Can I claim expenses for products sent as free samples or giveaways?

Yes, products given away as samples for business promotion purposes are generally allowable business expenses. You can claim the cost of goods sent to influencers, reviewers, or as promotional giveaways. The key is maintaining clear records showing the business purpose. LOYALS helps e-commerce clients structure and document these expenses properly to withstand HMRC scrutiny.

Do I need to charge VAT on international sales from the UK?

It depends on where you are selling and where your goods are located. Sales to UK consumers attract UK VAT at 20% once you are registered. For sales to EU customers, post-Brexit rules mean you may need to register for VAT in individual EU countries or use the One Stop Shop (OSS) scheme. Sales outside the EU are generally zero-rated. LOYALS navigates these complex rules for e-commerce clients selling internationally.

What does HMRC's digital platform reporting mean for online sellers?

Since January 2024, digital platforms like Amazon, eBay, and Etsy are required to report seller income data directly to HMRC. This includes your identity, transaction volumes, and total earnings. HMRC uses this data to cross-check against Self Assessment returns. If you have not been declaring your online income, HMRC now has the tools to identify the gap. LOYALS ensures your returns match exactly what platforms report.

How much does an e-commerce accountant cost in London?

LOYALS offers three e-commerce accounting packages: Premium Accounting at £150/month (complete chartered accounting with multi-platform reconciliation), Business Mentor at £250/month (adds dedicated mentor and scaling strategy), and Business Growth Programme at £2,000/month (full business team including marketing, legal, and sales support). Self Assessment tax returns are available from £300 one-off for sellers earning under £50,000.

E-Commerce Accountant London | Online Sellers & Amazon FBA | Chartered | LOYALS

E-Commerce Accounting Specialists

Stop Guessing Your Numbers.Start Scaling With Confidence.

Q: Should I set up a limited company for my online store?

If your e-commerce profits exceed £50,000, incorporating as a limited company can reduce your tax burden through a salary-plus-dividends strategy. You also gain limited liability protection, which is especially important if you hold significant inventory or deal with international suppliers. LOYALS models both scenarios for your specific situation so you can make a data-driven decision.

Q: Can my accountant help reduce marketplace fees?

While accountants cannot change marketplace fee rates, LOYALS provides detailed fee analysis that reveals exactly how much each platform costs you per product. This data helps you make strategic decisions about which platforms to prioritise, when to launch your own website, and whether to switch from FBA to self-fulfilment. Many clients save thousands by optimising their channel mix based on our profitability analysis.

Q: What records do I need to keep as an online seller?

HMRC requires you to keep records of all sales and income, purchase invoices and receipts, bank statements, platform settlement reports, inventory records, shipping costs, and any import/export documentation. Records must be kept for at least five years after the Self Assessment deadline. With Making Tax Digital launching in April 2026 for businesses over £50,000, digital record-keeping is now essential. LOYALS sets up cloud-based systems that automate this process.

From marketplace sellers to D2C brands — we speak e-commerce. Multi-platform reconciliation, VAT compliance, and HMRC-ready accounting so you can focus on growing your online business.

67,186 new e-commerce businesses launched in the UK in 2023 — a 57% growth surge

Book Free E-Commerce Consultation Call 07450 258975 Call Now — We're Open Book Free Consultation

⭐ 4.8★ Google Rating

👥 500+ London Clients

💷 £500K+ Recovered

🏛️ Chartered Accountants

E-Commerce Accounting Is Different. We Get That.

Running an online business means juggling platforms, payment processors, inventory, international VAT, and an HMRC that is paying closer attention than ever. These are the challenges we solve every day.

📦

Multi-Channel Inventory Tracking

Selling across Amazon, eBay, Etsy, and your own Shopify store means stock levels, purchase costs, and returns need reconciling across every channel to get accurate cost of goods sold figures.

💸

Marketplace Fee Reconciliation

Referral fees, fulfilment fees, storage charges, advertising costs, subscription fees — every marketplace takes its cut differently. We break down exactly where your money goes, platform by platform.

