In the United Kingdom, Stripe Tax supports calculation and collection of VAT.
When to register for tax collection
Use the Thresholds tab to get insights about your potential tax registration obligations in the United Kingdom. Stripe also notifies you with email and Dashboard alerts when you need to register to collect tax. Learn more about how the monitoring tool works.
If you’re based outside the United Kingdom, you must register in the UK within 30 days of performing the first taxable transaction there. You’re also liable to register if you have reasonable grounds to believe that you’ll perform taxable transactions within the next 30 days. A taxable transaction is any sale made in the UK that’s neither exempt from VAT nor subject to reverse charge. Taxable transactions include those that are zero-rated for VAT purposes.
For example, if you’re based in the US and sell digital services to overseas customers, you must register in the UK as soon as you have reasonable grounds to believe that a UK consumer will purchase your services. If a UK consumer has actually bought your digital services, you must register within 30 days of performing the sale. However, if you only sell to UK businesses, you don’t need to register because such sales are subject to reverse charge and don’t constitute taxable transactions for UK VAT purposes.
The HMRC VAT Notice 700/1 Who should register for VAT provides more information on registration in the UK.
Threshold: 1 transaction in the UK.
Period: Previous or current year.
Included transactions: Any taxable transactions that reverse charge doesn’t apply to.
How to register
Find more information on how to register for VAT in the United Kingdom on the government website:
After you’ve registered to collect tax in the United Kingdom, add your registrations to Stripe in the Registrations tab in the Dashboard. This turns on tax calculation and collection in Stripe for your transactions in the United Kingdom.
Learn more about how to add your registration in the Dashboard.
How we calculate taxes
Stripe calculates VAT for your transactions in the United Kingdom.
Generally, most transactions are taxable in the jurisdiction where your customer is. Stripe assumes the sale of most goods or services to be taxable unless specifically exempted.
In the United Kingdom, there are some territories outside of the scope of the standard tax system and may have different rules that should apply. Stripe won’t calculate tax for customers based there, even if you’ve added a registration for the UK. Learn more about how Stripe handles excluded territories. This applies to the following locations:
- British Virgin Islands
- Channel Islands (Guernsey and Jersey)
- Falkland Islands
How to report and file your taxes
You’re responsible for filing and remitting your taxes to the United Kingdom. Stripe doesn’t file taxes on your behalf. However, we do have trusted partners who can help manage your filing and remittance.