Chancellor John Healey's Autumn Budget on 28/10/2026 will force Amazon, eBay and other marketplaces to collect VAT for third-party sellers with turnover over £90,000, raising £1bn by closing loopholes used by overseas sellers with sham UK companies. This measure aims to level the playing field and fund business rates relief for high street retailers, including possible rises in the small business rates threshold.

The £1bn Revenue Measure and Fiscal Context

  • Online marketplaces will become responsible for VAT collection on behalf of qualifying sellers.
  • Targets overseas sellers exploiting loopholes via fake UK entities.
  • Revenue will support business rates relief amid manifesto limits on major income tax, VAT or National Insurance rises.
  • Speculation continues around bank taxes to ease broader fiscal pressures.

Who Is Most Affected?

UK sole traders and self-employed sellers on platforms face new compliance if turnover exceeds £90,000. Overseas sellers using sham structures will see the biggest impact, while bricks-and-mortar shops may benefit from rates savings. Landlords and small online businesses should review their structures immediately.

Step-by-Step Guide to Calculate Your Exposure

Use free UK VAT and tax calculators or HMRC self-assessment tools to estimate liabilities and cashflow effects:

  1. Gather your annual turnover figures from the past 12 months.
  2. Input data into an HMRC VAT registration calculator or approved self-assessment software.
  3. Factor in the new marketplace collection rules to project additional VAT liabilities.
  4. Compare against potential business rates relief thresholds for high street savings.
  5. Analyse overall cashflow impact, including any software update costs.

Preparing for the Changes

  • Update your accounting software to handle marketplace VAT reporting by 28/10/2026.
  • Organise detailed records of sales channels and turnover to demonstrate compliance.
  • Review overseas seller status if applicable.
  • Consult a tax adviser for personalised advice ahead of the announcement.

High street retailers should check eligibility for rates relief once details emerge.

What to Do Before and After the Budget

Before 28/10/2026, run your numbers today. After the announcement, adjust records and software promptly. Act now to avoid surprises.

Calculate your seller exposure or high street savings in a UK tax calculator today.