UK VAT Registration for Foreign Companies 2026

Updated October 2026

Foreign companies must register for UK VAT before making their first taxable supply in the UK. There is no £90,000 threshold for non-UK businesses. HMRC classifies overseas sellers as Non-Established Taxable Persons (NETPs) under Schedule 1A of the VAT Act 1994, which means registration is mandatory from day one, not after hitting a revenue milestone.

TL;DR

• Foreign companies have a zero VAT registration threshold in the UK. One taxable supply triggers the obligation.

• Registration typically takes 20 to 40 working days through HMRC. Delays of 8 weeks or more are common for overseas applicants.

• You need a UK VAT number (GB + 9 digits), a UK EORI number for imports, and Making Tax Digital (MTD) compatible software for quarterly returns.

• A Merchant of Record (MoR) like CRSSBRDR bypasses the entire process: you sell through our licensed UK entity and go live in 7 to 10 business days.

• Penalties for late registration include backdated VAT liability plus interest at 7.75% (HMRC rate as of October 2026).

CRSSBRDR™ is the only MoR built by a licensed accountant and a founding TikTok Shop Partner agency. We get US and EU brands live on TikTok Shop UK in 7 to 10 business days. £100M+ in ecommerce sales driven. Compliance built in, growth switched on.

Why is there no VAT threshold for foreign companies?

UK-established businesses benefit from a £90,000 annual threshold before mandatory VAT registration kicks in. Foreign companies get none of that protection.

Under Schedule 1A of the VAT Act 1994, any business without a UK establishment that makes or intends to make taxable supplies in the UK must notify HMRC within 30 days. This applies regardless of turnover.

HMRC's logic is straightforward: UK businesses already contribute to the tax base through corporation tax, PAYE and other obligations. Foreign businesses selling into the UK without VAT registration create an uneven playing field. The zero threshold closes that gap.

This catches every overseas ecommerce seller. If you hold inventory in a UK warehouse, sell goods directly to UK consumers, or supply digital services to UK buyers, you are making taxable supplies. Registration is not optional.

What triggers UK VAT registration for a foreign company?

Four scenarios trigger immediate registration:

1. Holding stock in the UK. The moment goods enter a UK fulfilment centre, third-party logistics warehouse, or Fulfilled by TikTok (FBT) facility, you have a taxable presence. This applies even before you make a single sale.

2. Selling goods directly to UK consumers. If you ship products from overseas to UK buyers and the consignment value exceeds £135, you are responsible for collecting and remitting UK VAT at 20%. For consignments at or below £135, online marketplaces are required to collect VAT on your behalf, though direct website sales remain your obligation.

3. Supplying digital services to UK consumers. SaaS subscriptions, downloadable content, online courses and apps sold to UK private consumers (B2C) trigger registration from the first transaction.

4. Making B2B supplies in the UK. If your business supplies goods or services to UK businesses where the place of supply is the UK, registration applies from the first supply.

For US brands looking to sell on TikTok Shop UK, trigger number one is the most common. TikTok Shop UK requires UK-warehoused inventory, which means VAT registration is a prerequisite, not an afterthought.

What documents do foreign companies need for UK VAT registration?

HMRC requires more documentation from overseas applicants than from UK businesses. Prepare the following before applying:

Mandatory documents:

• Certificate of incorporation or trade register extract from your home country

• Proof of trading activity (invoices, contracts, purchase orders showing UK sales intent)

• Identity verification for directors (passport or national ID)

• UK bank account details (or evidence you are in the process of opening one)

• Details of your UK fiscal representative or tax agent, if appointing one

• VAT1 form (online via the Government Gateway, or paper form for non-UK applicants who cannot use the online service)

Additional documents HMRC may request:

• Apostilled or notarised translations of non-English documents

• Evidence of UK warehousing arrangements (3PL contracts, FBT confirmation)

• Details of UK customers or sales channels

• Home country VAT registration certificate (if applicable)

HMRC processes applications through the Government Gateway at gov.uk/register-for-vat. Foreign companies that cannot register online must submit a paper VAT1 form by post.

How long does UK VAT registration take for foreign companies?

HMRC's stated target is 30 working days for standard applications. The reality for foreign companies is often worse.

HMRC asks applicants not to chase before 40 working days have passed. For foreign companies, the combination of document translation requirements, additional verification checks and postal delays pushes timelines further.

During this waiting period, you cannot legally trade VAT-free. If you make taxable supplies before receiving your VAT number, HMRC can backdate your registration to the date you first triggered the obligation and assess VAT on every sale made in the interim.

For brands targeting TikTok Shop UK, this timeline creates a real problem. TikTok requires a valid UK VAT number before activating your seller account. A 6 to 12 week HMRC wait means 6 to 12 weeks of lost sales.

Do foreign companies need a UK tax representative?

Foreign companies are not legally required to appoint a UK tax representative, but HMRC strongly encourages it for NETP registrations. A tax representative is jointly and severally liable for your VAT debts, which gives HMRC additional security.

If you choose to appoint one, use form VAT1TR alongside your VAT registration application. The representative must be UK-established and willing to accept joint liability.

Many foreign companies appoint a UK tax agent instead. Unlike a representative, an agent handles your VAT compliance (filing returns, managing correspondence with HMRC) without assuming joint liability. This is the more common route for ecommerce sellers.

