Introduced under the Finance Act 2016, the Fulfilment House Due Diligence Scheme is a mandatory requirement for businesses storing goods imported from outside the UK or EU prior to their sale to UK consumers.

The government-led initiative was created to prevent overseas sellers from exploiting fulfilment services to evade tax.

By joining the scheme, LTS has demonstrated that it meets HMRC’s rigorous standards of compliance, ensuring that goods stored on behalf of non-UK sellers are managed securely, transparently, and in line with UK tax law.

For ecommerce companies, working with a non-compliant fulfilment provider can carry significant risks, including financial penalties, stock seizure, and disrupted supply chains.

LTS is now able to safeguard its customers within the ecommerce space against these issues through a robust compliance framework that includes maintaining six years of audited compliance records, ensuring everything is in order before fulfilment begins by carrying out stringent client due diligence, and employing dedicated compliance staff trained to verify documents, maintain accurate records, and escalate issues promptly.

These measures also ensure that VAT obligations are fully met, preventing overseas sellers from facing unexpected tax liabilities.

In addition to its compliance credentials, LTS offers a comprehensive range of fulfilment services including storage, pick and pack, co-pack and despatch – all designed to support efficiency and growth in a highly competitive market for customers.

With studies showing that 85% of consumers will not shop with a business again after a poor delivery experience, the importance of reliable and transparent fulfilment cannot be overstated according to Dave Hands, Managing Director of LTS Global Solutions, as any compromise on this has the capability to have a big impact on a company’s success. 

To further support its approval under HMRC’s Fulfilment House Due Diligence Scheme, LTS’s onboarding process, which it has established to deliver a smooth and compliant transition for e-commerce clients entering the UK market, allows businesses to scale confidently without the risks of non-compliance and any operational disruption.

This onboarding process features detailed risk screening, verification of documentation, WMS integration, and pre-launch test cycles for goods receipt, picking, labelling, and customs procedures, which help identify potential issues early and minimise any potential operational disruptions.

Dave Hands commented: “Getting approved under HMRC’s Fulfilment House Due Diligence Scheme is a big step for us as a business and for our clients. It means businesses, especially those in the ecommerce space, can trust that their goods are handled properly and in full compliance with UK tax law.

“Our focus has always been on making fulfilment simple, reliable, and stress-free, so our clients can concentrate on growing their business without worrying about unexpected issues, while we take care of the paperwork and processes behind the scenes.

“The growth of the ecommerce market is there for all to see but the infrastructure needs to keep pace with that growth. With more businesses seeking to expand their presence beyond their domestic borders, this allows us to adapt to what is becoming a rapidly expanding market. Equally, thanks to our central location within the Golden Triangle, which sits within a 4-hour journey for around 90% of the country, we feel well placed to provide reliable and fully compliant fulfilment services to both domestic and international e-commerce businesses.”