By SimplyVAT on April 18, 2022

Expanding into the UK Market as an International Business

Expanding into the UK market from New Zealand can seem daunting in 2022.

The new post-Brexit rules and regulations have no doubt been a deterrent for many businesses looking to sell to UK customers. While you may have reservations, the positives strongly outweigh any potential negatives, with UK consumers keener than ever to find the best products, from the best brands. 

Let’s look at some of the pros and cons of expanding your international business to the UK:


  • The UK’s eCommerce market is growing rapidly: set to increase at an annual rate of 12.98%, by 2025 the eCommerce market in the UK is expected to reach £113 billion by 2025, meaning there is no end in sight to eCommerce growth!

  • UK shoppers have a high conversion rate: ranking 3rd in Europe, UK customers are converting at an average rate of 1.88%, meaning shoppers are willing and ready to buy.

  • Consumers in the UK love shopping apps: spending an average of 3 hours and 23 minutes on shopping apps daily, UK shoppers are always on the lookout for better brands and products. 


  • UK consumers love reviews: this isn’t necessarily a drawback, but it’s important to keep in mind that good reviews are crucial to success, so excellent customer experiences are key in the UK.

  • The market is highly competitive: consumer motivations to purchase at lower prices has motivated shoppers to become highly comparative when browsing – keep in mind that trading on price alone in the UK will place you in direct competition with lots of other brands. 

  • Convenience is king in the UK: simplicity is the best route to success in the UK so ensuring your online channels are convenient and translate well to UK audiences is important. 


VAT obligations you may have when selling in the UK

Much like the EU, the UK requires businesses to charge and collect VAT when certain conditions are met. When selling to UK customers you will need to be aware of when you may trigger a VAT obligation. This will mainly depend on where your goods are at the point of sale.

There are two main categories which will affect your potential VAT obligations as a New Zealand based seller: 

Category 1: Your goods are outside of the UK at point of sale and you:

    • Sell through your own website: if your consignment value does not exceed £135 you will need to be VAT registered from first sale. This is because all imported consignments valued at less than £135 are subject to VAT in the UK. 

    • Sell through a marketplace: if your consignment value does not exceed £135 and you sell via a marketplace, the marketplace will be responsible for the collection and reporting of VAT on your behalf. If the consignment value exceeds this amount, you will need to appoint the Importer of Record (typically you or the customer) who will be responsible for the payment of import VAT and any potential customs duties. 


Category 2: Your goods are inside the UK at point of sale:

    • For both own website and marketplace sellers, holding goods within the UK at point of sale creates a taxable supply which requires you to be VAT registered from your first sale. You will then need to charge UK VAT rates on all sales made to UK customers. 

If you paid import VAT when your goods entered the UK, you can reclaim this through your VAT return, if you are not using the Flat Rate Scheme. 


Essential information when selling into the UK as an international business

Apply for an EORI number

An EORI number can identify you as the Importer of Record when importing goods into the UK, so that customs authorities know who to contact if any duties need to be paid or issues arise. 

At we can register you for an EORI number to set you up so you can sell to UK customers without a hitch. Contact our team to get started!


Amend pricing

As a seller you will have to charge the UK VAT rate applicable for your specific products on each sale to a UK customer. This means that you will need to consider the rate of VAT (standard is 20%) for your margins and price products accordingly. For an international seller who is used to charging at a different tax rate, this may take significant consideration to ensure profits aren’t lost or that prices aren’t too high for UK customers. 


Keep an eye on popular products

Popular products among UK consumers can change quickly within a niche, but the main popular categories tend to stay consistent, making for solid predictability when it comes to sourcing new offerings. Statistics from the end of last year showed that fashion remained at the top of the list among UK shoppers, as well as DIY and craft supplies, amounting to a huge 61 million buyers nationwide. 

Understanding the UK market and the products that remain popular is essential to ensure your success when expanding. 


Know the key platforms

Shopping apps are big in the UK; as both big and small brands focus more on their eCommerce activities, consumers are more frequently shopping online. Statistics show UK consumers spend an average of 82 billion hours on shopping apps, which has influenced a surge of businesses selling on Instagram and TikTok (which is an excellent trend to jump on). 

Understanding where UK consumers are shopping is important so that your products aren’t falling on deaf ears and showing up on the wrong platforms!


Have a trusted VAT partner

Expanding into the UK from New Zealand can seem scary, but with the right preparation, it’s simple. The pros of expanding into the UK in 2022 massively outweigh any concerns, and with the right VAT partner helping you understand your obligations, you won’t need to lose any sleep over the complicated stuff. 

We’ve got lots of resources for you to read through, like eBooks and YouTube explainers, but for more advice get in touch with our team who are happy to help you.

Published by SimplyVAT April 18, 2022