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Part of Do I need a business licence to sell online in the UK?
Do I need a business licence to sell online in the UK?
Selling online needs no single licence, but VAT, ICO data protection and product rules can apply. Check what your UK ecommerce business must register.
What to take away
- There is no general business licence to sell online in the UK. You need only licences tied to your products, premises or activities.
- VAT registration is required once taxable turnover passes £90,000, the threshold HMRC set from 1 April 2024.
- Data protection registration with the ICO can apply separately, including to sole traders who handle customer data.
- Food, alcohol, medicines and some other goods carry extra registrations or licences.
- Your legal structure, sole trader or limited company, changes how you register, not whether you may sell.
There is no single business licence to sell online
Online selling is not licensed as an activity in the way that driving a taxi or selling alcohol is licensed. In England, Scotland and Wales, you can use the GOV.UK licence finder to check whether your particular goods or services need a permit. The tool sends you to the relevant authority, which may be a council, the Environment Agency or another regulator.
Check if you need a licence
Do you sell online in England, Scotland or Wales?
Use GOV.UK licence finder
Check NI Direct and relevant department
Northern Ireland has separate rules for some activities, so check NI Direct and the relevant department. Your legal structure does not create a licence to sell online. A sole trader can trade after registering with HMRC, while a limited company must be incorporated. Comparing sole trader vs limited company helps you choose the reporting and risk profile that fits.
When VAT registration applies to online sellers
VAT is a tax registration, not a licence, but it is the rule most online sellers meet first. HMRC requires registration when taxable turnover in a rolling 12-month period goes above £90,000, the threshold from 1 April 2024.
VAT registration threshold
£90,000
Rolling 12-month taxable turnover
Threshold from 1 April 2024
HMRC requires registration above this
Selling through an online marketplace does not always remove that duty, because marketplace VAT rules depend on the goods and the seller's status. If you sell only occasionally as a hobby, different tests may apply, but regular sales with profit intent usually count as business activity.
Data protection registration for ecommerce
If you collect names, addresses, emails or payment details, you are processing personal data. The ICO's UK GDPR guidance explains the rules that apply across the UK. Many ecommerce businesses must pay a data protection fee unless an exemption applies.
The fee is set by the ICO and depends on size and turnover, with a tier for micro-organisations. Check the ICO's registration self-assessment before assuming you are exempt. You also need a lawful basis for marketing emails, and cookie rules sit alongside UK GDPR.
Product licences and registrations to check
Product rules are where most online sellers need a specific registration. Food businesses must register with the local council before trading, including home kitchens. Alcohol sales need a premises licence or a permitted temporary event route, and distance selling adds age verification duties.
Medicines, veterinary products, toys and electrical goods have their own safety and labelling rules. If you sell to consumers, the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 give cancellation and information rights that apply to distance sales.
Scotland, Wales and Northern Ireland can add separate requirements for some licensed activities, so check the devolved authority as well as your council.
| Activity | Likely requirement | Who to check |
|---|---|---|
| Selling packaged food online | Food business registration | Local council |
| Selling alcohol online | Premises licence or equivalent | Local council |
| Selling toys or electricals | Product safety and labelling duties | Trading Standards |
| Selling digital services | VAT place of supply rules | HMRC |
| Collecting customer data | Data protection fee | ICO |
Company registration and trading structure
Choosing a structure is separate from licensing. A sole trader registers with HMRC for Self Assessment. A limited company must be incorporated at Companies House and file accounts and confirmation statements.
If you choose the company route, the step-by-step guide on register a company with Companies House sets out the filings. The structure affects tax, liability and public records, not whether you need a product licence.
Common questions
Do I need a licence to sell on Amazon or eBay?
No general marketplace licence exists. The platform may collect VAT on some sales, but you remain responsible for your own registrations and product compliance.
Do I need to register for VAT if I sell online below £90,000?
Not usually, unless you are already VAT-registered or sell goods in ways that create a VAT liability. HMRC's £90,000 threshold applies to taxable turnover in a rolling 12-month period from 1 April 2024.
Do I need to register with the ICO as a sole trader?
If you process personal data and no exemption applies, yes. The ICO's self-assessment helps you decide whether you must pay the data protection fee.
Can I sell food from home online?
You normally need to register the food business with your local council before you start trading, even if you work from a home kitchen. Registration is free, but inspections and food safety rules follow.
