The UK £135 rule: who charges VAT on your orders
For consignments valued at or below £135 sold to UK consumers, there is no import VAT at the border — instead you (or the marketplace, if you sell through one) must charge 20% UK VAT at the point of sale and remit it to HMRC. Above £135, normal import VAT and duty apply at the border.
Direct sellers vs marketplace sellers
Sell through a marketplace and the marketplace is the deemed supplier: it charges and remits the VAT on qualifying consignments, and you largely stay out of HMRC's registration net for those sales.
Sell through your own store and the obligation is yours: register with HMRC, charge VAT at checkout on ≤£135 consignments, file returns. That administrative cost is real — some small DTC sellers deliberately route UK sales through a marketplace instead.
Watch the consignment value, not the item price
The £135 line applies to the consignment's intrinsic value (excluding shipping and insurance). Bundling several items into one parcel can push a consignment over the line and flip the whole tax treatment — split or price consciously around it.
Common questions
- Do I add VAT on top of my price or absorb it?
- Your choice commercially, but UK consumer prices are conventionally VAT-inclusive; quoting VAT-exclusive prices to UK consumers hurts conversion and can breach advertising rules.
Official sources behind these numbers
- For consignments of goods with a value of GBP 135 or less sold directly to UK customers, the overseas seller must charge and account for UK (supply) VAT at the point of sale and register for VAT with HMRC; import VAT is not collected at the border for these consignments. HM Revenue & Customs (GOV.UK) · verified 2026-07-21 · effective 2021-01-01
- UK standard VAT rate is 20% (reduced rate 5%, zero rate 0%). HM Revenue & Customs (GOV.UK) · verified 2026-07-21 · effective 2011-01-04
- When overseas goods in consignments of GBP 135 or less are sold to UK customers through an online marketplace, the marketplace (not the seller) is liable for the VAT. The marketplace is also liable for VAT on sales of goods already in the UK when sold via the marketplace by an overseas (non-UK established) seller, at any value. HM Revenue & Customs (GOV.UK) · verified 2026-07-21 · effective 2021-01-01