UK Ecommerce VAT Legislation 2021 - Non Established Seller and OMP Dispute

Hi, A Non-Established UK seller has been already storing and selling for 18 months at online marketplace (OMP) in UK Recently it received email from OMP that it might be Non-established for UK tax purposes. If no supporting documents are given within 60 days, then as per UK Ecommerce VAT Legislation 2021, OMP will declare the seller as Non-established for UK tax purposes and will collect all unpaid VAT due on all B2C sales for the last 18 months (since it started selling at OMP). My question is that seller was not aware of UK Ecommerce VAT Legislation 2021 and OMP was responsible (in compliance with UK Ecommerce VAT Legislation 2021 ) to ensure which seller is UK Established and which one not to collect and remit VAT on sales. OMP has stopped all disbursement of seller until the unpaid VAT is recovered. The seller has not collected any tax on sales for the last 18 months. In this scenario, it is clearly OMP mistake who did not verify or ask for seller's verification as UK Established. Is there any HMRC guideline which protects/helps Non-established sellers in such scenario where OMP did not fulfil its obligation from beginning of 2021 (in compliance with UK Ecommerce VAT Legislation 2021) and OMP just realized it in January 2024 after 3 years Thanks

Hi Amazo,
The rules regarding responsibity for accounting for output tax when a Non Established Business trades via a marketplace is clearly detailed in the guidance below:
Changes to VAT treatment of overseas goods sold to customers from 1 January 2021
HMRC do not instruct the marketplace as to whether a business is Non Established or not.
This would be decided by the marketplace after engaging with the customer and after providing any appropriate information required for them to make the informed decision.
Therefore it is essentially a third party dispute between the seller and the marketplace.
If you require further help please contact our online selling team at onlineselling.uk@hmrc.gov.uk.
Thank you.