Selling to UK consumers from overseas: the £135 VAT rule and when you must register (2026)
Updated 2026-07-23
For overseas sellers, the UK VAT answer starts with where the goods are at the point of sale. Then split the order by channel, consignment value and customer type.
Unsure if these rules apply to you?
Step 1: goods outside the UK at the point of sale
If the goods are outside the UK at the point of sale, start with the consignment value. HMRC says consignments of £135 or less sold directly to UK customers from overseas have UK VAT charged at the point of sale.
The £135 limit applies to the total consignment value, not to each item in the parcel. For consignments valued above £135, HMRC says normal VAT and customs rules apply on importation instead.
Step 2: DTC checkout or marketplace
For DTC orders, HMRC's direct-sales guidance puts the point-of-sale VAT work on the seller for qualifying consignments. The seller needs the correct VAT rate, VAT registration position and records for those sales.
For qualifying marketplace orders, HMRC's marketplace guidance says the online marketplace is liable for the VAT. Keep marketplace orders separate from DTC orders because the channel changes who must charge and account for VAT.
Step 3: B2C, B2B and UK stock
HMRC's direct-sales page gives a separate B2B treatment where the UK customer provides a VAT number. Do not use a consumer-sales conclusion for VAT-registered business buyers.
If an overseas seller owns goods already located in the UK at the point of sale, UK VAT needs a separate review. Direct sales from UK stock can create a first-sale registration question for the overseas seller, while qualifying marketplace sales can move VAT accounting to the marketplace.
Situations requiring separate review
For direct sales above £135, HMRC's direct-sales guidance says normal VAT and customs rules apply on importation instead. DDP terms, B2B reverse charge, zero-rated goods, Northern Ireland cases, and marketplace seller-of-record terms require separate review.
Before registering or changing checkout tax settings, prepare UK inventory records, marketplace and DTC sales, order values, customer type and import terms for a VAT professional to review.
Primary sources
This page is grounded in the primary materials below. Rules change, so open the source and confirm the current version before acting.
FAQ
Does the £135 rule apply per item or per consignment?+
HMRC says the £135 limit applies to the value of the total consignment imported, not to each separate item in that consignment.
Who accounts for VAT if the order is placed through a marketplace?+
For qualifying overseas marketplace sales, HMRC guidance treats the online marketplace as liable for the VAT. The seller still needs to review UK stock, B2B cases, goods above £135 and DTC sales separately.
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