employment if my income from profit is below my 10k a year of personal allowance? hope you can reply soon ty.

    9 March 2015

  10. Admin

    Yes, you would need to register. All such non-VAT related eBay matters are dealt with at http://www.brighton-accountants.com/blog/ebay-income-tax/.

    10 March 2015

  11. Russ

    Hi,

    i have a question regarding e-bay sales. Ummmm have you heard that question before? This has probably been answered before but i cannot find.

    My ‘real’ job pays over the lower limit so i already pay PAYE tax, NI etc.
    I have bought some items to sell on ebay. These have been bought to make a bit of additional income. I expect no more than 1k profit in first year (although i am buying to sell i.e business).
    I have already paid 20% tax on these to the company i purchased off.
    My ebay/paypal fee is about 15% on the total sale.
    My profit margin on each item is small.
    Does the tax man still take a 20% cut on my small profit if i dont register as a business even though i’ve paid VAT on the items and total sale price?

    Thanks

    31 March 2015

  12. Admin

    You are confusing VAT with income tax. They are completely separate, and you are liable to pay both.

    “I have already paid 20% tax on these to the company i purchased off.”

    That would be VAT. If you are not VAT-registered, then that payment of VAT is not relevant. The total price you paid is your cost.

    “Does the tax man still take a 20% cut on my small profit if i dont register as a business even though i’ve paid VAT on the items and total sale price?”

    Yes. If you have enough other income to be paying tax, and your eBay activity is organised like a business and with a profit motive, then you are liable to register for income tax and pay it on any profit, regardless of how low that profit is.

    31 March 2015

  13. marti

    RE It is the person who has to register for VAT, not the business.

    How do you stand with the vat limits when its a 50 50 split partnership? I think going vat registered my close our business. We have only recently started therefor have not hit the 82k yet but we are doing well, approx turnover of £3000 per week, weekly profit of around £1200-£1400 before tax. That is split between 2 of us, any advice on vat? Thanks

    12 May 2015

  14. Admin

    The VAT limit of £82,000 applies to the partnership as a whole. You do not get £82,000 per partner.

    12 May 2015

  15. Alexa

    Hi, I recently started a sole trader company in Sweden. The purpose of my company is to design and manufacture clothing and accessories to be sold at retail in uk, I am not going to sell in Sweden. My turnover is going to be under £82.000 for a while, do I need to register for VAT in uk or wait until reach that turnover in a period of 12 months?

    Thanks in advance for your reply.

    1 June 2015

  16. Admin

    Are you selling to businesses in the UK, or direct to consumers (ordered online then sent from Sweden to UK by post)?

    1 June 2015

  17. Alexa

    I am going to send my production to Amazon UK and then costumers can buy them. Amazon sent the goods from UK.

    1 June 2015

  18. Admin

    So you invoice Amazon UK, and they pay you? Or are Amazon just acting as a portal?

    1 June 2015

  19. Alexa

    That is correct, customers pay Amazon, Amazon pay me.

    1 June 2015

  20. Admin

    Which of my 2 options was correct? Have you sold the goods to Amazon, or are they acting as an agent, just handling the money?

    1 June 2015

  21. Alexa

    I have not started to sell but Amazon acts as a storage and will send the goods to customers when they buy them, customers pay Amazon and Amazon pay me each 14 days. I will pay Amazon for storage, packing, shipping and selling fees, but I am not sure yet about Invoicing.

    1 June 2015

  22. Admin

    OK, we can pick this up again when you know about the invoicing. Details are extremely important in tax.

    1 June 2015

  23. Alexa

    This is what I found about Invoicing when selling through Amazon: Amazon does not issue VAT invoices on behalf of sellers. It is your sole responsibility to comply with all legal and VAT requirements for issuing VAT invoices to buyers in respect to your sales transactions.

    1 June 2015

  24. Admin

    OK, well it looks like you are selling direct to the consumer. In this case, the “distance selling” regulations apply. Broadly, you have to register for UK VAT once your sales to UK consumers exceeds £70,000 per year.

