Starting an online store
From the numbers to your first order, with US, UK and EU notes: what to set up, in order, before you sell to consumers online.
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Time: 2 to 6 weeks
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Plan and check the numbers
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In the US, for example, children’s products need a certificate based on testing by a CPSC-accepted third-party lab.
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The margin and markup calculator gives you the price for the margin you want.
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In the US, search the USPTO database before you commit; elsewhere, check with your national trademark office.
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On a marketplace, its own rules and fees apply too.
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The emergency fund calculator tells you how much.
Set up the business
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US: most small businesses need a mix of federal and state licenses and permits. UK: register as a sole trader if you earn over £1,000 in a tax year.
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You need one if you have employees, pay excise taxes or withhold tax for non-residents; otherwise you can still ask for one, for example for a bank.
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US: self-employment tax is 15.3%, and you usually pay estimated tax each quarter if you expect to owe $1,000 or more. UK: register for Self Assessment by 5 October after the tax year.
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From April 2026 it covers self-employment and property income over £50,000, from April 2027 over £30,000, and from April 2028 over £20,000.
Sales tax and VAT
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Since the Wayfair ruling in 2018, a state can require it even if you have no physical presence there, once your sales pass its threshold.
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For example, $500,000 a year in California and Texas; $100,000 in South Dakota; and in New York, over $500,000 and more than 100 sales.
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In states like Texas, marketplace providers collect and send the tax for their sellers.
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California, for example, calls it a seller’s permit.
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If your business is based outside the UK, different rules apply: check GOV.UK before your first sale.
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Above it, you charge the VAT of the buyer’s country; the One-Stop Shop lets you declare it in one place.
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Since July 1, 2026, a temporary €3 customs duty per item applies to IOSS and postal parcels up to €150.
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US Customs has suspended duty-free treatment for parcels worth $800 or less, indefinitely.
Your store’s pages and policies
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UK and EU consumer law requires them before the customer orders.
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UK: adding unavoidable fees later in the checkout, known as drip pricing, has been banned since April 2025.
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US FTC rule: ship within the time you state, or 30 days if you state none; if you can’t, get the customer’s consent to the delay or refund promptly.
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UK and EU: 14 days to cancel from delivery for most goods, and refunds within 14 days. If you don’t tell customers, the period can stretch by 12 months.
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Since June 19, 2026, EU online stores need a clearly labeled “withdraw from contract here” function.
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EU: at least 2 years from delivery. UK: goods must be as described and fit for purpose, with 30 days to reject faulty goods.
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UK and EU: no non-essential cookies before consent. In the UK, most businesses handling personal data pay the ICO fee: £52 a year for the smallest.
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The EU General Product Safety Regulation requires it, plus a responsible business in the EU for every product.
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EU: required for online stores since June 28, 2025, except micro-enterprises. US: Justice Department guidance covers businesses open to the public.
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The FTC banned fake and bought reviews in October 2024; the UK banned fake reviews in April 2025.
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In the EU, generic environmental claims without proof are banned from September 27, 2026.
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Include your postal address, honor unsubscribe requests within 10 business days, and don’t use misleading subject lines.
After launch
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US: payment apps and marketplaces send a Form 1099-K for over $20,000 in more than 200 transactions, but you must report all your income either way.
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Platforms report sellers with 30 or more sales, or €2,000 or more, in a year.
First order shipped
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Good to know
- The rules depend on where you’re based and where your customers live: this list gives the principles, with US, UK and EU examples. Elsewhere, check your own tax and consumer protection agencies.
- Several rules changed recently: the EU withdrawal function (June 2026), the EU ban on generic green claims (September 2026), the end of US duty-free de minimis, and the UK ban on drip pricing and fake reviews (April 2025).
- No platform, app or service is recommended here: the list tells you what to check.
Frequently asked questions
Do I have to collect sales tax in every US state?
Only where you have nexus: a physical presence, or sales above the state’s economic threshold since the Wayfair ruling. Thresholds differ, such as $500,000 in California and Texas and $100,000 in South Dakota, and marketplaces often collect for you.
Do I have to accept returns?
In the UK and the EU, customers can cancel most online purchases within 14 days of delivery, without giving a reason. Elsewhere, check the rules where you sell, and write a clear policy customers can read before they buy.
When do I need to register for VAT in the UK?
When your VAT-taxable turnover for the last 12 months goes over £90,000. Businesses based outside the UK follow different rules.
Next step
I’m not an accountant or a financial advisor. This is an estimate, for information only. Check with a professional before you decide.
- The calculatorMargin and markup
- The calculatorVAT and sales tax
- The calculatorEmergency fund
- The routeSelling online
Sources
- FTC — Business guide to the Mail, Internet, or Telephone Order Merchandise Rule
- FTC — Consumer Reviews and Testimonials Rule: questions and answers
- FTC — CAN-SPAM Act: a compliance guide for business
- U.S. Supreme Court — South Dakota v. Wayfair (2018)
- California CDTFA — Wayfair: general information for remote sellers
- Texas Comptroller — Remote sellers
- Texas Comptroller — Marketplace providers and sellers
- South Dakota Department of Revenue — Remote seller bulletin
- New York State — Sales tax nexus for remote sellers
- California CDTFA — Publication 107: do you need a California seller’s permit?
- IRS — Employer identification number
- IRS — Understanding your Form 1099-K
- IRS — Self-employment tax
- IRS — Estimated taxes
- SBA — Launch your business
- CPSC — Testing and certification
- USPTO — Why search for similar trademarks
- U.S. Customs and Border Protection — Low-value shipments and de minimis
- ADA.gov — Guidance on web accessibility and the ADA
- GOV.UK — Online and distance selling for businesses
- GOV.UK — Accepting returns and giving refunds
- GOV.UK — Set up as a sole trader
- GOV.UK — Register for VAT
- GOV.UK — Selling goods or services on a digital platform
- GOV.UK — Making Tax Digital for Income Tax
- CMA — Unfair commercial practices (CMA207)
- ICO — Data protection fee
- ICO — Cookies and similar technologies
- Consumer Rights Act 2015, section 22: the 30-day right to reject (legislation.gov.uk)
- Your Europe — Returns and the 14-day withdrawal period
- Your Europe — Guarantees
- Directive (EU) 2023/2673: the online withdrawal function (EU Publications Office)
- European Commission — VAT One-Stop Shop
- European Commission — Temporary flat customs duty on low-value imports
- EUR-Lex — Regulation (EU) 2023/988 on general product safety, article 19
For registration, sales tax and VAT, work with an accountant or tax professional where you’re based; for your terms of sale, a lawyer if you’re unsure.