UK Tax Liabilities for Drop Shipping in the USA as a UK company


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Hi Everyone,

We have a VAT registered UK company and have been drop shipping within the UK for a couple of years.

We are about to start drop shipping in the USA (although our business will remain fully located in the UK). We will be advertising items on ebay.com (USA) and when a customer purchases an item, the item will be shipped directly from a USA supplier to the USA customer.

What would be our tax liabilities on this kind of setup? Would we have to pay any US tax, either on income/profit or on product sales (e.g US equivalent of VAT) or would we just pay UK tax on profits and not add VAT on those sales?

Thank you :)
 
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With regards to your Corporation tax, as a U.K. resident your company is required to include in its tax return its worldwide income. If any tax is paid overseas then that tax will be deducted when CT is calculated.
In relation to VAT in USA, I think they have sales tax which works similar to VAT, but I am not specialist in USA taxes.
 

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