Key takeaways

  • A UK seller on Amazon, eBay or Etsy must register for VAT when taxable turnover across all sales channels passes £90,000 in any rolling 12 months.
  • Today the marketplace collects VAT only on sales by overseas sellers and on imported consignments worth £135 or less; UK sellers account for their own VAT.
  • From October 2027, marketplaces will also collect VAT on consumer sales by UK sellers who are VAT-registered or sell more than £90,000 a year on one platform.
  • The October 2027 rules will not cover personal sales, second-hand goods or business-to-business sales.
  • Platforms report sellers to HMRC under the digital platform rules unless they have fewer than 30 sales and €2,000 (about £1,700) or less in a year.
  • VAT records, including VAT invoices, must be kept for 6 years under HMRC's marketplace guidance.

If you are a UK business selling on Amazon, eBay or Etsy, you account for your own VAT today, and you must register once your total taxable turnover passes £90,000. The marketplace only collects VAT for overseas sellers and small imports. That changes in October 2027, when marketplaces will start collecting VAT on many sales by UK sellers too.

Do online sellers have to register for VAT?

You must register for VAT when your taxable turnover goes over £90,000 in any rolling 12-month period. GOV.UK’s registration rules apply to marketplace sellers in the same way as shops.

Taxable turnover means the total of all your VAT-taxable sales, not your profit. Add together sales on every platform, your own website, markets and any other channel. If you sell £50,000 on Amazon and £45,000 on Etsy, you are over the threshold.

There are two tests:

  1. Looking back. If your turnover for the last 12 months passes £90,000, register within 30 days of the end of that month.
  2. Looking forward. If you expect to pass £90,000 in the next 30 days alone, register by the end of that 30-day period.

Use our VAT threshold tracker to keep a running total, and see VAT registration for how to apply.

Who collects VAT on marketplace sales today?

UK-established sellers collect and pay their own VAT. The marketplace is only responsible in two cases, under rules in force since 1 January 2021 and set out in HMRC’s online marketplace guidance:

Seller and goodsWho accounts for VAT
UK seller, goods in the UKThe seller, if VAT-registered
Overseas seller, goods already in the UKThe marketplace
Imported consignment of £135 or lessThe marketplace
Imported consignment over £135Normal import VAT and customs rules

The £135 limit applies to the whole consignment, not each item. Sales to a VAT-registered UK business that gives its VAT number are treated differently: the business customer accounts for the VAT.

What a VAT-registered UK seller does now

  • Charge VAT at the right rate on every sale, usually 20%.
  • Include the VAT in your marketplace listing price.
  • Report the sales on your VAT return through Making Tax Digital software.
  • Reclaim VAT on stock and business costs, including marketplace fees, where you hold a valid VAT invoice.

What changes in October 2027?

From October 2027, the marketplace will collect VAT on sales of goods to consumers by UK businesses, where the goods are in the UK when sold. Budget 2026 announced this on 28 October 2026.

The HM Treasury factsheet says it applies to:

  • UK businesses that are VAT-registered, for all qualifying marketplace sales
  • UK businesses that are not VAT-registered but sell more than £90,000 a year on any single platform

It does not apply to:

  • occasional personal sales, such as your own clothes or household items
  • second-hand goods sold by businesses, which carry on charging VAT as now
  • business-to-business sales

The £90,000 applies separately to each platform. This test does not change your own duty to register. A seller with £60,000 on eBay and £60,000 on Amazon would still need to register for VAT, even though neither platform collects VAT for them as an unregistered seller.

HMRC says it will publish detailed guidance before the start date. We cover the detail in online marketplaces to collect VAT for UK sellers.

What is not yet known

The factsheet does not explain how your VAT return will change or how input VAT will be handled. If the platform pays your output VAT, your return may mostly show VAT you reclaim, and you may receive repayments. You will also lose the cash flow benefit of holding sales VAT until your return is due. Wait for HMRC’s guidance before changing your systems.

Will HMRC know what I sell?

Yes, in most cases. Under the reporting rules for digital platforms, Amazon, eBay, Etsy and other platforms report details of their sellers and their income to HMRC.

Goods sellers are not reported if they make fewer than 30 sales and receive €2,000 (about £1,700) or less in a year. Being reported does not mean you owe tax. It means HMRC can check that you have declared what you should. Read more in digital platform reporting and tax on selling online.

Which applies to you?

  • If you sell your own unwanted belongings, you are not trading, and VAT does not apply.
  • If you trade but your total sales are under £90,000, you do not need to register, though you can register voluntarily.
  • If your total sales pass £90,000, register for VAT within the deadline, whatever each platform’s share.
  • If you sell second-hand goods as a business, look at the VAT margin scheme, and expect to keep accounting for VAT yourself after October 2027.
  • If you sell mainly to other businesses, the October 2027 change does not cover those sales.

What to do now

  1. Add up your last 12 months of sales across every channel.
  2. Download sales reports from each platform every month and keep them for 6 years.
  3. Check your listing prices include VAT if you are registered.
  4. If you are VAT-registered, model your cash flow without the sales VAT from October 2027.
  5. Watch for HMRC’s detailed guidance, expected before October 2027.

Frequently asked questions

Does Amazon pay VAT for UK sellers?

Not today. Amazon and other marketplaces collect VAT for overseas sellers and small imports. From October 2027 they will also collect it for VAT-registered UK sellers and those selling over £90,000 on one platform.

Do Etsy sellers need to register for VAT?

Only if total taxable turnover from all your sales passes £90,000 in a rolling 12 months. Etsy sales count towards that total alongside any other sales.

Is the £90,000 VAT threshold per platform?

The registration threshold is not. It counts all your taxable sales together. Only the October 2027 marketplace collection test for unregistered sellers applies per platform.

Do I pay VAT on selling my old things on eBay?

No. Selling your own personal belongings is not a business activity, and the October 2027 rules exclude occasional personal sales.

How long must online sellers keep VAT records?

HMRC’s marketplace guidance requires full records, including VAT invoices, to be kept for 6 years.

Sources

Rates, thresholds and rules in this guide were checked against HMRC and GOV.UK guidance on 6 November 2026. Tax rules change, so check the current position on GOV.UK or with a qualified adviser before acting. This guide is general information, not personal advice.