VAT in Budget 2026: marketplaces, overseas services and charging points
Online marketplaces will collect VAT for UK sellers from October 2027, the reverse charge on imported services narrows and public EV charging is confirmed at 20%.
The VAT changes in the Budget are technical, but several affect the way small businesses buy and sell. Most take effect in 2027.
Online marketplaces
From October 2027, online marketplaces will be responsible for collecting VAT on sales by UK VAT-registered businesses, and by other UK businesses selling at least £90,000 a year on that platform. Personal sales, second-hand goods and business-to-business sales are not covered. Sellers will need to check how their platform reports and pays the VAT, and adjust their own returns.
Services from overseas
From April 2027, the reverse charge on services bought from overseas will be limited to VAT-registered businesses. Overseas providers selling services to UK businesses that are not VAT-registered will have to account for UK VAT themselves.
Charging points and energy
From 1 November 2026, electricity from public and workplace electric vehicle charging points is confirmed as subject to 20% VAT. For households, the temporary 0% rate on domestic electricity is extended to 1 July 2027. From 1 April 2027, heat batteries join the energy saving materials that qualify for 5% VAT when installed in homes.
Also coming
- E-invoicing for VAT invoices from 1 April 2029.
- A Direct Debit required for VAT return liabilities from 1 April 2029.
- Mandatory software standards for till systems, to tackle sales suppression, after consultation in 2027.
This insight is general information, not advice for your circumstances. Talk to us before acting on it.