£135 e-commerce VAT threshold: sales to Great Britain

A checkout VAT charge and an import VAT charge belong to different processes. For ordinary commercial goods located outside the UK when sold and sent to Great Britain, the £135 threshold helps determine the accounting route. Customs-document assistance can support the shipment file; obtain VAT advice for the seller’s obligations.

Scope and what changed

This article covers Great Britain: England, Scotland and Wales. Northern Ireland, EU IOSS, UK-held stock, gifts and excise goods need their own assessment. The low-value import VAT relief was removed in 2021; a low-priced purchase is not automatically VAT-free. HMRC direct-sales guidance.

Work out the whole consignment value

Use intrinsic value: the sale price excluding identifiable taxes and charges and separately stated transport or insurance. Include those costs if built into an undivided price. Add all items sent together. Exactly £135 belongs to the “£135 or less” group; splitting the invoice into lines does not split the consignment.

Fictional example: goods priced at £130 plus separately stated £10 shipping have £130 intrinsic value. An undivided £140 price including delivery is assessed as £140 for this test. This example decides no VAT rate or customs outcome.

Direct consumer sales: £135 or less

For covered direct sales, the seller charges and accounts for VAT at sale and addresses UK registration, records and the applicable goods rate. Selling through your own online shop is a direct-sales model rather than a marketplace sale. Review exemptions and the actual supply facts with a VAT adviser. HMRC explains direct-sales obligations.

Marketplace sales: £135 or less

Where the platform meets HMRC’s online-marketplace definition and the transaction is covered, the marketplace accounts for VAT. A payment processor or advertising site alone is not enough. Retain the order’s marketplace VAT information and dispatch data. HMRC marketplace guidance.

Business customers and consignments above £135

For covered low-value GB supplies, a customer providing a valid UK VAT number can account for VAT by reverse charge. “B2B” wording alone is insufficient. Above £135, normal import VAT and customs rules apply; identify the actual importer and payment arrangement. Reverse charge and postponed import VAT accounting are different mechanisms, not interchangeable choices for every business shipment.

Prepare shipment information for the courier

• Order reference, goods description and quantities.
• Total intrinsic value with separately stated transport and insurance.
• Actual seller, customer and importer roles.
• Direct-shop or qualifying marketplace channel.
• Relevant VAT information and validated business customer status.
• Invoice and declaration instructions agreed with the appointed representative.

Normal VAT-invoice rules apply. A phrase such as “VAT paid in UK” is not a universal clearance instruction. This guide provides no H7 or CDS procedure-code recipe. Ask the representative which declaration data the actual route requires; neither a checkout receipt nor a courier booking guarantees release or an absence of other charges.

Own-shop workflow

• Describe where the goods are at sale and where they will be delivered.
• Have registration and VAT treatment assessed before launching the covered sales model.
• Configure the applicable rate and customer-status checks.
• Keep the order, invoice and VAT records aligned with shipment information.
• Review returned goods, changed orders and consignment values separately.

Common mistakes and assistance

Avoid treating the threshold as per-item value, excluding exactly £135, assuming all goods use one rate, or treating every marketplace seller as exempt from registration. Ask Easy Clearance what customs-document support is available and which VAT specialist is needed. No checkout configuration, VAT registration or refund outcome is promised.

Official sources

• HMRC direct-sales VAT
• HMRC marketplace VAT

Reviewed 4 October 2026. Check the order, invoice and shipment values together before dispatch.

FAQ

Does £135 include shipping?

Separately stated transport and insurance are excluded from intrinsic value. If included in the price and not separately shown, they count. Add all items in the consignment.

Does the threshold apply to B2B?

Yes. For qualifying consignments of £135 or less, a customer providing a valid UK VAT number can account for GB VAT by reverse charge. Above £135 normal import rules apply.

Does marketplace selling remove every VAT-registration obligation?

No. Review other sales, UK-held stock and the actual supply model. Marketplace VAT collection does not establish a universal registration exemption.

Does every product use the standard VAT rate?

No. Determine the applicable rate for the actual goods. Excise consignments and non-commercial gifts are outside these low-value sales rules.

What if the customer receives a second VAT demand?

Compare the order, VAT treatment and declaration with the courier or customs representative and VAT adviser. Do not assume a refund or that one missing phrase determines the outcome.

Related cross-border preparation

Keep customs identification, sales VAT and road-transport compliance as separate checks: EORI roles and validation, GB road-haulage weight and dimension checks.