Located in USA and looking to purchase a online store

Discussion in 'Business & Tax Advice' started by Smartweb2000, Oct 27, 2016.

  1. Smartweb2000

    Smartweb2000 Newbie

    Oct 15, 2016
    Likes Received:
    Not sure if this is the place to post this.

    I am purchasing a online store located in UK. It is an asset sell. The business is an online website that sell product; the product is an electronic items that are store at a fulfillment center in UK. When the item is order, the owner have a software that connect with the center and let them know and the center fill the order and ships to the buyer. The owner job is to just market and sell the products and add more products as needed.

    So all the selling is online. The only part that involves UK is the client are mainly UK and the product is store and fulfill by a UK fulfillment center. And so I am double checking on this as I am not sure who to talk to get this part clarified.

    Can someone shed some light on this? I google and I am not getting anywhere on license or what the UK required to operate like this. I am in the process of negotiating this and need help.
  2. bryanon

    bryanon Executive VIP

    Oct 16, 2009
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    Not sure what your question is exactly, but I'm assuming it's whether you can (legally) operate the business whilst not being based in the UK yourself?

    In this case, the answer is yes you can, as nothing stops you from selling in the UK as a foreign entity. Couple of things to bear in mind though:

    1) You fail to mention which country you're located yourself. I'd highly recommend you to speak to an accountant in your own country to make sure that you won't hit any local tax liabilities that can be easily avoided;

    2) Make sure that both the UK-based fulfillment centre and the payment processor that the site is using are happy to sign on a foreign clients. Many fulfilment centres only deal with UK residents, and the same is the case with many banks and payment processors.

    3) Bear in mind that in a lot of cases you'll still have to charge the 20% UK VAT (value added tax), even if your business isn't registered in the UK. Whether this applies and whether you can claim it back or not depends largely on where you're based yourself (EU vs non-EU) and a few other aspects, but again - this is something you'll need to discuss with an accountant.