    3 June 2015

  25. ben

    Great blog , a similar question to the people above , i am full time employed which all taxes and Ni is payed on monthly basis
    Q1 I have started buying goods from EU countries and sell on ebay ,, every item i buy i get charged the price agreed including the Vat which in this case is 20% , how can i claim back? the sales are around 30k a year but the profit is is only 10%-20% which in this case i have to pay ebay fees as well
    Q2 Do i need to become self employed to claim anything back ? hope you are able to respond many thanks Ben

    15 July 2015

  26. Admin

    There is no way to claim this back. If you are registered for VAT in the UK, you can give your EU suppliers your UK VAT number, and then they do not need to charge you their EU VAT.

    If you are selling £30K per year, you are already self-employed. Being registered as self-employed has nothing to do with the VAT.

    15 July 2015

  27. Josh

    Hey so i am new to vat and have a question.

    1. I purchase a product from lets say toy from Tesco who charge me £10 including VAT on the item.
    2. I re-sell the item on amazon for £20.00

    do i need to add the vat on top of the item price that i am selling it on amazon so i need to list the product at £24.00 on amazon or do i list it as £20 and amazon sort out the vat?

    this is really going to eat into my profit margins :( can anyone give any advice?

    12 August 2015

  28. Admin

    You have to account for VAT on whatever amount you receive. If you list it and sell it for £20, you will owe HMRC £3.33. If you list it and sell it for £24, you will owe HMRC £4.00. Amazon are not going to sort out your VAT for you.

    Don’t forget that you might be able to reclaim the VAT on items which you purchase.

    12 August 2015

  29. Leo

    Hi. I have a question. I’m a registered self employed person (own a UTR number) buying handmade stuffs from a EU country and resell them on eBay to UK customers. My question: Can I use my supplier’s invoice for the goods that I buy as being my expenses, when doing the tax return, although it is being issued in a different language? Thank you

    15 August 2015

  30. Admin

    Yes, of course.

    15 August 2015

  31. Leo

    And different currency as well. how do I convert between currencies? Thank you for your quick response

    19 August 2015

  32. Admin

    Simplest is to use the Sterling amount which left your bank account or credit card when you paid for the items.

    20 August 2015

  33. BPE

    Hi, firstly thanks for creating this resource. Found it very clear and thus very useful.

    Im an online seller, registered as sole trader and recently went over the VAT threshold. I use 3 sites to sell from, ebay, etsy and own site. Our average sale price is under £5 so took lots of sales to go beyond the threshold. We have about 50% of our sales going to America, about 10% to Europe , about 2% rest of the world with the UK being the other 38%.

    I’m unsure how to work out what I need to pay in VAT for the sales as a lot of my sales are to countries that are “zero rated” . Non of the sales points (Paypal, shopify and etsy payment account) seem to make this easy/possible.

    For example with paypal, the data file that I’ve downloaded showing each month doesn’t allow to organise by country, which I need to be able to do. Tried to do it by ebay instead of paypal, the data seems more useful in that it can be split by nation, but there is no refund data, so if I use this data some items that were refunded I’ll be getting charged VAT for. Sorry to ramble, feels like I’m missing something really obvious?!

    The flat rate has been suggested by my current accountant tho I noticed that you have suggested in situation where selling internationally that the flat rate system might not be the best system - why is this?

    Also is it true that In your first year as a VAT-registered business the rate is reduced by 1% until the day before your registration anniversary?

    Thanks

    31 August 2015

  34. Admin

    “I’m unsure how to work out what I need to pay in VAT for the sales as a lot of my sales are to countries that are “zero rated” . Non of the sales points (Paypal, shopify and etsy payment account) seem to make this easy/possible.”

    It is probably not helpful to think simply in terms of “zero rated countries”. Exports outside the EU VAT area are potentially exempt, but only if proof of export is kept. You will have to design a system that identifies the country of export for each sale, and whether you have the proof of export. Expecting to simply read the country off a PayPal report, and calculate your VAT directly from that, is probably a bit too optimistic.

    “The flat rate has been suggested by my current accountant tho I noticed that you have suggested in situation where selling internationally that the flat rate system might not be the best system - why is this?”

    Under the flat rate scheme, you will have to pay VAT on all your exports, whereas under normal VAT accounting, they will probably be zero-rated.

    “Also is it true that In your first year as a VAT-registered business the rate is reduced by 1% until the day before your registration anniversary?”

    Yes, on the flat rate scheme.

    2 September 2015

  35. Paul

    Hi, great blog. Really useful.
    I have a question regarding vat and selling to USA from UK. I am a sole trader and not VAT registered. I have a non business customer wanting a product that I purchased from a support and paid the VAT on originally on cost price.
    I understand that with the product leaving the UK for the U.S. Then zero rating is applied. But do I have to complete a declaration of export if I am not vat registered?

