Hello. Question about new marketplace

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United Kingdom United Kingdom
Penny11
Kudos: 23
Joined: Mar 3, 2016
Hello. Question about new marketplace
9 Mar 2016
Hi all,
I'm totally new here, so hello!

I'm at the very beginning stages of starting an online market place and have lots of questions! I know very little but I think I have a good idea and know enough to get started....

But...can anyone here answer how I get around this...
My marketplace will be UK based but if I want to have sellers from outside of the EU selling via my marketplace how will this impact the buyer?
Will the buyer have to pay extras such as vat that will put them off buying via my site?

Thanks very much for any help!
Nottingham United Kingdom
Bigian13
Kudos: 2,313
Joined: Feb 21, 2014
Re: Hello. Question about new marketplace
11 Mar 2016
@Penny11

Welcome to the forums, and good luck with your new venture !

All items purchased from non EU countries for delivery to UK and EU countries are liable for VAT and / or customs and excise duty. You can read more here on the gov.uk website for ROW purchases into the UK. The buyer has to pay any VAT and duty before the items are delivered.

There are also issues regarding any fees that you may be charging the buyer or seller for each purchase. In this case you would be better off talking to a good accountant who is experienced in international e-commerce. Unfortunately a lot of accountants do not understand the complexities of international sales, so find one that does know what they are talking about. This will save you a lot of time, effort and pain.

There was a case last year (or maybe the year before), where a seller set up a website selling goods that were claimed to be UK based and was getting them shipped direct from China marked as 'Gift' to try to avoid the VAT. They were charging VAT on all purchases but were not paying any. Unfortunately for them they got caught and got a pretty hefty fine and a few months in jail if I remember correctly.

If you are in any doubt about the legalities of your venture, consult the experts at HMRC or UKTI.
E-commerce , love it or hate it, that's why we are here
United Kingdom United Kingdom
Penny11
Kudos: 23
Joined: Mar 3, 2016
Re: Hello. Question about new marketplace
11 Mar 2016
Hello Bigian13 and thank you for your reply and good wishes!

Ah, ok, it's as I thought. I was hoping there might be some magic answer but of course not!
Lots to think about and I will definitely look into an accountant who knows about this stuff.
Many thanks
Herts, England United Kingdom
Andy
Kudos: 11,661
Joined: Jan 1, 2001
Re: Hello. Question about new marketplace
11 Mar 2016
On a different topic Penny, marketplaces are particularly hard to start because sellers will only come if there are willing buyers, and buyers only come if there are sellers with good products, prices, customer service etc.

So the marketplace needs priming on both sides. For example people try to recruit sellers by making it cheap/free for them, and paying software providers to integrate their marketplace. They try to recruit buyers through very expensive mainstream advertising e.g. TV, bus stops etc.

I thought about starting a marketplace years ago, even bought an (expensive) domain for it... but that's another story!

Good luck
Andy Geldman, Web Retailer
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