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Home > United Kingdom Value Added Tax
Information regarding United Kingdom Value Added Tax

The United Kingdom (England, Wales, Scotland and Northern Ireland) now requires internationally based vendors to register with the Her Majesty's Revenue and Customs (HMRC) and to collect Value Added Tax (VAT). This requirement came into effect on January 1st 2021, and is part of the new regulations surrounding BREXIT. There is no exemption offered to small businesses with low annual sales to the U.K.

See
https://www.gov.uk/guidance/vat-and-overseas-goods-sold-directly-to-customers-in-the-uk

I have however, found that I can sell to my UK customers through eBay, and eBay will collect, account for and remit the VAT for me.

The process is as follows:

  1. 1. You place your order on my site as normal. My site will estimate postage and a 10% "eBay Fee" to partially cover eBay's "Final Sale Fee". This fee should be for product and postage, but my site can only calculate on product. More on this in step 3 below.

  2. 2. Your can indicate "Mailing Cheque or Money Order" for payment. I will "VOID" any credit card or PayPal payment offered.

  3. 3. I will create a custom 'Buy it Now' item on eBay, which will be priced to include everything in your order plus the 10% "eBay Fee" mentioned in step 1. This Fee will be calculated on product and postage, and will be slightly more than my site calculated in step1, as my site cannot include shipping in the calculation.

  4. 4. I will send you a link to your order via email.

  5. 5. You then "Buy it Now" through eBay. eBay will recalculate shipping, and experience shows it is usually about 8% less than what my site calculates. eBay will also calculate and add the VAT, giving you a final total.

  6. 6. For orders under £135, VAT will be collected from you by eBay, and paid by eBay to HMRC. For orders over £135, eBay will not collect VAT, you will be responsible for paying it.

  7. 7. You complete your purchase and payment on eBay. eBay will notify me once you have completed this step.

  8. 8. I will then invoice and ship your order. As I do not collect the VAT, it will not show on your invoice. The difference between what I invoice and what you paid on eBay will be the VAT.

The reason for the "eBay fee" is that eBay extracts a "Final Sale Fee" of between 15% and 20% on product and shipping. I am asking my UK customer to pay the first 10%, I will pay the rest.

This process has now been tested many times with several customers, and it has worked very smoothly. I share your dislike of having to jump through the eBay hoop, and the added expense involved, but as I have no desire to play "Tax Collector" for HMRC, this is the best option available at this time.

Thanks !