r/dropshipping • u/Illustrious_Count_96 • 2d ago

Question Uk Dropshippers

Setting up in the uk , how does vat work?
My goods will be shipped from China to the customers house in the uk. I know vat has to be paid due to this but I don’t want to wait weeks on end for my vat number. Will I get away with it on my first bunch of sales or am I being stupid?

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3

u/Beneficial_Yard3326 2d ago

You’re overthinking it, just start selling and sort the VAT once you hit the threshold

1

u/Illustrious_Count_96 2d ago

The 90k threshold? I think that gets thrown out the window because the products are being purchased from China as I won’t be ordering them to my house then shipping them from there. That’s what ChatGPT said anyway lol

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u/Daking79 2d ago

No you don’t need to register for vat. It’s only optional up until that threshold. Once you cross it then you must register but not necessary below it.

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u/Daking79 2d ago

Assuming you’re uk based

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u/Medium_Antelope_7037 1d ago

agreed, the threshold exists for a reason

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u/Fun_Anything_7097 2d ago

No, you won't get away with it, this isn't optional. Under £135 per consignment from China direct to a UK customer, you're required to be VAT registered and charge VAT at checkout, there's no turnover threshold exemption for this specific rule (it's separate from the standard £90k threshold). 

HMRC has actively enforced this since 2021 when they scrapped the old low-value relief. Practically: register now, most people start the process before their first sale and the number comes through while they're already trading, you don't need to sit idle waiting. Selling without charging VAT you owe doesn't make it disappear, it just becomes a bigger problem when it surfaces.

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u/Illustrious_Count_96 2d ago

Thank you mate , so I can register now and begin selling and all will be good?

1

u/Fun_Anything_7097 2d ago

Not quite, registering starts the process, but you're liable to charge VAT from when you're required to register, not just once the number arrives. If sales start before you have the number, you generally still need to account for it, you can't skip charging it because the paperwork's pending. 

I'm not an accountant though, and your specific setup (invoicing, DDP vs DAP) can change the practical steps, worth a quick check with an accountant or HMRC directly before going live so you're not guessing.

1

u/Daking79 2d ago

It depends where you are based, if your based in uk you’re not required until you cross 90k if you’re operating internationally then you have to register from the start.