Is dropshipping legal in the UK? Yes, dropshipping is just a business model, so it’s totally legal. As an emerging business model, dropshipping makes dropshippers sell without necessarily having stock or producing any goods. If you want to start a dropshipping business in the UK, you have to register it? The short answer is yes. Dropshipping in the UK carries taxes on the value of the goods sold, and that's where VAT applies. We have talked about What Does VAT Mean to Dropshippers before, now we will provides valuable tips on how to get vat registered UK.
How to Register for VAT UK for Dropshipping Business?
The VAT registration process varies according to region. For most countries in the EU, there is a VAT threshold in place. However, from July, all EU nations will have a single VAT threshold pegged at €10. Once triggered, it is required that you register for VAT in the country of import. But for the UK, this case varies as it has left the European Union. If you are a dropshipper in the UK, you must register your business to avoid any form of legal repercussion for your dropshipping business. Here are a few steps to follow when writing your dropshipping business in the UK.
1. Identify the Nature of Your Business
To register your dropshipping business for VAT in the UK, you must first identify which category it falls under the three predominant business structure in the UK, namely:
- Sole Trader
- Partnership
- Limited Company.
Most Businesses will fall under Sole Trader. However, be sure you have examined every alternative at your disposal and assessed which one suits your business best.
2. Are you UK Based?
If yes, you must register your dropshipping business for VAT under the following circumstances.
- That your VAT taxable turnover is more than £85,000 in the next 30 Days.
- That your business has a VAT taxable turnover of more than £85 000 in the past 12 months.
- However, if you find that your taxable threshold exceeds the £85,000 benchmark for the period mentioned above, you can apply for an exemption.
3. If You Are Overseas
If you run your business from the outside UK, it means that you are a seller from countries other than the UK. In this instance, there is no set threshold for you. However, it is pertinent that you register when you supply any goods to clients within the UK. You are expected to write within a 30 days space of delivering goods.
4. Identify the Ways of Registering
There are two verified ways of Registering your dropshipping Business for VAT in the UK. You can either Register online or through an agent.
- How to Register Online: There various ways to register your dropshipping business for VAT in the UK. But the fastest means is to get vat registered. There are a lot of websites dedicated to this. However, saleyee.com serves as the quickest and most reliable platform to consult when writing your business in the UK.
- How to Use an Agent: The alternative to Registering for your VAT UK online is to feel an accountant or agent( as the case may be) to Register dor VAT. The agent submits your VAT returns and sorts out the proceedings regarding the HMRC on your behalf. If you are outside the UK, this is often the most reliable means at your disposal. Once the agent provides your HMRC assigned VAT number, you can easily log online to apply for your VAT account.
Other helpful tips on VAT Registration in the UK are as follows:
- Always Provide accurate details like your turnover and bank details, when required.
- Be careful to note your registration date, as it will be used as your effective day of registration to make payments.
- If you are a registered vat payer, your VAT registration certificate will be ready within 30 working days of registration. Furthermore, the certificate will be sent to you either through your VAT account or by post.
saleyee.com Helps Dropshippers with VAT Registration and Automated Invoicing
SaleYee dropshipping platform also helps dropshippers who seek to register their VAT online and get an automated invoicing function for dropshipping business. With easy sign up or sign in, here are the applicable guidelines on how to register for VAT UK:
For Business:
1. Click on "My SaleYee" Afterwards, you will see an option for "Account", which takes you to "VAT ID number management".
2. Click on the "Business", and follow through to "Add VAT information", where you will fill in relevant information required. (For Non-VAT-registered business, VAT ID number is not required.)
3. Click on the commitment information letter, which reads" I have agreed", and clicks "save" while you await confirmation.
For Personal:
1. Click on "My SaleYee", log on to the "Account" and click on "VAT ID number management";
2. Click "Personal" where you are required to fill in the relevant information needed;
3. Tick "I have read and agreed" commitment part and finally click "Save" to send your information for approval.
To view your VAT Registration Status:
To view your VAT registration status, you can click on the "View", where you will be led to a portal to check your VAT registration information as well as your Verification Status. Furthermore, if your VAT status fails the approval stage, you can view and modify the page for re-approval.Invoice Download & Management:
One of the ways SaleYee helps dropshipping businesses is by providing automated invoicing. No matter an invoice of a single order or invoices of multiple orders, it can be accessible. Invoice records for historical orders can be viewed and downloaded in the invoice management module.
Keep Your Chin up
For many dropshippers with small businesses, the new 2021 VAT changes will mean you’ll have to change some elements of the way your dropshipping business runs. No worries. saleyee.com is always providing you with responsive support and you can spend more time boosting your store sales.
