VAT on goods more than 135GBP

Company A is a non-UK business that sells goods through an online marketplace. The online marketplace is set up to charge VAT to buyers for sales less than 135GBP but remits it to Company A so Company A has to pay it to HMRC when filing VAT returns. How is Company A going to treat sales for more than 135GBP if the online marketplace did not charge the buyers VAT for it? Does Company A need to pay HMRC the VAT for those? And what will be the treatment if the goods will be delivered from a) a warehouse that is already in UK? b) a warehouse that is outside of UK (in EU)?

If company A is storing goods in the UK they are obligated to register for VAT . Imported goods will be subject to import VAT and customs duties if applicable. When goods are sold to customers then VAT should be charged and accounted for on their VAT return. If goods sold to customers from overseas warehouses are over £135 then the VAT simplification for low value goods below £135 no longer applies. Standard import procedures apply with import vat and customs duties being applicable. These taxes must be settled before goods are released. This may be that the recipients pays those taxes directly or the sender agrees to settle. If sales are made via an online marketplace that marketplace may specify how sellers deal with taxes and duties applicable on import. All details are published by HMRC https://www.gov.uk/guidance/vat-and-overseas-goods-sold-to-customers-in-the-uk-using-online-marketplaces

Hi kjmr,

If the overseas company sell goods below a value of £135 and they use a marketplace then it is the responsibility of the marketplce to charge and account for the VAT over to HMRC.
If the goods are over £135 and the goods are sent directly from overseas then it would depend who the importer of the goods is.
If the customer is the importer of the goods then they will pay the VAT themselves.
If the overseas company is the importer then they will pay the import VAT and then make a domestic sale plus VAT to the customer.
If the goods are over £135 are already in the UK then it will still be the reposnsilbility of the marketplace account for the VAT on this.
Please see the guidance below:
Changes to VAT treatment of overseas goods sold to customers from 1 January 2021

Thank you.