Etsy and eBay: Selling to the UK — Who Pays VAT, How the £135 Threshold Works, and Customs Duty

The Marketplace VAT Mechanism — How Etsy and eBay Took on the VAT Obligation

Since 1 January 2021, the UK VAT Act 1994 was amended so that 'marketplace operators' (including Etsy, eBay, Amazon, Not on the High Street) became responsible for collecting and paying VAT on sales made by a foreign company or individual where the consignment value does not exceed £135. This approach is referred to in official HMRC documents as 'marketplace-facilitated VAT' and is described in detail in GOV.UK guidance.

Sales Below £135 — What the Platform Does, What the Seller Does

<p>If the consignment value to the UK buyer does not exceed £135 (excluding shipping and insurance costs), the Etsy or eBay platform:</p><ul><li>collects UK VAT (20%) from the buyer at the point of purchase,</li><li>pays that VAT to HMRC,</li><li>acts as the 'UK VAT-registered taxpayer' for that transaction.</li></ul><p>You as the external seller (established in Poland or outside the UK): invoice the platform as the wholesale seller (B2B), without UK VAT. You do not file UK VAT returns for these transactions — provided you have no other UK VAT obligations. Source: <a href='https://www.gov.uk/guidance/check-when-online-marketplaces-are-responsible-for-vat'>GOV.UK — Check when online marketplaces are responsible for VAT</a>.</p><p>Note: you do not need to register for UK VAT solely because of Etsy/eBay sales below the £135 threshold — but if your total B2C sales in the UK exceed other thresholds (e.g. you have separate sales channels), different rules may apply. Consult a UK VAT tax adviser.</p>

Sales Above £135 — Who Is Responsible for VAT and Duty

<p>If the consignment value exceeds £135, Etsy and eBay are <strong>not</strong> responsible for UK VAT. The transaction is treated as an import of goods into the UK subject to standard customs rules:</p><ul><li>The UK buyer pays import VAT (20% as standard) and duty according to the HS code of the goods on delivery from the courier or postal service.</li><li>Duty is calculated on the customs value of the goods — essentially the invoice value plus freight costs to the UK border.</li><li>The delivery service provider (DHL, DPD, Polish Post, Royal Mail) typically collects these charges from the buyer as an 'administration fee' or advance customs clearance charge.</li></ul><p>Source: <a href='https://www.gov.uk/guidance/vat-and-overseas-goods-sold-to-customers-in-the-uk'>GOV.UK — VAT for overseas sellers</a>.</p><p>For sellers: this is not your tax problem, but it may be a sales problem. If the buyer does not expect additional charges on delivery — they may refuse to accept the parcel. It is worth stating clearly in your listing description: 'Item shipped from Poland; consignments above £135 may be subject to UK duty and VAT payable on delivery.'</p>

Consignment Value vs Item Value — How to Calculate the £135 Threshold

The £135 threshold applies to the value of the <strong>consignment</strong>, not the value of a single item. If you send the buyer several items in one parcel, the total value of all the goods in that parcel counts — excluding VAT and shipping costs. This distinction is crucial: you could be selling items worth £200 each but shipping one at a time — each shipment would be below the threshold. Alternatively, you could sell cheap items but send 10 in one parcel — and exceed the threshold. HMRC describes these rules in detail on its overseas e-commerce VAT guidance page.

How to Correctly Establish Consignment Value for UK VAT Purposes

<p>The consignment value for the purposes of the £135 threshold is the <strong>intrinsic value</strong> — the value of the goods excluding:</p><ul><li>VAT or similar taxes,</li><li>shipping and insurance costs (if separately itemised on the invoice),</li><li>other charges collected from the buyer by the platform.</li></ul><p>If shipping costs are included in the item price (price 'including shipping'), HMRC may include the entire amount as the goods value. For this reason, we recommend clearly separating shipping costs in the listing description and on the invoice. Source: <a href='https://www.gov.uk/guidance/vat-and-overseas-goods-sold-to-customers-in-the-uk'>GOV.UK — VAT for overseas sellers</a>.</p>

Splitting Shipments vs Artificial Division — What to Avoid

<p>HMRC explicitly prohibits artificially splitting a shipment in order to stay below the £135 threshold. If the buyer ordered several items at the same time and you deliberately split the shipment into multiple parcels to meet the threshold, the customs authority may aggregate those consignments into one for valuation purposes.</p><p>Multiple parcels sent to the same buyer at the same time will be treated as one shipment (split consignment) and the combined value may exceed the threshold. However, if the buyer places two separate orders on different days and you ship each separately — those are two independent consignments and each is assessed individually. Source: <a href='https://www.gov.uk/guidance/check-when-online-marketplaces-are-responsible-for-vat'>GOV.UK — Check when online marketplaces are responsible for VAT</a>.</p>

Practical Implications for Polish Sellers on Etsy and eBay

Understanding the £135 mechanism is one thing — but more important are the practical decisions: how to price products, how to inform buyers, what customs documents to include in the parcel, and when a UK EORI number is needed. Below we answer the most common questions from Polish sellers using Etsy and eBay for sales to the UK.