🌍

VAT on International Sales

Post-Brexit rules mean selling to EU customers requires navigating country-specific VAT registrations, the One Stop Shop scheme, and different threshold rules. Getting it wrong means penalties and backdated charges.

💳

Payment Processor Reconciliation

Stripe, PayPal, Klarna, Amazon Pay — each processor holds funds differently, charges different fees, and pays out on different schedules. We match every penny from sale to bank deposit.

📊

Cost of Goods Sold Calculations

Accurate COGS means knowing the true cost of every product including shipping to your warehouse, import duties, damaged stock, and returns. Without this, your profit figures are fiction.

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HMRC's Increasing Focus on Online Sellers

Since January 2024, Amazon, eBay, Etsy, and other platforms report your sales data directly to HMRC. If your tax returns do not match what the platforms report, expect questions — or worse.

Who We Help

Whether you are just starting out with a side hustle or running a multi-channel empire, LOYALS provides the specialist accounting support your e-commerce business needs to grow confidently.

📦 Amazon FBA Sellers

🏷️ eBay Power Sellers

🎨 Etsy Shop Owners

🛒 Shopify Stores

🌐 WooCommerce Stores

📱 Multi-Channel Retailers

🚚 Dropshippers

🖨️ Print-on-Demand Businesses

🏠 D2C Brands

📲 Social Commerce Sellers

E-Commerce Accounting Services

Hover or tap each card to see exactly how we help your online business stay compliant and profitable.

🔄

Multi-Platform Reconciliation

Matching sales, fees, and payouts across every channel

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Multi-Platform Reconciliation

Amazon settlement report analysis
eBay managed payments matching
Shopify / WooCommerce bank reconciliation
Cross-platform revenue consolidation
Refund and chargeback tracking

📦

Inventory & COGS Tracking

Knowing your true product cost and stock value

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Inventory & COGS Tracking

Opening and closing stock valuation
Purchase cost tracking with shipping
Damaged and returned goods accounting
Import duties and customs allocations
Real-time inventory cost reporting

💰

Marketplace Fee Analysis

Understanding exactly what each platform costs you

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Marketplace Fee Analysis

Referral and commission breakdowns
FBA fulfilment fee tracking
Storage fee monitoring and alerts
Advertising cost allocation (PPC/Sponsored)
Platform profitability comparison

🌍

VAT for International Sellers

Navigating UK, EU, and global VAT obligations

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VAT for International Sellers

UK VAT registration and returns
EU One Stop Shop (OSS) compliance
Import VAT and PVA management
Amazon VAT Services coordination
Cross-border transaction classification

💳

Payment Gateway Reconciliation

Every processor, every fee, every deposit accounted for

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Payment Gateway Reconciliation

Stripe fee and payout matching
PayPal transaction reconciliation
Klarna / Clearpay settlement tracking
Currency conversion cost capture
Chargeback and dispute accounting

📈

Profitability by Product

Know which products actually make you money

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Profitability by Product

True margin calculation per SKU
Fee impact analysis by channel
Advertising cost per sale reporting
Loss-making product identification
Strategic pricing recommendations

VAT for E-Commerce Sellers — Made Simple

VAT is one of the biggest compliance headaches for online sellers. Here is what you need to know and how we make it painless.

£90,000

UK VAT registration threshold (2025). This is based on rolling 12-month taxable turnover across all your sales channels combined.

When to Register for VAT

You must register when your total taxable turnover across all platforms exceeds £90,000 in any 12-month period — or if you expect to exceed it within the next 30 days alone. Many multi-channel sellers cross this threshold faster than they realise because turnover from Amazon, eBay, Etsy, and your own website all count together. LOYALS monitors your combined turnover proactively so you never miss the deadline.

EU and International Sales VAT

Since Brexit, selling to EU consumers requires careful consideration of each country's VAT rules. If you store goods in an EU country (such as through Amazon's Pan-European FBA programme), you likely need VAT registration in that country. For direct-to-consumer sales from the UK, the EU's One Stop Shop (OSS) scheme can simplify reporting by allowing you to declare EU VAT through a single registration.

