VAT
Digital services to EU consumers are taxed where the customer lives. Non-Union OSS, evidence requirements and how UK sellers register since Brexit.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 12 September 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
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QuickBooks PartnerCertified ProAdvisor100+ yearsCombined team experienceFully insuredUp to £2m indemnityDigital services sold to EU consumers are taxed in the customer's country at that country's rate, from the first sale, with no threshold for UK sellers. Most register for the non-Union One Stop Shop in a single EU member state to file one return.
What counts as a digital service
Registering and evidencing
Digital services sold to EU consumers are taxed in the customer's country at that country's rate, from the first sale, with no threshold for UK sellers. Most register for the non-Union One Stop Shop in a single EU member state to file one return.
Automated services delivered over the internet with minimal human intervention: software downloads, SaaS, e-books, online courses that run without a live tutor, stock images, apps and website hosting. Live tuition, bespoke consultancy delivered by email and physical goods are not digital services.
Sales to EU businesses fall outside this and use the reverse charge instead, provided you hold the customer's VAT number.
UK sellers register for non-Union OSS in one EU member state, file a quarterly return covering all EU sales and pay in euros, rather than registering in every country. Without OSS you would need a registration in each member state where you have a consumer.
You must keep two pieces of non-contradictory evidence of customer location, typically billing address and IP address or the country of the payment card, and retain records for ten years.
Rates, thresholds and deadlines quoted here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.
Local help
We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
Often yes. If a marketplace acts as the deemed supplier, it accounts for the VAT and you are supplying the marketplace, not the consumer.
The EU threshold applies to EU established sellers only. UK sellers are outside it and must account from the first sale.
Normal UK VAT rules apply, subject to your UK registration position.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
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Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run monday to friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
