This guide is for e-commerce companies that sell online via web-stores or at marketplaces.
VAT Standard rate
VAT Reduced rate
Some goods and services, eg children’s car seats and home energy.
Zero-rated goods and services, eg most food and children’s clothes.
For businesses established in the UK the digital supplies threshold is £8,818 (the figures before VAT is added). If the annual value of your total cross-border supplies of digital services to consumers in the EU in the current year and previous year is:
- Below the threshold, the place of supply is the UK
- Over the threshold, the place of supply is where the consumer is located.
If you are based outside the EU and supply digital services to consumers in the EU, the place of supply will be where the consumer is located.
The £8,818 digital services threshold does not apply and you’re responsible for accounting for VAT on the supply regardless of the value of the sales.
If goods or services were used to make taxable supplies in the UK, VAT in input invoices might be credited. For example:
- VAT paid at custom clearance with your EORI number
- VAT paid to the UK suppliers
You may be able to reclaim VAT paid on goods or services bought before you registered for VAT if the purchases were made within certain time limits.