I dropship from China only so do I need to register for VAT?

Answer

If you are a dropshipper using a Chinese supplier, e.g. AliExpress, then most likely these sales will be considered out of scope for VAT. Have a read of our VAT for Dropshippers post for a more detailed treatment.

Should I register anyway to reclaim VAT?

For this to be beneficial to your business, the VAT you pay needs to exceed the cost of filing VAT returns. If you are predominantly using Facebook for advertising, you are not paying VAT on this cost as Facebook uses the reverse charge mechanism (i.e. it does not charge businesses VAT, regardless of VAT registration). You can use our Instant Quote to get an idea of the cost of handling your VAT returns and VAT registration; if this exceeds what you might reclaim, then you should not register.

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