UK Ecommerce Chart of Accounts for Xero with VAT Codes (Free)

An online seller’s books are dominated by things a high-street shop never sees: stock imported through customs, fees billed from other countries, and VAT paid to HMRC rather than to a supplier. A generic chart cannot tell those apart. This is a UK ecommerce chart of accounts built for Xero, with import costs, marketplace fees, and processing fees each coded for the way their VAT actually works. It comes as a readable reference CSV and a ready-to-import CSV.

Import costs and where the VAT really sits

The reflex this chart trains is simple: the overseas supplier’s invoice is not where you reclaim UK import VAT. So the inbound freight and import duty account is coded for the cost itself, not for a phantom reclaim. International freight is zero-rated and customs duty is outside the scope of VAT, so the account defaults to Zero Rated Expenses with standard and No VAT listed as alternatives. The actual import VAT you recover comes from the C79 certificate or, under postponed VAT accounting, from your monthly postponed import VAT statement, recorded against the VAT return rather than against this account. The note on the account spells that out so nobody codes a reclaim off the wrong document.

Marketplace and processing fees are expenses, not cost of goods

Cost of goods sold is the stock you buy plus the costs directly attributable to getting it in. Everything a platform charges to sell or to take payment is an operating expense, and the chart splits them out: marketplace and selling fees for Amazon, Etsy, and eBay, and payment processing fees for Stripe and PayPal. Lumping either into cost of goods quietly distorts gross margin, which is the number an online business lives by, so the separation is deliberate.

The reverse charge on overseas-billed fees

Platform fees turn on where the entity billing you is established. A fee from a UK-registered entity carries UK VAT you reclaim normally, so the marketplace and processing accounts default to 20% (VAT on Expenses). A fee billed from an overseas entity for a B2B service generally falls under the reverse charge, so each account lists Reverse Charge Expenses (20%) as the allowed alternative. The trap is treating a no-VAT overseas fee as if it carried reclaimable input VAT, or skipping the reverse-charge entry entirely, and coding the account correctly is what prevents both.

The account code prefills, you decide the line

Every VAT code here is a default that Xero prefills onto the transaction line, after the contact and item defaults, and you can override any line. The processing fee account defaults to standard for the UK-billed common case, with the reverse charge and the exempt treatment available where the supplier’s status differs. That is why the readable CSV pairs a default with the other valid codes per account.

How to use it

1. Open the reference CSV and adapt the account names to your store, keeping the import, fee, and packaging accounts.
2. In Xero go to Accounting, then Chart of accounts, then Import, and upload the CSV into a demo organisation first.
3. Confirm the zero, standard, and reverse-charge rates exist in your org.
4. Set up a routine for recording import VAT from the C79 or postponed statement, separate from the supplier invoice.

The recurring work is a high volume of cross-border invoices in several currencies:

• Hubdoc collects recurring platform and supplier statements.
• ExpenseFlow reads each receipt and supplier invoice, extracts the line detail and currency, flags a foreign-supplier purchase that carries no UK VAT, and posts it into Xero against the right account, so the import and fee coding holds as volume grows.
• Dext applies supplier rules for repeat overseas vendors.

For the £135 threshold, postponed VAT accounting, and fee treatment in full, see the UK ecommerce expenses guide. On QuickBooks instead? See the UK ecommerce chart of accounts for QuickBooks. For the codes, see the UK VAT codes in Xero reference.