How do I sell products without VAT?

Intro: Sell as hobby or small business

Many dream of starting their own small online store to sell handmade goods, art, specialty products, or maybe just a few things from a hobby project. But the thought of VAT, accounting, and complicated rules can seem overwhelming. Fortunately, it's possible to sell products without VAT under certain conditions – especially if your business is small.

This guide will make you smarter about when you can sell VAT-free and how to approach it in the easiest way, so you can focus on creating and selling your products.

Who can sell without VAT? – VAT exemption

When your revenue is under threshold

You can start a business and sell goods or services without having to register for VAT if your expected annual revenue is under a certain threshold. This is called "VAT exemption for small businesses" and is a big advantage for hobby businesses, smaller freelancers, or you who just want to test a business idea.

Here are the most important points to remember when you sell VAT-free:

  • No VAT registration: You don't need to register for VAT. Your business can simply run under your personal number as a sole proprietorship.
  • No VAT on sales: You don't need to add VAT on top of your prices. Your prices are the prices the customer pays, without VAT addition.
  • No VAT deduction: Conversely, you also can't deduct the VAT you pay yourself when you buy materials or services for your business (called "input VAT").
  • Inform about VAT-free sales: It's good practice (and often a requirement) to inform your customers that your sales are VAT-free. This can be done on your online store, your invoices, or receipts with text such as "This sale is without VAT in accordance with VAT law".
  • Keep an eye on revenue: It's your responsibility to keep track of your total revenue. If you expect or discover that you exceed the threshold within 12 months, you must register for VAT.

How to set up an online store without VAT

Selling without VAT makes your startup much simpler. You avoid complex accounting and administration and can focus on the actual sales.

Choose a user-friendly platform

The first step is to find an online store solution that's easy to use for a beginner and doesn't require technical skills. Many online store solutions are built with VAT-liable businesses in mind, but a platform like GoShup.com is designed to be the easiest online store system, perfect for you who want to start small. Here you don't need to think about complex VAT settings – you just enter your prices without VAT.

Set up your products and prices

When you create your products on your online store, you simply enter the price you want the customer to pay. Since you're selling without VAT, this is your final selling price. You therefore don't need to think about adding VAT – the price is by default "VAT-exempt".

Invoicing and receipts

Even though you're selling without VAT, it's still important to give your customers some form of receipt or invoice. This should clearly show what they've bought, for how much, and that the sale is VAT-free. A good online store solution will automatically generate these for you, and you can often add a standard text about the sale being VAT-free.

What happens if you exceed the threshold?

If your success grows and your revenue exceeds the threshold within a 12-month period, you must register for VAT. This must happen before you exceed the threshold. VAT registration means that from that point you must charge VAT on your sales (typically 20-25%), settle VAT with the tax authorities, and then you'll also be able to deduct input VAT from your expenses.

Switching from VAT-free to VAT-liable sales is a natural part of business growth. A user-friendly platform like GoShup.com makes this transition easy, as you can simply adjust your settings and prices to include VAT when the time comes.

Start your VAT-free online store today

Starting an online store without VAT is an excellent way to test your business idea, sell your creations, or supplement your income without drowning in administration. It gives you freedom to focus on what you love: your products and your customers. With the right tools, it's both easy and manageable to get started.