Dropshipping looks simple on the storefront: a UK customer pays, a supplier abroad ships the parcel, and you never touch the stock. At the UK border, though, somebody has to be the importer, collect the VAT and answer for the duty. If you plan dropshipping to the UK, the answer to “who is the importer?” depends on two things: the value of the consignment and whether an online marketplace sits between you and the buyer.
Why the importer question matters in dropshipping
In a classic dropshipping model, three parties touch the sale: you (the seller), your supplier (often outside the UK) and the end customer. HMRC does not care who owns the warehouse. It cares who sells the goods, who is named on the customs declaration and who is liable for import VAT and Customs Duty. Get this wrong and the parcel can be held, the customer can receive an unexpected bill from the courier, or you can end up liable for VAT you never charged.
The UK rules split the problem in two: consignments of £135 or less, and everything above that value.
Consignments of £135 or less: VAT at the point of sale
For goods sold to customers in Great Britain in consignments worth £135 or less, VAT is not collected at the border. Instead, it is charged at the point of sale. GOV.UK states that the seller must charge and account for VAT at the point of sale, and that the £135 limit applies to the value of the total consignment, not to individual items.
- You sell through your own website – you, as the seller, charge UK VAT at checkout and account for it to HMRC, which means registering for UK VAT.
- You sell through an online marketplace – GOV.UK says the online marketplace will be liable for the VAT on these consignments and charges it at the point of sale.
- The buyer is a UK VAT-registered business – if the customer gives you their UK VAT registration number, you do not charge VAT; in Great Britain the customer accounts for it under the reverse charge.
Excise goods (such as alcohol and tobacco) and non-commercial goods such as gifts are outside these rules. The £135 point-of-sale regime described here applies to Great Britain; Northern Ireland follows different rules, so check the separate GOV.UK guidance if you ship there.
Customs Duty on low value parcels – and the coming reform
At the time of writing, GOV.UK confirms that Customs Duty is not charged on non-excise goods worth £135 or less sent to Great Britain. That relief is being reformed. In its July 2026 consultation response on low value imports, the government said it intends to make sellers, or online marketplaces where they facilitate a sale, responsible for paying Customs Duty on these consignments, with duty paid quarterly and the new arrangements delivered by October 2028 at the latest. Sellers and marketplaces without a UK presence are expected to need a UK fiscal representative, and the VAT side of the regime is still being considered. If your margins depend on duty-free parcels, plan for that change now.
Consignments over £135: normal import rules apply
Above £135, GOV.UK is clear that normal VAT and customs rules apply on importation. A customs declaration is made, import VAT and any Customs Duty are due at the border, and the person in whose name the declaration is made is liable for the import duty. In dropshipping that usually means one of two set-ups:
- Delivered duty paid (DDP) – you or your supplier act as the importer, need a GB EORI number (or use a customs agent who declares on your behalf), pay the duty and import VAT, and the customer receives the parcel with nothing more to pay. Easy Clearance explains who is really the importer under DDP terms.
- Not duty paid – the customer becomes the importer. The courier or Royal Mail contacts them and collects VAT, duty and any delivery or clearance charges before delivery. If the customer does not pay, GOV.UK says the parcel is typically returned to the sender.
If you import as a UK VAT-registered business, you can usually account for import VAT through postponed VAT accounting on your VAT return instead of paying it at the border.
Stock already in the UK: the marketplace and registration rules
Some sellers move from pure dropshipping to holding stock in a UK warehouse or fulfilment centre. That changes the picture. Overseas sellers who own goods in the UK at the point of sale and sell them directly to customers must register for UK VAT. If an online marketplace facilitates the sale and the seller is not established in the UK, the marketplace is liable for the VAT on the sale to the consumer – but GOV.UK states that the seller remains liable for any import VAT and Customs Duty when the goods are first imported. Our guide to customs and import VAT for Amazon FBA sellers covers this model in detail.
Checklist before you start dropshipping to the UK
- Map every order flow: own website, marketplace, B2B buyers.
- Check the total consignment value against the £135 threshold, including how your supplier groups items into parcels.
- Decide whether you need UK VAT registration for point-of-sale VAT.
- For orders over £135, agree the delivery terms (DDP or not) and who will be named as importer.
- Get a GB EORI number if you or your supplier will import in your name.
- Confirm commodity codes and origin so duty is calculated correctly.
- Exclude excise goods and restricted goods from your catalogue unless you have a compliant route.
- Model the full cost per order with a UK import landed cost calculator.
- Track the low value imports reform and its October 2028 deadline.
For a deeper look at the VAT and duty split in this model, see Easy Clearance’s guide to dropshipping to the UK: who is the importer and who pays VAT and duty. If you ship higher-value orders and want the declarations handled for you, Easy Clearance is a customs agency registered in CDS with a UK EORI number.
Mini-FAQ
Who is the importer when I dropship to UK customers?
It depends on the value of the consignment and the delivery terms. In Great Britain, for consignments of £135 or less, VAT is charged at the point of sale by the seller, or by the online marketplace if it facilitates the sale. For consignments over £135, normal import rules apply: the person in whose name the customs declaration is made is liable for import duty – usually the seller (or its customs agent) when goods are shipped duty paid, otherwise the customer.
Do I need to register for UK VAT as an overseas dropshipper?
If you sell consignments of £135 or less directly to UK consumers (not through an online marketplace), GOV.UK says you must charge and account for UK VAT at the point of sale, which in practice means registering for UK VAT. If an online marketplace facilitates the sale, the marketplace is liable for that VAT instead. Overseas sellers who own goods in the UK at the point of sale and sell them directly to customers must also register, with limited exemptions for zero-rated supplies.
Is there customs duty on dropshipped parcels worth £135 or less?
At the time of writing, non-excise goods in consignments of £135 or less are not charged Customs Duty in Great Britain. The government has confirmed it will reform this relief: in its July 2026 consultation response it said it plans to make sellers, or online marketplaces where they facilitate a sale, responsible for paying duty on low value imports, with the new arrangements due by October 2028 at the latest.
Does the £135 limit apply per item or per order?
Per consignment. GOV.UK states that the £135 threshold applies to the value of the total consignment that is imported, not to each item in it. Excise goods and gifts are outside these rules and follow separate import guidance.
Sources (gov.uk): VAT and overseas goods sold directly to customers in the UK; VAT and overseas goods sold to customers in the UK using online marketplaces; Tax and duty on goods sent from abroad; Reforming the customs treatment of low value imports into the UK. Rules change – check GOV.UK before you set up your sales model.