    8 September 2015

  36. Admin

    “I understand that with the product leaving the UK for the U.S. Then zero rating is applied.”

    Yes, but only if you have proof of export. People always seem to forget that detail.

    “But do I have to complete a declaration of export if I am not vat registered?”

    Potentially. Apart from possibly forming part of your proof of export for VAT records purposes, export declarations are nothing to do with VAT.

    9 September 2015

  37. Guy

    Hey,

    How does this work as a consumer from outside the EU?

    As an example, I recently purchased an item from a seller based in Italy, importing to South Africa. I believe I was charged VAT @ 21% per the details of the item. Does this mean that I’m not required to pay VAT locally or am I able to reclaim the difference between my local and EU VAT rates?

    Or was I not required to pay the EU VAT in the first place?

    14 September 2015

  38. Admin

    For an export outside the EU, Italian VAT should not have been charged, though it might have been part of a tax-inclusive price which you agreed to pay.

    Separately, the South Africa government are likely to charge some form of import tax, without giving you credit for the Italian VAT already paid.

    14 September 2015

  39. Dean

    Hi,
    I could do with a little help.
    I am a self employed plumber and do a yearly tax return at present.

    Now, I currently have two buying and selling ideas which I will be doing through Ebay and Amazon.

    One of the ideas will have a turnover higher than the VAT rate hopefully by year one and the other maybe half way.

    There both completely different types of items so was thinking of registering a company name to run both through. If that’s ok ?

    The companies I will be buying from for both types of goods are VAT registered.

    Can I register a business name for VAT and a business bank account in this business name but have different business names on the invoices ?
    Basically I have registered to buy from these two different companies with different business names (which are not registered with HRMC) because one isn’t relevant to the other.

    Wondering if I register a business with a bank account called for example TIMS TRADING
    TIMS TRADING is the name on the business bank account.
    Now my ebay business is called (example) FREDS FIRES
    Amazon business BURTS BUTTONS
    Can both of these use TIMS TRADING for buying and selling goods or does everything need to be separate with separate bank accounts.

    Do I need to be a LTD company ?

    Also, if continue to do plumbing am I now VAT registered ?
    The plumbing company also has a different name but has own business bank account.

    If I start up TIMS TRADING does all my plumbing need linking with it all too ?

    Thanks for your time and sorry for being sooooo clueless :)

    29 September 2015

  40. Admin

    VAT registration applies to an entity, ie a person or a limited company, and covers the whole of their business activities. It does not apply just to a “business”, a trading name or a bank account, though there are provisions to stop one business being artificially split across 2 entities to avoid VAT registration.

    30 September 2015

  41. Helga

    Hello, just stumbled on this fantastic blog.

    I am a sole trader in the UK. my business’ annual turnover is less than £60k, so I am not VAT registered.
    I have recently started trading with Germany, and my partners there ask that I put my VAT on all documentation and also charge VAT on my products. Does that mean I have to register for VAT and do what I’m told?

    It’s very confusing and I would appreciate your help!

    Kind regards,
    Hega

    30 September 2015

  42. Admin

    Your partners in Germany have no business telling you what to do about your VAT. They are probably confused because all German businesses have to register, regardless of size.

    30 September 2015

  43. Paul

    Hi,

    Really interesting blog!

    I have a quick question which you may find very simple to answer, so please forgive my poor understanding.

    I am not VAT registered, and way under the threshold.

    I am using some inventory software that prepares sales invoices for me automatically. Unfortunately I cannot set the software up so that it doesn’t display “VAT @” whatever rate ie this line is removed from the invoice.

    I have entered in the system that my default VAT rate is 0%, seeing as I am not VAT registered.

    So the software generates an invoice that for example looks like this:
    ———————-
    1 x Item £100
    ———————-
    Net total £100
    VAT amount £0
    Rate (0%)
    Total Incl VAT £100
    ———————-
    As a non VAT registered small business, can I legally issue an invoice like this with VAT stated at zero?

    Any help would be much appreciated.

    Thank you.
    Paul.

    4 October 2015

  44. Admin

    Yes, that’s fine.

    4 October 2015

  45. Joe

    Hi there. I am another sole trader selling on Amazon UK. My turnover is nearing the threshold for VAT registration but as I understand things I don’t want to have to register for VAT.