Amazon and Marketplace VAT

Amazon, eBay, and other marketplaces now handle VAT collection on certain transactions — particularly for goods shipped from overseas into the UK. However, this does not remove your obligation to maintain accurate VAT records, file returns, and ensure the marketplace is applying the correct rates. LOYALS reconciles what marketplaces collect on your behalf with your own VAT position to prevent double-counting or gaps.

Common VAT Mistakes Online Sellers Make

The most frequent errors we see include not monitoring the £90,000 rolling threshold across all channels, failing to register for VAT in EU countries where stock is held, incorrectly treating all international sales as zero-rated, and not reclaiming input VAT on business expenses like advertising, software subscriptions, and shipping costs. Each of these mistakes can result in backdated assessments and penalties.

Making Your Numbers Work Harder

Good accounting does not just keep HMRC happy — it shows you exactly where to grow, what to cut, and when to scale.

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Product Profitability Analysis

We calculate true margins on every product line after all fees, shipping, advertising, and returns. Stop guessing which products make money and start making data-driven decisions about your catalogue.

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Fee Optimisation Strategies

Our detailed fee analysis reveals which platforms give you the best return and where you are overpaying. We help you negotiate better terms, adjust pricing, and choose the right fulfilment strategy for each channel.

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FBA vs Own Fulfilment

There comes a point where running your own fulfilment is cheaper than Amazon FBA. We model the break-even point for your business so you can time the transition and protect your margins as you grow.

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Scaling Tax-Efficiently

Should you incorporate? When does a salary-plus-dividends strategy save you money? How do you structure international expansion? LOYALS plans your growth so every scaling decision is tax-smart.

HMRC Is Watching Online Sellers More Closely Than Ever

Since January 2024, digital platforms including Amazon, eBay, Etsy, Vinted, and Depop have been required to collect and report seller data directly to HMRC. The first full reports were submitted by 31 January 2025, and HMRC is already using this data to send "nudge letters" to sellers whose declared income does not match platform records.

HMRC has invested heavily in recruiting additional compliance officers, and online sellers are a priority target. The tax authority can now cross-reference your platform sales data against your Self Assessment returns automatically — and discrepancies trigger enquiries.

Here is what this means for you:

Platforms report your identity, transaction volumes, and total earnings to HMRC annually
Sellers with income over £1,000 who are not registered for Self Assessment face penalties
HMRC can backdate tax bills for multiple years if undeclared income is discovered
Making Tax Digital for Income Tax launches April 2026 for businesses earning over £50,000, requiring quarterly digital submissions

Get Your E-Commerce Accounting HMRC-Ready →

E-Commerce Accounting Packages

Every package includes chartered accountant expertise with deep e-commerce knowledge. Choose the level of support your online business needs right now.

Premium Accounting

£150/month

Best for: Established sellers needing compliant, accurate accounts

Complete chartered accounting

Multi-platform sales reconciliation

Self Assessment / Corporation Tax returns

VAT returns and compliance

Professional invoice management

Debt recovery service

Year-round HMRC correspondence handling

Get Started →

Business Mentor

£250/month

Best for: Scaling brands wanting strategic guidance and growth support

Everything in Premium Accounting

Dedicated business mentor

Product profitability analysis

Fee optimisation strategy

Professional quote preparation

On-demand support

Scaling and incorporation advice

Book Free Consultation →

Business Growth Programme

£2,000/month

Best for: Serious expansion — building a brand, not just a store

Everything in Business Mentor

Complete business team access

Marketing and brand support

Legal consultancy on demand

Office support and admin

Sales coaching and strategy

500+ client networking introductions

Scale Your Business →

Self Assessment for Online Sellers

If you are self-employed selling online, here are your two options based on annual turnover.

Under £50,000 Turnover

£300 one-off

Full preparation and submission to HMRC, tax optimisation, expense review, HMRC correspondence handling, deadline management, and Payment on Account reduction claims. Everything you need to stay compliant and pay the right amount of tax.

