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As an online marketplace operator, you are liable for VAT on goods of any value that are both:

• located in the UK at the point of sale
• sold by an overseas business through your online marketplace

You need to understand who is liable for VAT on sales of goods you facilitate. To confirm this, you should take all reasonable steps to check whether a seller is established outside the UK.

Decide what checks are reasonable and appropriate

HMRC cannot tell you exactly what checks to make to confirm where the seller is established.

You should decide what checks to make in each case. For example, they can be based on, but are not limited to:

• the鈥痵ize of your business
• internal risking systems
• the individual circumstances of each case

Keep evidence to show that you鈥檝e taken all reasonable steps

You should keep records of all relevant evidence. This is to show that you鈥檝e taken all reasonable steps to determine the seller鈥檚 place of establishment for VAT purposes. HMRC cannot tell you what evidence to keep.

HMRC may ask you to provide evidence of the action you鈥檝e taken to find out the seller鈥檚 place of establishment.

How HMRC will review your evidence

HMRC will consider all evidence you鈥檝e used to work out where the seller is established. In each case, we鈥檒l need to consider:

• what steps you performed, including any that are designed to address the risks of a particular case聽

• to what extent steps were appropriate, adequate and timely in relation to addressing the risks identified聽

• what the results of your checks indicate

• whether you took appropriate action in response to the results

Examples of checks you might make

These examples show the types of checks you might make to determine if an online seller is UK-established. These are guidelines, not聽a set list of checks that you must carry out.

This not a list of all checks it鈥檚 possible to make but it might help you obtain evidence.

A). Check for a UK principal place of business.

B). Check that the VAT registration available for the seller matches their legal name and details on HMRC鈥檚 Check a UK VAT number tool.

C). Check that the seller is registered at Companies House with a UK address, if appropriate.

D). Find out whether whether directors reside in the UK, for example, as shown on the Companies House register.

E). Check that payment or financial information shows a UK presence. This can include:

• UK bank or credit card details
• UK merchant address attached to the seller bank account
• other financial data provided by independent payment service providers
  
  

F). Check other commercially relevant information such as credit checks and other background checks from third party sources.

G). Check that the device used by the seller has a UK IP address, or check another method of geolocation.

H). Confirm that the seller uses a phone number with a UK country code.

If you find indicators that throw doubt on whether the seller is UK established, you should undertake further checks.