No, you do not need a business licence to sell on Amazon in the UK. There is no such thing as a general “business licence” in British law, so the question, though sensible, is built on an American idea that does not map onto how selling here works. What you do need is to register with HMRC, keep clean records, and meet a handful of rules that depend on what you sell.
We hear this worry from brands about to make their first sale. It usually comes wrapped in a fear of doing something illegal before they have earned a penny. The good news is that the real requirements are clearer, cheaper, and faster to sort than most people expect.
This post lays out exactly what you must register, when VAT starts to matter, whether to trade as a sole trader or a limited company, and which products carry extra obligations. Read it and you will know precisely what stands between you and a compliant Amazon UK account.
Why “do I need a business licence to sell on Amazon” is the wrong question
The phrase “business licence” comes from the United States, where many states and cities do require sellers to hold one. British sellers pick up the term from American YouTube videos and blog posts, then assume the same rule applies here. It does not.
In the UK, you can start trading straight away without asking anyone’s permission. There is no central licence to buy, no form that grants you the right to sell online. The obligations that do exist sit with HMRC for tax and with specific product regulations for safety, and those are the things worth your attention.
You do not need a licence to sell on Amazon UK, but you do need to register as a business and follow the rules tied to your products.
What you actually need to sell on Amazon UK
The core requirement is registering with HMRC. Once your trading income passes £1,000 in a tax year, you must register for Self Assessment as a sole trader, a threshold set out plainly in the government’s guidance for sole traders. Below that figure, the trading allowance covers you and no registration is needed.
Registration gives you a Unique Taxpayer Reference, or UTR. Amazon asks for your business details during sign-up, verifies your identity, and expects the tax information that ties your account to a real, registered trader. This verification is a legal requirement for online marketplaces, not an Amazon quirk, so there is no route around it.
You will also choose a selling plan when you register: the Individual plan at £0.75 per item sold, or the Professional plan at £25 per month excluding VAT. Neither is a licence. Both simply set how Amazon charges you for access to the marketplace.
One habit pays off from day one: speaking to a professional business advisor and/or accountant. They will be able to guide you on the best business setup for your own situation and goals. Nothing in this post is financial advice for you personally because we don’t know all of the details, but instead leans on topics which have come up with some clients.
To sell on Amazon UK you need HMRC registration, a UTR, and a verified Amazon seller account, not a licence.
Sole trader or limited company: which should you register as?
Amazon accepts both, so this is a business decision rather than a compliance one. Trading as a sole trader is the simplest start: you register in minutes, file one Self Assessment return a year, and keep your admin light. For many first-time sellers testing an idea, that is the sensible entry point.
A limited company adds a layer of protection and, past a certain profit level, can be more tax-efficient. Your personal assets sit behind the company, which matters more as your order volume and liability grow. The trade-off is more paperwork, Companies House filings, and stricter record-keeping.
We are Amazon growth specialists, not accountants, so treat this as context rather than tax advice and confirm the right structure with a qualified accountant before you commit. The point to hold onto is simple: your choice of structure affects your tax and liability, never your right to sell on Amazon.
When VAT enters the picture
VAT is where more sellers slip up than anywhere else. If your taxable turnover goes over £90,000 in any rolling twelve-month period, or you expect to cross that figure within the next 30 days, VAT registration becomes mandatory. Plenty of growing brands hit this threshold mid-year without noticing and land a nasty backdated bill.
Registering voluntarily below the threshold is allowed, and sometimes worthwhile if you want to reclaim VAT on stock and fees. The maths depends on your margins and customers, so it is worth a proper look rather than a snap decision.
One rule catches out overseas sellers in particular: if your business is based outside the UK but you sell to UK customers, you must register for VAT from your very first sale. There is no threshold grace period for non-UK established businesses. For those sellers, Amazon calculates, collects, and remits the VAT on many sales directly, which changes your cash flow and your pricing sums, so build it into your figures rather than discovering it on your first payout.
VAT registration is mandatory once your taxable turnover passes £90,000, or immediately if your business is based outside the UK.
The products that do need extra permissions
No product needs a “licence” in the American sense, but plenty carry their own compliance rules, and Amazon enforces many of them at the listing stage. Selling food means registering as a food business with your local authority, usually at least 28 days before you start. Cosmetics require a safety assessment and product notification before they can go on sale.
Electricals, toys, and many other goods must carry UKCA or CE marking to show they meet UK safety standards. Age-restricted products, from bladed items to certain supplements, come with their own controls. Amazon also gates some categories behind approval, so you apply to sell before your listings go live.
None of this is a barrier so much as a checklist. The sellers who run into trouble are the ones who list first and read the rules later, only to have compliant competitors report them or Amazon suppress the listing.
Specific products need safety compliance, registration, or category approval, but not a general business licence.
What to do next
Start by registering with HMRC as a sole trader, or forming a limited company if that suits your plans, and note down your UTR. Open your Amazon seller account with those business details ready, then check whether your specific product category needs safety compliance or Amazon approval before you build listings. Keep an eye on your rolling turnover so VAT never surprises you.
If you would rather have an expert walk you through setup for your exact category, that is what our one-to-one expert coaching sessions are built for, complete with pre-session research on your brand. For those getting started around a full-time job, our guide on selling on Amazon while employed covers how to fit the admin and the operational load around your existing hours.
Where Reflex fits
We help consumer brands turn a confident start on Amazon UK into steady, profitable growth. Getting the foundations right, registration, structure, VAT, and product compliance, saves you the expensive clean-up jobs we see far too often when brands guess their way through setup.
If you want a second pair of expert eyes before you launch, book a free consulting call with us through our contact page, or follow Steve on LinkedIn for regular, practical Amazon growth content.