£50,000+ Turnover

£600 per year

Everything in the £300 tier, plus quarterly tax preparation and filing for Making Tax Digital (MTD) compliance launching April 2026. HMRC will require quarterly digital submissions of income and expenses — we prepare and file these on your behalf using your bank statements, plus your final year-end declaration, proactive Payment on Account management, and pension planning advice.

What Our Clients Say

Online sellers across London trust LOYALS to keep their accounts clean and their businesses growing.

★★★★★

"I was selling on three platforms and had no idea what my actual profit was after all the fees. LOYALS broke it down product by product — turns out two of my best-selling items were barely breaking even. That analysis alone paid for a year of accounting."

James T.

Amazon FBA Seller, Hackney

★★★★★

"When HMRC sent me a letter about my eBay sales, I panicked. LOYALS sorted everything out, got my Self Assessment filed properly, and even claimed expenses I didn't know I could. Completely stress-free now."

Sarah M.

eBay Seller, Camden

★★★★★

"Moving from Etsy to multi-channel selling was a nightmare for my books until LOYALS took over. They reconcile everything across Etsy, Shopify, and Amazon so I just see one clear picture of my business. Weekend availability is a lifesaver."

Priya K.

Handmade Jewellery Brand, Islington

★★★★★

"LOYALS helped me understand when to register for VAT and how to set up my Shopify store properly for Making Tax Digital. Their Business Mentor package means I always have someone to call when I'm making big decisions about scaling."

Daniel R.

D2C Fashion Brand, Southwark

Frequently Asked Questions

Answers to the most common e-commerce accounting questions we hear from online sellers across London.

How do I account for Amazon FBA fees and commissions? +

Amazon FBA involves multiple fee types including referral fees, fulfilment fees, monthly and long-term storage fees, and advertising costs. Each one needs to be tracked separately and reconciled against your settlement reports. LOYALS analyses your Amazon Seller Central data alongside your bank deposits so every fee is captured, every allowable expense is claimed, and your true product-level profitability is clear. This means you know exactly how much you are keeping from every sale — not just what Amazon shows on the surface.

When should I register for VAT as an online seller? +

You must register for VAT when your taxable turnover exceeds £90,000 in any rolling 12-month period. This includes sales across every platform — Amazon, eBay, Etsy, your own website — all added together. Many e-commerce sellers cross this threshold faster than they expect because multi-channel revenue accumulates quickly. LOYALS monitors your combined turnover proactively so you never miss the registration deadline and risk backdated VAT charges. We also advise on whether voluntary registration (even below the threshold) could benefit your business through input VAT reclaim.

Can I claim for products sent as free samples or giveaways? +

Yes, products given away for business promotion purposes are generally allowable expenses. This includes items sent to influencers, reviewers, competition winners, or as promotional giveaways. The key is documenting the business purpose clearly — who received the product, why, and what promotional activity resulted. LOYALS helps e-commerce clients structure and record these expenses properly so they stand up to HMRC scrutiny and reduce your tax bill legitimately.

How do I track inventory across multiple platforms? +

Multi-platform inventory tracking requires reconciling stock levels and costs across Amazon, eBay, Shopify, and any other channels you sell through. You need to account for opening stock, new purchases (including shipping and duties), returns, damaged goods, and closing stock to calculate accurate cost of goods sold. LOYALS sets up systematic inventory tracking that feeds directly into your accounts, giving you clear visibility of your true profitability — not just by channel, but by individual product.

Do I need to charge VAT on international sales? +

It depends on the destination and your circumstances. UK consumer sales attract VAT at 20% once you are registered. For EU customers, post-Brexit rules mean you may need to register in individual EU countries or use the One Stop Shop (OSS) scheme. If you hold stock in EU warehouses through programmes like Amazon Pan-European FBA, you almost certainly need EU VAT registrations. Sales outside the EU are generally zero-rated for VAT purposes. LOYALS navigates these complex international rules so your e-commerce business charges the right VAT in the right places.

