Research and analysis

Prevalence of individuals shopping online from overseas and handling of VAT

This research explored the attitudes and experiences of individuals shopping online, including misrepresentation or undervaluation, and consumer awareness of VAT and customs requirements.


Prevalence of individuals shopping online from overseas and handling of VAT

This file may not be suitable for users of assistive technology. Request an accessible format.

If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email Please tell us what format you need. It will help us if you say what assistive technology you use.


Consumers are increasingly shopping online rather than in traditional shops, making it easy for non-EU sellers to access UK markets. HMRC estimates that the amount of VAT revenue forgone on non-EU online internet sales was £1-1.5 billion in 2015-16.

The aim of this research was to help understand the extent and nature of this problem, and to contribute to the effective implementation of proposals aimed at reducing the revenue that goes undeclared. Specifically, the study explored:

  • the prevalence of online shopping
  • consumers’ perspectives on the issue of misrepresentation and undervaluation of goods
  • potential avenues for encouraging consumers to identify and avoid shopping with non-compliant businesses

Research was conducted in two stages:

  1. 960 quantitative face to face interviews about the prevalence of online shopping and consumer behaviours
  2. 46 qualitative interviews - 40 through an online discussion group and six face to face interviews

Research was conducted in August 2016 and December 2016 to February 2017.

Published 12 September 2017