CRSSBRDR takes this further. As your Merchant of Record, we act as the UK-established seller. Our entity holds the VAT registration, handles HMRC filings, and manages all compliance obligations. You do not need your own VAT number, tax representative or agent.

What is a UK VAT number and how is it structured?

A UK VAT number follows the format GB + 9 digits (for example, GB123456789). Northern Ireland traders registered under the Northern Ireland Protocol use the prefix XI instead of GB.

Your VAT number is not the same as your company number or your EORI number. You need all three to trade compliantly in the UK:

For a detailed breakdown of UK EORI requirements, see our Importer of Record guide.

What are the ongoing VAT obligations after registration?

Registration is just the start. Foreign companies registered for UK VAT must:

File quarterly VAT returns. Standard VAT accounting periods run quarterly. Returns must be filed and payment made within one month and seven days of the end of each quarter. All returns must be submitted digitally through Making Tax Digital (MTD) compatible software.

Charge VAT at 20%. The standard UK VAT rate is 20%. Reduced rates of 5% and 0% apply to specific goods and services. You must determine the correct rate for every SKU you sell.

Keep VAT records for 6 years. HMRC requires all VAT invoices, credit notes, import documentation and bank statements to be retained for a minimum of 6 years.

Reclaim input VAT. Registered businesses can reclaim VAT paid on UK business expenses, including warehousing costs, professional fees and goods purchased for resale. This is one advantage of registration: without it, you absorb VAT as a cost.

Use Postponed VAT Accounting (PVA). Since January 2021, businesses importing goods into the UK can use PVA to account for import VAT on their VAT return rather than paying it at the border. This significantly improves cash flow for cross-border sellers.

What happens if a foreign company does not register for UK VAT?

HMRC can and does pursue non-compliant overseas sellers. The consequences include:

Backdated VAT assessment. HMRC will register you retrospectively from the date you first made a taxable supply and assess VAT on all sales made since then. At 20%, this can be a significant liability.

Late registration penalty. Penalties are calculated as a percentage of the net VAT due from the date you should have registered to the date you actually registered. The penalty ranges from 5% to 15% depending on the length of delay.

Interest charges. Late payment interest is currently 7.75% (Bank of England base rate plus 2.5%). This accrues from the date VAT was due until payment.

Marketplace suspension. TikTok Shop, Amazon and other UK marketplaces increasingly verify VAT registration as part of seller onboarding. Operating without a valid registration can result in account suspension and held payouts.

For EU brands selling in the UK post-Brexit, the compliance landscape has specific additional requirements beyond VAT registration alone.

How does a Merchant of Record eliminate the VAT registration burden?

A Merchant of Record is a UK-established entity that legally sells goods on your behalf. The MoR holds the UK VAT registration, EORI number, and Importer of Record status. Your brand retains control of products, pricing and marketing while the MoR handles compliance.

Here is how the two routes compare:

For brands that want to understand how a Merchant of Record works in more detail, or compare the MoR route against setting up your own entity, we have dedicated guides.

The MoR route is not right for every business. If you plan to build a permanent UK operation with local staff and a UK subsidiary, registering for VAT directly makes sense long-term. But if your goal is to test the UK market quickly, particularly through TikTok Shop, the MoR route removes 6 to 12 weeks of friction.

FAQ

Do US companies need to register for UK VAT? Yes, if they make taxable supplies in the UK. There is no threshold exemption for foreign companies. Registration is required from the first taxable supply.

Can I register for UK VAT without a UK address? Yes. HMRC accepts overseas addresses for NETP registrations. You do not need a UK office or registered address, though appointing a UK tax agent simplifies correspondence.

How much does UK VAT registration cost? HMRC does not charge a registration fee. The costs come from professional fees (£500 to £2,000 for an accountant to handle the application) and ongoing compliance (MTD software, quarterly return preparation).

Do I need a UK bank account for VAT registration? HMRC prefers a UK bank account for VAT refunds but does not strictly require one for registration. Some foreign currency accounts are accepted. HMRC will confirm requirements during the application process.

What is Postponed VAT Accounting? PVA allows UK VAT-registered importers to account for import VAT on their quarterly return rather than paying cash at the border. This eliminates the cash flow hit of paying VAT on every shipment and reclaiming it weeks later.

Can a foreign company reclaim UK VAT without registering? Non-registered overseas businesses can reclaim UK VAT through the HMRC Overseas Repayment Scheme (Directive 13 claims). However, this only applies to VAT incurred on UK expenses, not on goods sold in the UK.

Is UK VAT registration the same as UK company formation? No. VAT registration is a tax obligation managed by HMRC. Company formation is a legal incorporation managed by Companies House. You can register for UK VAT without forming a UK company. You cannot, however, sell on TikTok Shop UK without a UK-established entity or an MoR.

How does CRSSBRDR handle VAT for foreign brands? CRSSBRDR acts as the UK-established Merchant of Record. Our entity is VAT-registered, holds a UK EORI, and operates as a licensed Importer of Record. Brands sell through our infrastructure and go live in 7 to 10 business days with zero HMRC paperwork.

CRSSBRDR™ gets US and EU brands live on TikTok Shop UK in days, not months. Get started or book a 15-minute call to map your UK launch.