Do I Need a UK EORI as an Etsy or eBay Seller Shipping Below £135?

<p>If you ship exclusively consignments below £135 through Etsy or eBay, and the platform handles UK VAT — in principle you do not need a UK EORI number as the seller. The platform acts as the 'VAT importer' for tax purposes, although the courier physically carries out the import. A UK EORI is required if:</p><ul><li>you are lodging customs declarations in the UK in your own name,</li><li>you are shipping consignments above £135 and, as a Polish exporter, are lodging export declarations in the EU.</li></ul><p>For shipments below £135 from Poland: as a Polish exporter, you will need a PL/EU EORI number to lodge the export declaration in Poland (PUESC). Every shipment of goods leaving the EU — even by courier — technically requires a customs declaration on the EU side. In practice, couriers and postal services apply simplified procedures for small shipments — but if you want legal certainty, consult a customs agency.</p>

What to Include in a Parcel Sent to the UK via Etsy or eBay

<p>Every shipment from Poland to the UK should include:</p><ol><li><strong>Commercial invoice</strong> — with the goods value, description, HS code (even approximate), and seller and buyer details. No invoice = risk of the parcel being held by UK Border Force.</li><li><strong>CN22 or CN23</strong> — customs forms for postal shipments. Etsy and eBay generate these forms automatically when you purchase a shipping label through the platform.</li><li><strong>Goods description and HS code</strong> — the tariff classification. For Etsy: handmade products are often codes in the 97xx series (works of art) or 42xx (leather goods) — use the HMRC Trade Tariff search tool: <a href='https://www.trade-tariff.service.gov.uk/'>trade-tariff.service.gov.uk</a>.</li></ol><p>If the consignment value is close to £135 — clearly separate shipping costs on the invoice so that the goods value is below the threshold and the platform handles UK VAT.</p>

How This Article Differs from a General Etsy/eBay UK Sales Guide

<p>This article focuses exclusively on the £135 threshold mechanism and marketplace VAT responsibility — which is a different angle from a general guide to selling to the UK after Brexit. Other Easy Clearance resources cover general principles (customs clearance, EORI, goods classification). This article answers one specific question: 'who pays UK VAT on Etsy and eBay transactions?' — the answer depends entirely on the £135 threshold.</p><p>Links to related Easy Clearance resources: <a href='/en/articles/brexit-ecommerce-etsy-ebay-sprzedaz-do-uk.html'>Selling via Etsy/eBay to the UK after Brexit</a> (general guide) and <a href='/en/articles/dropshipping-do-uk-kto-jest-importerem-vat-clo.html'>Dropshipping to the UK — who is the importer</a>.</p>

What the current rules say

Selling via Etsy and eBay to the UK is subject to the marketplace VAT mechanism: below £135 consignment value the platform collects and pays UK VAT on behalf of the seller; above that amount the buyer pays VAT and duty independently on delivery. Polish sellers shipping below the threshold do not register for UK VAT for these transactions, but every parcel must have the correct customs documents and an HS code. This article reflects the legal position as of 2026-04-18. Contact a customs broker before taking any action.

FAQ — frequently asked questions

Who pays UK VAT on sales through Etsy or eBay?

Below £135 consignment value: the platform (Etsy or eBay) collects UK VAT from the buyer and pays it to HMRC. Above £135: the buyer pays import VAT and duty independently when collecting the parcel from the courier.

As an Etsy seller shipping to the UK, do I need to register for UK VAT?

If your sales are exclusively through Etsy and every consignment is below £135 — in principle you do not need to register for UK VAT for these transactions. The platform handles UK VAT on your behalf. If you have other sales channels to the UK — consult a tax adviser.

How is the £135 threshold calculated — per item or per whole parcel?

The £135 threshold is calculated on the total consignment value, not per individual item. If you send several products in one parcel, the combined value (excluding VAT and shipping costs) counts.

What happens to Etsy shipments above £135 in value?

Above £135: Etsy is not responsible for VAT. The courier or postal service delivering the parcel collects import VAT (20%) and duty according to the HS code of the goods from the buyer. The buyer must pay before collecting the parcel.

What customs documents should be included in a parcel sent via Etsy to the UK?

A commercial invoice with the goods value and description, an HS code, and a CN22 or CN23 form (generated by Etsy or eBay when purchasing a shipping label). Without an invoice the parcel may be held at the UK border.

Official sources

• Check when online marketplaces are responsible for VAT — GOV.UK
• VAT and overseas goods sold to customers in the UK — GOV.UK
• Changes to VAT treatment of overseas goods — 1 January 2021 — GOV.UK
• UK Trade Tariff — HS code search — HMRC