Do You Need to Be a Registered Business to Sell on Amazon UK?

Selling on Amazon UK can be a lucrative opportunity for entrepreneurs and small businesses alike. However, one common question many prospective sellers have is whether they need to be a registered business to start selling on this platform. This article explores the requirements and considerations for selling on Amazon UK, including whether business registration is necessary and the benefits of doing so.

Understanding Amazon UK Seller Accounts

To sell on Amazon UK, you must create a seller account. Amazon offers two main types of seller accounts: Individual and Professional.

1. Individual Seller Account:

   • No Business Registration Required: You can start selling as an individual without having a formal business registration.
   • Listing Fees: There are no monthly subscription fees for an Individual account, but you will be charged a per-item fee for each sale.
   • Best For: Casual sellers or those who plan to sell only a few items each month.

2. Professional Seller Account:

   • Business Registration Recommended: While you do not need to be a registered business to open a Professional account, Amazon typically requires a business entity (like a limited company or sole trader) for better management and scalability.
   • Listing Fees: There is a monthly subscription fee, but no per-item fee.
   • Best For: Serious sellers who plan to sell in bulk or on a larger scale.

Do You Need to Be a Registered Business?

In the UK, you do not necessarily need to be a registered business to sell on Amazon UK. Both individual sellers and those with a Professional account can operate as sole traders or under different business structures. However, there are several reasons why having a registered business might be beneficial:

1. Professionalism and Credibility:

   • Customer Trust: Registered businesses often appear more trustworthy to customers. A formal business name and structure can enhance your credibility and make your products more appealing.

2. Tax Implications:

   • VAT Registration: If you expect your sales to exceed the VAT threshold (£85,000 as of the 2024 tax year), you will need to register for VAT. Being a registered business makes this process more straightforward.
   • Tax Deductions: Operating under a business structure allows you to claim various tax deductions that individual sellers might not be eligible for.

3. Legal Protection:

   • Limited Liability: Registering as a limited company can provide legal protection by separating your personal assets from your business liabilities.

4. Access to Business Tools:

   • Advanced Features: A registered business may access more advanced features and tools offered by Amazon, such as enhanced brand content and better analytics.

How to Register a Business

If you decide to register a business, here’s a quick overview of the steps involved:

1. Choose a Business Structure:

   • Sole Trader: Simplest form, where you are personally responsible for any debts.
   • Partnership: Shared responsibility with others.
   • Limited Company: A separate legal entity, providing liability protection.

2. Register with HMRC:

   • For Sole Traders or Partnerships: Register for self-assessment.
   • For Limited Companies: Register with Companies House.

3. Obtain a Business Bank Account:

   • Keep your business finances separate from your personal accounts.

4. Apply for VAT Registration (if applicable):

   • Register for VAT if your annual sales exceed the threshold.

Considerations for Non-Business Sellers

Even if you choose to sell as an individual, consider the following:

1. Record-Keeping:

   • Organize Sales and Expenses: Maintain accurate records to manage your taxes and track your performance.

2. Compliance:

   • Follow Amazon’s Policies: Ensure you adhere to Amazon’s rules and regulations to avoid account suspension.

3. Growth Potential:

   • Scalability: As your sales grow, transitioning to a business account or registering your business might be a wise decision for managing increased volume and complex operations.

Conclusion

In summary, you do not need to be a registered business to sell on Amazon UK, but registering a business can offer several advantages, including increased credibility, better tax management, and legal protection. Whether you choose to operate as an individual or register a business, it's crucial to understand the requirements and benefits associated with each option to make an informed decision.

Summary Table

Aspect	Individual Seller	Professional Seller
Business Registration	Not required	Recommended
Monthly Subscription Fee	None	Yes
Per-Item Fee	Yes	None
VAT Registration	Depends on sales volume	Essential if above VAT threshold
Legal Protection	Limited	Better through limited company

By weighing the benefits and requirements, you can choose the best path for your selling journey on Amazon UK.