At or under 135 pounds for the consignment, the sale is treated as taking place in the UK for VAT purposes when an overseas seller sells to a consumer, so the seller charges VAT at checkout and pays it over on a UK return. Over that line, the goods are imported and VAT is accounted for at the border or through postponed accounting for registered businesses. The same store can live in both systems in the same week, on different baskets.
Consignment value is the goods value, and baskets engineered to sit under the line by splitting one order into several parcels invite exactly the scrutiny you would expect. Split because the warehouse must, not because the threshold tempts you. Confirm the current rules with a UK adviser before building them into a checkout, because thresholds and marketplace rules have moved before.
Where an online marketplace facilitates the sale, the marketplace is generally the party that accounts for the VAT on those low value consignments, not the underlying seller. That distinction decides who registers and who remits, and stores selling both through a marketplace and on their own site can owe VAT on one channel and not the other for identical goods.
Keep the channel records separate from the start. Commingled sales data that cannot say which orders the marketplace accounted for is how a seller ends up assessed for VAT the platform already paid, or, worse, the reverse.
An overseas seller registering for UK VAT gets a VAT number that also does a quiet second job: it goes on the parcel paperwork so the goods are not charged VAT again at the border. When that number is missing or wrong on the declaration, the buyer can be asked to pay import VAT on a purchase where VAT was already collected at checkout, and the support ticket that follows is fully justified.
At checkout, show the British buyer a price that includes VAT and say there is nothing further to pay on delivery for consignments in the checkout collection model. Ambiguity here is expensive in Britain in particular, because buyers have learned from experience that a delivery day demand sometimes follows an all inclusive looking price.
Most goods take the standard UK VAT rate, currently 20 percent, with reduced and zero rates for defined categories such as many children's clothes and most food. Mixed baskets need line level treatment, and a store rating every line at the headline rate will overcharge on exactly the categories where British buyers know the right answer by heart.
Sales to VAT registered UK businesses follow different evidence rules, starting with collecting and validating the buyer's VAT number. Get the business status at checkout rather than inferring it from the basket, because the VAT treatment of the whole consignment can turn on it. Confirm current thresholds and rates with a licensed broker or UK tax adviser before a sourcing or market entry decision.
Keep reading: How does Switzerland tax low value imports from online stores?, How do US brands handle Canada GST and HST without a local entity?.
For VAT on goods sold to consumers, the operative line is 135 pounds per consignment, at or under which the overseas seller generally collects VAT at checkout. It is a collection threshold, not an exemption: VAT is due from the first sale under that model.
Generally the marketplace, where it facilitates the sale of low value consignments to UK consumers. Sales on your own site are yours to account for. Keep channel records separate so each order's treatment is provable.
Usually because the seller's VAT number or the correct import information was missing from the parcel declaration, so the border treated it as an ordinary import. The checkout collected VAT and the delivery charged it again. Correct declaration data prevents the double charge.
Many children's clothes are zero rated in the UK, while most other goods take the standard rate, currently 20 percent. Category rules have detail and exceptions, so line level rating with current UK guidance matters for mixed baskets.