E-commerce Accounting & Tax Services in the UK

Our UK e-commerce accounting services are built for online sellers navigating the British market:

• Direct-to-Consumer (DTC) Brands: UK-based brands selling via Shopify, BigCommerce, or WooCommerce who need to manage inventory, process returns, and comply with UK VAT laws.
• Amazon FBA Sellers: Businesses using Amazon's UK fulfillment network, requiring careful tracking of FBA fees, inventory stored in the UK, and VAT on sales.
• Subscription Box Businesses: Companies with a recurring revenue model needing specialized accounting for deferred revenue and analysis of customer lifetime value (LTV).
• International Brands Entering the UK: Foreign companies that have formed a UK Limited Company to sell to British customers and need expert guidance on import VAT, customs duties, and UK tax compliance.

From your first sale, accurate bookkeeping is essential. However, specialized e-commerce accounting becomes critical at these key moments:

• When You Approach the VAT Threshold: Once your UK sales exceed £90,000 in a rolling 12-month period, you must register for VAT. This is a non-negotiable legal requirement that brings with it quarterly MTD filing obligations.
• When You Hold Inventory: Properly accounting for Cost of Goods Sold (COGS) is fundamental to understanding your gross profit. This is not optional; it's a core part of business accounting.
• When You Sell on Multiple Channels: Selling on your own site and Amazon UK creates complex reconciliation challenges, as each platform has different fee structures and payout schedules.
• When You Import Goods: Importing products into the UK requires managing import VAT and customs duties, which must be correctly accounted for to be reclaimed or expensed.

Outsourcing your e-commerce accounting is a direct investment in your compliance and profitability. Costs in the UK vary based on transaction volume and complexity.

• Small Stores / Single Channel: £400 - £900 per month. This covers MTD-compliant bookkeeping, VAT return filing, and reconciliation for one sales channel.
• Growing Brands / Multi-Channel: £900 - £2,500 per month. This typically includes management of more complex inventory and reconciliation across multiple platforms (e.g., Shopify + Amazon).
• Large-Scale Sellers: Custom pricing starting at £2,500+, often involving integration with advanced inventory management systems and fractional CFO services.

The UK e-commerce environment has several compliance pitfalls that can lead to significant penalties:

• VAT Non-Compliance: This is the single biggest risk. Failing to register for VAT when required, or filing incorrect or late MTD returns, leads to automatic and escalating penalties from HMRC.
• Incorrect COGS Calculation: Improperly valuing your inventory or miscalculating Cost of Goods Sold leads to an inaccurate profit figure and can result in overpaying Corporation Tax.
• Marketplace Reconciliation Errors: Failing to correctly reconcile payouts from platforms like Amazon can mask hidden costs, high refund rates, or even fraud.
• Post-Brexit Trade Complexities: Since Brexit, new rules apply to selling goods between the UK and the EU, adding another layer of VAT and customs complexity that must be managed.

E-commerce finance, particularly in the UK, is a niche specialism. Most general accountants lack the specific knowledge required to handle MTD for VAT, multi-channel inventory systems, and the fee structures of platforms like Shopify and Amazon. Hiring a full-time e-commerce specialist is often too costly for a growing brand.

Outsourcing to YourLegal's e-commerce finance team provides a cost-effective solution. We leverage specialized software to automate VAT tracking and MTD filings, integrate with your inventory systems, and accurately reconcile all your sales data. This ensures you are always compliant with HMRC, have a crystal-clear view of your product-profitability, and can make data-driven decisions about pricing, advertising, and expansion. Our services integrate seamlessly with our core UK tax compliance solutions, providing a complete financial back-office for your online store.