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HMRC internal manual

VAT Registration

Registration in respect of distance selling from other Member States: the distance-selling threshold

Distance sales made by an individual are usually taxed in the Member State of origin until the total value of supplies to the Member State of destination exceeds the latter’s distance selling threshold. Each Member State can set its own threshold within parameters laid down in European legislation. The UK threshold for distance sales is laid down in the VAT Act 1994, Schedule 2, paragraph 1.

When a business established in another Member State exceeds the distance selling threshold in the UK, it becomes liable to be registered here. Once registration is effected, all distance sales to the UK are taxed here.

The threshold limit is based on sales made during a calendar year from 1 January to 31 December. A liability to register for UK VAT arises from the day that sales exceed the threshold.