    I believe I would effectively end up paying VAT and income tax on my profit as my prices are determined by the marketplace so would stay the same, and nearly all my sales are of 20% vatable goods and to non-business customers in the UK or EU.

    In fact as I buy a substantial proportion of my stock from non-VAT registered suppliers the percentage I’d end up paying on my profit would be higher than just VAT plus income tax rates as I wouldn’t be claiming the VAT back (in effect) on those stock purchases.

    My profits to date have only been a little over my personal allowance for non-taxed earnings annually. This year I am doing better but my turnover is a lot higher, so if I VAT register I believe I am also looking at paying HMRC the 1/6 VAT chunk of that first £10000 ish of profit which has made up my personal allowance to date.

    It seems to be a ‘poverty trap’ situation as I can’t see an obvious way to avoid having to register other than actively keeping my turnover below the threshold. Can you advise me of any other options I might have, or would I just need to bite the bullet if I wanted to expand?

    Thanks so much for any help you can offer.

    Joe

    1 November 2015

  46. Admin

    “In fact as I buy a substantial proportion of my stock from non-VAT registered suppliers the percentage I’d end up paying on my profit would be higher than just VAT plus income tax rates as I wouldn’t be claiming the VAT back (in effect) on those stock purchases.”

    Yes, but that would be the case regardless of whether or not you are VAT registered yourself.

    “…so if I VAT register I believe I am also looking at paying HMRC the 1/6 VAT chunk of that first £10000 ish of profit which has made up my personal allowance to date.”

    No, the VAT is a 1/6 chunk of your turnover, not of your profit. Assuming that you have negligible input VAT to reclaim, registering for VAT will cost you around £13,000.

    “It seems to be a ‘poverty trap’ situation…”

    True, but the registration threshold has to be set somewhere, and wherever it was set, someone would find it unfair.

    “Can you advise me of any other options I might have, or would I just need to bite the bullet if I wanted to expand?”

    I don’t have any magic solutions for you. If you can split your business genuinely and cleanly into 2, you might be able to split it between yourself and a limited company, but you would need professional assistance with that.

    1 November 2015

  47. Joe

    Hi. Thanks so much for the quick response to my open ended and slightly rambling query.

    I have never gone online asking for advice about anything in the past so I’m not really sure what the protocols are. Is it ok if I ask a few more questions?… For instance:

    If my rolling 12 month turnover were to hit the £82k threshold tomorrow, and I therefore immediately undertook to register, what period would my first VAT account have to cover?

    Again thanks so much.

    Joe

    1 November 2015

  48. Admin

    You are welcome to keep asking questions. What I won’t answer is open-ended consultancy type questions (”Here is my complicated situation, how can I save the most tax?”), or where it is obvious that the person has not bothered to read the article properly.

    You first VAT period would start on 1 January 2016. I could not predict how many months it would cover, it might be 2, 3, 4 or 5, at HMRC’s discretion. After that, every VAT period would be 3 months, unless you ask to change it.

    1 November 2015

  49. Joe

    Thankyou!
    Ok…
    The most important question regarding my situation is this: as an Amazon marketplace seller my customers’ payments come to me via Amazon. They process the payments, and don’t actually debit the customer until I’ve notified them that purchases have been dispatched. They take a fee out at source and credit my account with the remainder of each payment. So I never actually see the full price as advertised on site and paid by customers of the goods I sell, but only what remains after Amazon fees are paid. However, and this is the question, my turnover will comprise the sum of the full prices of my sales (plus postage charges I have been given to believe, I think above somewhere), right, and not just the money passed on to me by Amazon after they’ve taken their fee out? I.e. the customer is paying me, and I am paying Amazon, even though this isn’t the actual order of events. My turnover would not immininently be going over the threshold if it only comprised the money I realise on sales after I’ve paid Amazon’s fees, hence the importance of the question.
    Regards, Joe

    1 November 2015

  50. Admin

    That is a question which I cannot properly answer, as it depends on the detailed terms of your arrangement with Amazon, and a lot depends on the answer. My guess would be that Amazon are your processing agent, not your customer, so your turnover will comprise the amount charged to the online shopper.

