Selling Online in the UK: VAT, HMRC and Payments

Setting up an online shop in the UK is straightforward, but it brings duties a simple website does not. Before your first sale, get familiar with the VAT and HMRC side and choose hosting that can handle transactions. This is a practical overview, not tax advice, so confirm details with an accountant or HMRC.

Do you need to register for VAT?

VAT registration becomes mandatory once your taxable turnover passes the threshold, currently £90,000, though you should check the live figure on the HMRC site since it changes. You can register voluntarily below the threshold if it suits you, for example to reclaim VAT on costs.

Making Tax Digital rules mean VAT records and returns are generally kept and filed through compatible software, so factor that into your setup.

Getting paid

You will need to take card payments. Providers like Stripe and others integrate with most platforms and handle the secure card handling, keeping you out of the hardest parts of payment compliance. Compare fees, payout timing, and support for Apple Pay and Google Pay.

Show prices in pounds and display VAT clearly to avoid confusion and abandoned carts.

The hosting a shop needs

A shop runs a database, processes payments, and must stay up during peak selling. Look for strong performance, daily backups, SSL as standard, and headroom for traffic spikes around sales and seasonal peaks. A slow checkout loses orders, so speed for UK visitors matters.

Pre-launch checklist

• Confirm your VAT position with an accountant or HMRC.
• Set up a payment provider and test a live transaction end to end.
• Show pound pricing and VAT clearly throughout checkout.
• Publish clear delivery, returns and privacy policies.
• Enable SSL everywhere and switch on daily backups.
• Load-test before a busy launch day.