Step-by-Step Guide for E-Commerce Companies
Expanding your online store into the UK means getting three things right at the same time: VAT registration, customs clearance, and a shipping solution that fits your volume. MS Direct is an experienced cross-border partner that handles the entire shipping process—including rate calculation and customs clearance—from the EU warehouse to the end customer in the UK, as well as local returns processing and return shipping to the EU.
The United Kingdom is Europe’s largest and most mature e-commerce market. Companies that launch here can reach a broad customer base that is eager to make purchases, with online sales accounting for a significant share of total retail sales.
Online shopping is a regular part of everyday life in the UK. A large proportion of adults shop online regularly, across all age groups. Anyone who starts out with a solid setup will encounter well-established shopping habits.
British customers regularly shop at foreign online stores, particularly for fashion and lifestyle products. There is demand for international product offerings, and entering this market aligns with existing purchasing behavior.
British customers have clear expectations regarding delivery, price, and returns. Those who meet these expectations can compete with local providers.
A large portion of the UK’s online retail business takes place on marketplaces. For many people, they are the first place to look when searching for products. Well-known marketplaces in the UK include:
For last-mile delivery, British retailers rely on established delivery partners. The best choice depends on coverage, cost, and level of service. Commonly used carriers in the UK include:
British customers expect familiar payment options. Cards are widely used, and digital wallets are becoming increasingly popular. Popular payment methods in the UK include:
We’ll support you every step of the way on your cross-border journey
Your benefits:
As a seller not based in the UK, you are subject to VAT regardless of your sales threshold. You must register with HMRC as soon as you make your first taxable delivery. The well-known threshold of 90,000 GBP applies only to UK-based businesses, not to foreign mail-order companies.
The value of a shipment determines where VAT is due. For shipments valued at up to 135 GBP sold directly to British consumers, you collect 20% VAT at checkout and remit it to HMRC. This ensures there are no additional charges upon delivery. For shipments valued at over 135 GBP, import VAT and—depending on the goods’ origin and HS code—import duties apply.
The standard rate is 20%. A reduced rate of 5% applies to certain goods, such as specific energy products. A zero rate applies, among other things, to most food items, books, newspapers, and children’s clothing and shoes.
If you sell through an online marketplace, the marketplace is liable for VAT on shipments up to 135 GBP. For B2B sales to a UK company with a valid VAT number, the reverse-charge procedure applies, and the business customer handles the VAT payment themselves.
Every shipment from the EU to the UK must be declared to customs and requires an EORI number (EU or UK). Without it, goods cannot be declared to customs.
Every import into the United Kingdom must be declared to customs. For each shipment, you’ll need a commercial invoice that includes the value of the goods, the commodity code (HS code), the country of origin, the weight, and the correct sender and recipient information. For imports from the EU, Entry Summary Declarations are also required.
The EU-UK Trade and Cooperation Agreement provides for zero tariffs if the goods meet the rules of origin, meaning they originate in the EU or the UK. To do this, you must claim the preferential treatment on the customs declaration and provide proof of origin, such as a declaration of origin from the exporter. Goods that do not meet the rules of origin are subject to the UK Global Tariff.
Shipments up to 135 GBP are duty-free but are subject to VAT at checkout. A waiver applies to the proof of origin for shipments with a total value under 1,000 GBP. The duty exemption for low-value shipments is currently under political review but remains in effect without change.
MS Direct handles your expansion into the UK throughout the entire cross-border process. Our solution has a modular structure and offers the following features:
From individual cross-border services to a complete end-to-end solution: We combine the right services for your business model.
MS Direct automates key cross-border processes and provides real-time visibility into them through a central portal.
MS Direct operates its own returns facility and delivers locally. This combines our customs expertise with short delivery routes for your customers.
Learn more about our cross-border services
„Would you like to enter Europe’s largest e-commerce market? I’d be happy to advise you personally on how to successfully ship to the UK. “
Andy Mann
Senior Business Development Manager
Andy.Mann@ms-direct.com