    1 November 2015

  51. Joe

    Hi again.
    I have read online on the government VAT advise site that at any given time I need to register if my turnover for the preceding 12 months exceeds the threshold, UNLESS I expect my turnover in the next 12 months to be less than the deregistration threshold. I have read of applying for an exception from registration if my turnover goes over the threshold temporarily but I guess I don’t need to apply if the above is the case?
    Joe

    2 November 2015

  52. Admin

    These are both the same thing. It is called “exception from registration”, and you need to apply for it as soon as you go over the threshold. You cannot just keep quiet about it.

    2 November 2015

  53. Joe

    Great. Thanks very much for the help. My next stop is the tax office for advice, and to apply for exception, or to register…

    2 November 2015

  54. Joanna

    Your blog is extremly helpfull! I have a quick question, it confuses me a lot.

    When i import goods from Poland to sell on ebay with profit, and - asumme that i am registered for VAT - i do not pay VAT at the time of purchasing goods then, when selling them on ebay I charge further 20% VAT but when and to who I need to pay this VAT? If it is payable, can I reclaim it?

    Also, if bussiness turnover will be around 30k or less, would you recommend to register for VAT or not?

    6 November 2015

  55. Admin

    “asumme that i am registered for VAT - i do not pay VAT at the time of purchasing goods then, when selling them on ebay I charge further 20% VAT”

    This is not further VAT, this is the ONLY VAT.

    “when and to who I need to pay this VAT?”

    Usually quarterly, to HMRC, once you have registered for VAT with them.

    “If it is payable, can I reclaim it?”

    No.

    “Also, if bussiness turnover will be around 30k or less, would you recommend to register for VAT or not?”

    Probably not, but I cannot give a proper answer based on the bare bones information which you have supplied.

    6 November 2015

  56. antony thomas

    good evening, i run a small ebay business alongside my full time employment and i am making around £1000 a month turn over from this business. to gain access to better prices and more products a lot of wholesale sites and import sites in the uk require a VAT number. is there any way around this and if not how do i come VAT registered while still in full time employment? or is the only way around this becoming self employed?

    7 November 2015

  57. Admin

    There are a lot of misconceptions here.

    Be aware that:

    Your VAT registration is completely independent of your employment status.

    If you run a business by yourself which is not a limited company, then by definition you are self employed.

    You can be self employed at the same time as being employed. See http://www.brighton-accountants.com/blog/tax-self-employment-still-employed/.

    8 November 2015

  58. Christian

    Hello,

    We’ve started a dropshipping business in May of this year and we’re wondering if there’s a way around our problem. The problem is that we don’t really have high profits as we keep our prices competitive. So in other words turnover is high and profit is low. We will soon hit the VAT threshold, and as we are not in a position to increase our prices this will make it hardly worth doing. Is there any way round this?

    Regards

    9 November 2015

  59. Admin

    I don’t have any magic solutions for you. If you can split your business genuinely and cleanly into 2, you might be able to split it between yourself and a limited company, but you would need professional assistance with that.

    9 November 2015

  60. Nicety

    I am an Irish, living in Ireland and have registered a business in Ireland (Not VAT registered yet).

    I am planning to start online retail e- commerce business in ireland (eBay) and the model is such that I will take orders from Irish individuals and will ask supplier from HongKong to ship items directly to individual buyers (Drop ship model). Buyers will pay Vat and duties if any.

    As per this link:

    There is no VAT threshold for distance selling for my case right?

    which means I need not register for VAT even if I cross sales of 35,000 EUR correct?

    The income that I derive in this business will be subjected to income tax and I will pay that.

    Please let me know the answers as I have been searching answer for this from such a long time.

    Thanks

    16 November 2015

  61. Admin

    “I am an Irish, living in Ireland and have registered a business in Ireland (Not VAT registered yet).

    I am planning to start online retail e- commerce business in ireland (eBay) and the model is such that I will take orders from Irish individuals and will ask supplier from HongKong to ship items directly to individual buyers (Drop ship model). Buyers will pay Vat and duties if any.”

    You need advice from an Irish accountant, not a UK one.

    17 November 2015

  62. Joe

    Hello,

    I run a small part time limited company, selling on ebay, yearly turnover 5k, so I am not registered for VAT. Some of my customers are from the EU, do i have to register for UK VAT and charge VAT to them, or I am fine as far as I am below the treshold.

    Thanks

    18 November 2015

  63. Admin

    With that level of turnover, you do not need to do anything with VAT.

    19 November 2015