A company for an online store (eCommerce) is the selling legal entity that accepts payment from buyers, is answerable to them for the goods and pays sales taxes in the countries of delivery. Its jurisdiction is chosen by the location of the warehouse, the buyers' countries and the availability of payment services. Offshore registration does not remove tax in the buyer's country: VAT and duties are paid where the parcel arrives.
Four questions before registration
- Where the goods are stored. A warehouse in the EU, the UK or the US creates tax obligations in that country regardless of where the company is registered.
- Where the parcels go. The country of delivery sets the VAT and duty rules for private buyers.
- How you sell. Through your own website or through a marketplace: in the EU and the UK a marketplace is in some cases itself treated as the seller for VAT purposes.
- Who accepts the payments. Card acquiring is not available to companies in every country.
Payment service
As of October 23, 2026, Stripe supports businesses in 51 countries and regions. The list includes the UK, the US, Estonia, Cyprus, Singapore, Hong Kong and the UAE, while the British Virgin Islands, Seychelles, Belize and Panama are not on it. When onboarding, payment providers and marketplaces request the seller's documents, a refund policy, customer support contacts and proof of delivery. Ways of accepting money are covered in the article payment processing and card acquiring.
VAT and duties in the European Union
Since July 1, 2021, EU VAT rules for e-commerce have applied:
- for EU sellers, national distance selling thresholds have been replaced by a common threshold of €10,000 a year; below it, sales may be subject to VAT in the seller's country;
- the VAT exemption for small consignments has been abolished, and tax is paid on imported consignments of any value;
- for goods in consignments of up to €150 imported from outside the EU, the Import One Stop Shop (IOSS) scheme applies: the seller charges VAT at the point of sale and files one return in the chosen country;
- if a sale from outside the EU goes through a marketplace, for VAT purposes the marketplace is deemed to have received and sold the goods.
From July 1, 2026, a temporary customs duty of €3 per item by tariff classification has been introduced on such parcels of up to €150. Five identical T-shirts count as one item; a T-shirt and a watch count as two. The seller or importer declares and pays the duty. Importing batches into a European warehouse requires an EORI number; more on this in the guide international trading company.
VAT in the United Kingdom
Since January 1, 2021, when goods in a consignment of up to £135 that are outside the UK at the time of sale are sold, the overseas seller charges UK VAT at the point of sale and registers with HMRC. If the sale goes through an online marketplace, the marketplace is treated as the supplier for VAT. Consignments above £135 follow the normal import VAT rules. If the goods are stored in a UK warehouse, there is no value limit, and a seller with no UK business registers with HMRC regardless of turnover. A UK company is covered on the page offshore company in England.
Sales tax in the United States
In 2018, in South Dakota v. Wayfair, the US Supreme Court overturned the rule under which a state could require a seller to collect sales tax only if the seller had a physical presence. The case concerned a South Dakota law requiring sellers to collect tax if they delivered more than $100,000 of goods or services into the state in a year or made 200 or more separate transactions. Other states apply similar economic nexus thresholds, so a seller with no warehouse in a state may have to register and collect tax. Each state has its own thresholds and rules. A US company is not always needed: it is compared with other options on the page US LLC for non-residents.
A two-year budget
In addition to registration and annual company maintenance, budget for:
- VAT and duties in the buyers' countries, customs broker costs;
- warehousing and logistics (3PL), cargo insurance;
- payment service and marketplace fees, a reserve for refunds and chargebacks;
- tax automation and returns in each country of registration;
- bookkeeping and bank fees.
Calculate three scenarios: no sales, planned turnover, and a payment service delaying payouts by several weeks.
Example
A brand buys accessories in China, stores the goods in an EU warehouse and sells through its own website. In this setup a BVI company does not remove the import and VAT obligations in the EU, and it makes card acquiring harder to set up. More often the options considered are a company in the country of the warehouse or in a jurisdiction on the payment provider's list, with the supply chain to the manufacturer built separately, for example through Hong Kong.
Common mistakes
- Looking for a "tax-free offshore company for a store" without calculating VAT in the buyers' countries.
- Registering a company where the payment service you need is unavailable.
- Giving a payment provider or marketplace a fictitious business address.
- Changing the selling company after launch: you will have to reconnect payments and transfer contracts.
Next step
The subscription model with recurring charges is covered separately in the guide to a SaaS company. How a bank looks at currency payments to suppliers is described in the article on currency settlements of a foreign company, and standard trade structures on offshore structures for IT, trade and holding.
Send us a description of the goods, the countries of suppliers, the warehouse and buyers, the sales channels and the expected turnover. Offshora will propose 2–3 models with taxes, a payment route and two-year costs. Submit a request.
Tell us about your task, and we will propose a jurisdiction, the scope of services and the order of work.
Send a request →