Expanding in Europe and entering new markets is what most online sellers using FBA want to achieve. If your are based outside the UK and sell a lot of your products to it, you might need a UK VAT number. This is the case if your sales to the UK reach the annual threshold limit.
Maximilian GamplLast Updated on
VAT Threshold Limit in the United Kingdom
Storing inventory in one of Amazon’s fulfilment centers? You will need a VAT number in this country. Setting up a business in a country? You will need a VAT number as well. Reaching the annual threshold limit of a country? You got it, a VAT number is required.
For sellers based outside the UK, they will need to register for VAT when they reach the annual VAT threshold limit in the UK ( £70 000).
But what does the actually mean?
Let’s try it with an example. If a seller from Germany who is only VAT registered in Germany is selling goods to various countries in Europe. As he is selling via mail order, e.g. as an Amazon FBA seller, this process is called distance selling. Distance selling within Europe means that the sellers need to get a VAT number in the country of import as soon as the annual threshold limit is reached.
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Continuing the example, let’s say that people from Italy love the product, the seller already reached the threshold limit of Italy and had registered for VAT there. Now he wants to try selling on the British market and it’s an immediate success. People from the UK order the article and the turnover within one calendar year (exclusively to clients in the UK) is 120 000€.
With the annual threshold limit of the UK being only about 81 000€ ( £70 000), the sellers needs to be registered for VAT in the UK.
Threshold Limit in the UK in GBP, EUR & USD
|VAT Threshold Limit UK||£70 000||~81 000€||~ $90 000|