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Buying or selling second-hand goods, art or antiques in the UK? Since Brexit two systems sit side by side. They look alike — and that is exactly where it goes wrong.
Written by Griet Coussement, founder of Vintro Pro and Vintiques Export
The VAT Margin Scheme is the UK counterpart of the European margin scheme. HMRC charges VAT not on your full selling price, but only on the difference between what you paid and what you received.
The purpose is exactly the same as on the continent: avoiding double taxation. When you buy from a private individual there was no VAT in that purchase for you to reclaim. Without a margin scheme you would be taxed a second time on money that has already been taxed.
The VAT sits inside the margin, not on top of it.
That is the same rule as in Belgium. The UK rate is 20%, and 20% contained within an amount is 20/120 — which is one sixth. That is why HMRC writes it that way. Calculate margin × 20% instead and you will pay too much.
You buy a second-hand watch for £1,200 and later sell it for £1,800.
Without the margin scheme, VAT would be charged on the full £1,800, which is £300. That £200 difference on a single watch is precisely why the scheme exists.
Where is the VAT in that £1,800?
Without the margin scheme: £300 VAT on the full £1,800. That is £200 more.
Two amounts in pounds is all it takes. The tool uses the HMRC rule: one sixth of the margin.
The scheme covers the four categories you would expect in a second-hand business:
And it explicitly does not cover:
That first exclusion is the important one, and it is logical: if you received an invoice with VAT on it, you have already been able to reclaim that VAT. There is no double taxation left to avoid. The exception: art, antiques and collectors' items you import yourself, and art bought directly from its creator — after a written election to HMRC (SI 1995/1268, art. 12).
Vehicles, horses, houseboats, caravans and pawned goods follow their own HMRC rules on top of this. If you sell those, do not rely on the general explanation.
This is the part most articles skip, and it is the part that decides how you calculate. Alongside the ordinary margin scheme sits a second system: global accounting.
You work out the margin for each item sold, separately. A loss on one item does not offset a profit on another: a negative margin simply counts as zero.
You add up all purchases and all sales in the period and take the difference. If the result is negative, that shortfall is carried forward to the next period.
Global accounting is only allowed where the purchase price per item is £500 or less. Aircraft, boats and outboard motors, caravans and motor caravans, horses and ponies and most motor vehicles are excluded — a motor vehicle only qualifies if it is sold on as scrap.
Can it go into global accounting?
Yes
Yes
Result
Global accounting is openAll purchases and sales of the period together. A shortfall carries forward.Global accounting is the UK equivalent of the Belgian globalisation method — but with a £500 per-item ceiling that Belgium does not have.
A UK business must register for VAT as soon as its taxable turnover over the past twelve months goes above £90,000. That is a rolling twelve-month period, not a calendar year: you measure again every month.
You must also register as soon as you expect to exceed that £90,000 in the next thirty days alone. Both figures have stood since 1 April 2024, when the threshold rose from £85,000 to £90,000. It is one of the highest VAT thresholds in the world.
Which figure applies to you?
Both figures have stood since 1 April 2024.
Since 1 January 2021 the UK is a third country for VAT purposes. Goods crossing the border are no longer an intra-Community supply, but an export and an import.
Selling ordinary goods from Belgium to a UK buyer is an exempt export (0%, article 39 of the Belgian VAT Code), provided the export declaration is correct. That also holds for a piece under the margin scheme: article 39 has no exception for the margin scheme, while article 39bis, for supplies within the EU, does — see selling a margin item abroad. The UK buyer pays UK duty and import VAT at the border themselves, on top of your price. Say so up front — it is the single most common reason a parcel gets refused. The exception: a consignment of £135 or less to a UK private buyer. Then it is not customs that charges the VAT but you: you must register in the UK and charge 20% UK VAT, without the margin scheme (VATA 1994 s.7(5B)).
Three rules you will read in any general VAT article do not apply here. They fall away the moment an item sits under the margin scheme — which, for you, is the rule rather than the exception.