What does HMRC's digital platform reporting mean for me? +

Since January 2024, platforms like Amazon, eBay, and Etsy report seller data — including your identity, transaction volumes, and total earnings — directly to HMRC. Reports are submitted by 31 January each year. HMRC uses this data to cross-check your Self Assessment returns and has already started sending enquiry letters to sellers where the numbers do not match. If you have been earning above the £1,000 trading allowance without declaring it, HMRC now has the data to find out. LOYALS ensures your tax returns align precisely with what platforms are reporting.

How much does an e-commerce accountant cost? +

LOYALS offers three packages tailored to e-commerce businesses. Premium Accounting costs £150 per month and includes full chartered accounting with multi-platform reconciliation. Business Mentor costs £250 per month and adds a dedicated mentor for growth strategy and product profitability analysis. The Business Growth Programme at £2,000 per month provides a complete business team including marketing, legal, and sales support. For self-employed sellers, Self Assessment starts from £300 one-off (under £50K turnover) or £600 per year (£50K+ with MTD quarterly filing). We are open seven days a week including weekends.

Should I set up a limited company for my online store? +

If your e-commerce profits consistently exceed £50,000, incorporating as a limited company can reduce your overall tax through a salary-plus-dividends strategy. You also gain limited liability protection — particularly important if you hold significant inventory or deal with international suppliers. However, incorporation comes with additional responsibilities and costs including Companies House filing and more complex accounting. LOYALS models both scenarios with your real numbers so you can make the decision based on data rather than guesswork.

Can my accountant help reduce my marketplace fees? +

While we cannot change marketplace fee rates, our detailed fee analysis reveals exactly how much each platform costs you per product. This data helps you make strategic decisions about which platforms to prioritise, when to launch your own direct-to-consumer website, and whether switching from FBA to self-fulfilment makes financial sense. Many LOYALS clients save thousands annually by optimising their channel mix and pricing strategy based on our profitability analysis.

What records do I need to keep as an online seller? +

HMRC requires records of all sales and income, purchase invoices and receipts, bank statements, platform settlement reports, inventory records, shipping costs, and any import or export documentation. All records must be kept for at least five years after the Self Assessment filing deadline. With Making Tax Digital for Income Tax launching April 2026 for businesses turning over £50,000 or more, digital record-keeping is now essential. LOYALS sets up cloud-based systems that automate this process, keeping you compliant with zero admin burden.

How is dropshipping taxed in the UK? +

Dropshipping income is taxed like any other self-employment or business income. You pay Income Tax on profits above your Personal Allowance (£12,570) and National Insurance Contributions on profits above the relevant thresholds. If your turnover exceeds £90,000, you must register for VAT. The main challenge with dropshipping is accurately tracking costs when you never physically handle stock — supplier invoices, platform fees, advertising spend, and payment processor charges all need careful recording. LOYALS helps dropshippers maintain clean, compliant records and claim every legitimate expense.

Do I need to file a tax return if I sell on eBay as a hobby? +

If you earn more than £1,000 from selling items you bought or made with the intention of reselling at a profit, you must register for Self Assessment and file a tax return. Selling personal belongings at a loss — for example, clearing out your wardrobe — is generally not taxable. However, HMRC now receives platform data directly, and if your selling patterns look like trading, you may receive an enquiry letter asking you to explain. LOYALS can assess your situation, determine whether your activity crosses the line into trading, and ensure you are properly registered if needed.

Grow Your E-Commerce Business With Confidence

Join 500+ London businesses who trust LOYALS for chartered accounting, business growth, and complete peace of mind with HMRC. Available seven days a week, including weekends.

Book Your Free E-Commerce Consultation →

Or call us directly: 07450 258975 | kris.nick@loyals.uk

Serving e-commerce businesses across all London boroughs: Westminster, Camden, Islington, Hackney, Tower Hamlets, City of London, Southwark, Lambeth, Wandsworth, Hammersmith & Fulham, Kensington & Chelsea, Greenwich, Lewisham, Newham, Barnet, Brent, Ealing, Enfield, Haringey, Hounslow, Redbridge, Richmond, Waltham Forest, Croydon, Bromley, and beyond. Based in King's Cross, London N7 9DP.