This is where it goes wrong most often — and you only find out at the audit.
“My UK supplier sold under the margin scheme, so I can apply it when I resell.”
That is not right. The European margin scheme covers goods supplied to you within the Union — by a private individual, by an exempt business, or by another taxable dealer who applied the margin scheme themselves. A purchase in the UK is not a supply within the Union. It is an import.
The margin stops at the border
UK supplier
Margin invoice They sold under the UK margin scheme.The border
Import Not a supply within the Union. You pay Belgian import VAT and reclaim it.You resell
Ordinary VAT On the full selling price. For art, collectors’ items and antiques: 6% in Belgium.You import, pay Belgian import VAT (which you can reclaim) and then resell with ordinary VAT on the full selling price. The margin does not survive the border.
You used to be able to sell those under the margin scheme after importing them yourself. In Belgium, not since the Act of 19 December 2025: import is charged at 6%, and a reduced rate rules out the margin scheme. You deduct that 6% and resell at 6% on the full price.
What the item is decides whether your margin survives the border.
The details, with a worked example, are on buying in the UK after Brexit. Source: Belgian Act of 19 December 2025 (Official Gazette, 31 December 2025), checked on 7 October 2026.
| United Kingdom | Belgium | |
|---|---|---|
| VAT on the margin | 20% — 1/6 of the margin | 21% — 21/121 of the margin |
| Usual method | Item by item | Globalisation, per period |
| Totalling per period | Global accounting, only where purchase ≤ £500 per item | Already the usual method, with no per-item ceiling |
| Loss on an item | Counts as zero; global accounting carries the shortfall forward | Offsets within the same period |
| Registration threshold | £90,000 — but £0 if you are not established there | No threshold: you always need a VAT number. Small business exemption up to €25,000 annual turnover (€26,000 from 2027) |
| Who oversees it | HMRC | FPS Finance |
The two systems look very much alike, and that is precisely the danger: carry the Belgian habit into a UK sale and you will be totalling per period where HMRC expects a calculation per item.
Vintro Pro is built for Belgian dealers, but it accounts for those who buy and sell across the border.
Where to find this in the app: your company’s country sits in 🏢 Company settings. The VAT report is on the 📦 (stock) tab → 🛠️ Actions → under Reports → 🧾 Margin VAT calculation.
One sixth of your margin. The UK rate is 20% and that VAT is contained within the margin, so 20/120 = 1/6. On a margin of £600 you pay £100 in VAT.
£90,000 of taxable turnover over a rolling twelve-month period. If you expect not to exceed £88,000 over the next twelve months, you may ask to deregister. If you are not established in the UK there is no threshold at all: registration is required from your very first supply.
Not for ordinary second-hand goods. The EU margin scheme covers goods supplied to you within the Union, and a purchase in the UK is an import. For works of art, collectors' items and antiques, no longer in Belgium either: since the Act of 19 December 2025 the margin option exists only if no reduced rate was applied, and those goods are charged exactly that reduced rate, 6%, on import.
A second UK system in which you add up all purchases and all sales in a period instead of calculating item by item. It is only open to goods with a purchase price of £500 or less, and excludes aircraft, boats, caravans, horses and most motor vehicles.
No. That is the whole point of the scheme: you do not charge VAT on the full selling price, and you deduct nothing on the purchase side. If you were charged VAT, the item usually falls outside the margin scheme. The exception: art, antiques and collectors' items you import yourself, and art bought directly from its creator — after a written election to HMRC (SI 1995/1268, art. 12).
From the invoice: a margin scheme invoice shows no separate VAT amount. There is only a total price, often with a reference to the margin scheme. Keep that document with the item itself — at an audit, provenance is the first thing asked for.
This article is general information, not tax advice. Rates and thresholds change; check them with HMRC or your accountant before setting up a transaction. Reviewed on 20 August 2026.
Vintro Pro keeps purchase price, proof of purchase and margin per item — in euros or in pounds, with an estimate of your import costs and a VAT report per period.