Not on the High Street Accounting 2026 - Complete UK NOTHS Bookkeeping Guide

Not on the High Street Accounting - What UK Sellers Need to Know

Not on the High Street accounting is the process of recording, categorising and reconciling your NOTHS sales, fees, refunds, shipping income, payout deposits, VAT and business expenses. NOTHS is a curated marketplace for small creative brands, personalised products, handmade gifts, homeware, jewellery, food gifts and independent UK sellers. The platform handles the customer-facing marketplace experience, but your bookkeeping, tax records and VAT compliance remain your responsibility.

A common mistake is to record only the amount that arrives in your bank account. That is usually the net payout, not the true sales figure. Good NOTHS bookkeeping separates the full customer sale from marketplace commission, shipping income, refunds, packaging costs, material costs and tax. This gives you a reliable profit and loss report and helps you monitor VAT registration thresholds correctly.

This guide is written for sole traders, partnerships and limited companies selling on Not on the High Street in the UK. It also links naturally to related resources such as our Etsy accounting guide, VAT registration guide, and ecommerce accounting hub.

How NOTHS Payments and Seller Payouts Work

Understanding the NOTHS payment flow is essential before setting up your accounts. The customer pays through the marketplace, NOTHS deducts seller fees or commission according to the seller agreement, and the remaining amount is paid to your nominated bank account. Your bank receipt is therefore only one part of the full accounting story.

NOTHS Fees - How to Record Not on the High Street Seller Fees

Correctly recording Not on the High Street fees is one of the most important parts of NOTHS accounting. Fees affect your gross margin, VAT threshold monitoring, tax-deductible expenses and product pricing. If you only post the net bank receipt, you will understate both sales and marketplace costs.

1. One-Off Joining Fee

NOTHS states that sellers do not pay an annual membership renewal fee and that there is a one-off joining fee. Publicly available marketplace guides commonly cite this joining fee as £199 + VAT, but seller charges can change and your exact fee should always be confirmed in your current NOTHS application or partner agreement.

In your accounts, record the joining fee as a business expense such as Marketplace Fees, Platform Setup Costs or Subscriptions and Memberships. If you are VAT-registered and receive a valid VAT invoice, the VAT element may be recoverable as input VAT.

2. NOTHS Sales Commission

Public marketplace sources commonly describe NOTHS commission as 25% of sales. Because marketplace rates can vary or change, your bookkeeping policy should say: “Post NOTHS commission using the actual commission shown on the monthly seller statement.” This avoids relying on estimated percentages.

Record commission as a separate expense account, for example Marketplace Commission - NOTHS. This keeps your profit and loss report clean and shows whether your pricing leaves enough margin after commission, materials, postage and labour.

3. Advertising and Promotional Fees

If you pay for promoted placement, marketing features, advertising campaigns or other optional promotional activity, post these costs to Advertising and Marketing. Do not mix them with sales commission because advertising is discretionary while commission is linked directly to orders.

4. Refunds, Cancellations and Adjustments

Refunds should be recorded as a reduction of sales or a separate contra-income account called Returns and Refunds - NOTHS. If the original commission is reversed or adjusted, post the reversal against the commission expense account. This makes your return rate visible and helps identify products with quality or sizing problems.

Gross vs Net Method for NOTHS Bookkeeping

NOTHS sellers should understand the difference between gross accounting and net accounting. The gross method records the full customer sale as income and the NOTHS fee as a separate expense. The net method records only the amount received in your bank account.

Setting Up Bookkeeping for Your NOTHS Shop

Follow this step-by-step NOTHS bookkeeping process to keep your accounts clean throughout 2026. The process works whether you use Xero, QuickBooks Online, FreeAgent or a spreadsheet reviewed by your accountant.

1. Open a Separate Business Bank Account

   Keep NOTHS income and business expenses separate from personal spending. A dedicated business bank account makes bank reconciliation easier, supports tax records and avoids confusion when HMRC or your accountant reviews your figures.

2. Choose Accounting Software

   Most UK sellers use Xero, QuickBooks Online or FreeAgent. Choose software that supports bank feeds, VAT returns, Making Tax Digital, receipt storage and easy accountant access. Spreadsheets can work for early-stage sellers, but they become risky as order volume grows.

3. Create NOTHS-Specific Accounts

   Create income accounts for NOTHS Product Sales and NOTHS Shipping Income. Create expense accounts for NOTHS Commission, NOTHS Joining Fee, NOTHS Advertising, Postage and Couriers, Packaging, Cost of Materials and Refunds.

4. Download the Monthly NOTHS Seller Statement

   Your NOTHS seller statement is the main source document for bookkeeping. Download it every month and save it in a cloud folder by tax year and month. The statement should support sales, fees, refunds, shipping and payout entries.

5. Post Gross Sales

   Record the full customer sales value before commission deductions. Split income between product sales and shipping where possible. If you sell mixed VAT-rate products, split sales by VAT treatment as well.

6. Post NOTHS Fees Separately

   Post marketplace commission, joining fee, advertising charges and any other NOTHS costs to separate expense accounts. This helps you calculate net profit by channel and understand whether NOTHS is more or less profitable than Etsy, Shopify, Amazon Handmade or your own website.

7. Reconcile the Net Payout to Your Bank

   Match the net payout on the NOTHS seller statement to the deposit on your business bank statement. If the bank amount differs, check timing, refunds, adjustments, payout dates and any manual corrections.

8. Record Refunds and Returns

   Post customer refunds as returns or contra-income. If commission is reversed, reduce the commission expense accordingly. Track returns separately so you can spot product quality issues, sizing problems or delivery-related refund patterns.

9. Track Cost of Goods Sold

   Record materials, packaging, labels, blanks, ingredients, components and outsourced production costs. Your true profit is not just sales minus NOTHS fees; it is sales minus commission, materials, packaging, postage, labour, software, advertising and overheads.

10. Monitor VAT Threshold Monthly

    Track your rolling 12-month taxable turnover using gross sales, not just net payouts. The UK VAT registration threshold is £90,000, so sellers approaching this figure should review VAT registration with an accountant before the deadline is missed.

11. Prepare for Making Tax Digital

    From April 2026, Making Tax Digital for Income Tax starts for qualifying sole traders and landlords above the relevant income threshold. NOTHS sole traders should keep digital records and use compatible software where required.

12. Archive Records for Tax Evidence

    Save seller statements, NOTHS invoices, bank statements, expense receipts, VAT returns, postage invoices and accounting exports. Good digital records make year-end accounts, Self Assessment and Corporation Tax filing much easier.

NOTHS Accounting in Xero, QuickBooks and FreeAgent

Not on the High Street does not usually have the same direct accounting ecosystem as Shopify, Amazon or Etsy. That means many sellers use a monthly journal entry, bank feed rules and manual reconciliation. This is still reliable when done consistently.

Recommended Xero Setup for NOTHS Sellers

• Create income account: Sales - Not on the High Street.
• Create income account: Shipping Income - NOTHS.
• Create expense account: Marketplace Commission - NOTHS.
• Create expense account: NOTHS Joining Fee.
• Create expense account: NOTHS Advertising and Promotions.
• Create contra-income account: Returns and Refunds - NOTHS.
• Create current asset clearing account: NOTHS Clearing Account.
• Use bank rules only after the gross sales and fee split has been posted.

Recommended QuickBooks Setup for NOTHS Sellers

• Create products/services for NOTHS product sales and shipping income.
• Create expense categories for commission, joining fee, advertising and postage.
• Use classes or locations if you also sell on Etsy, Shopify, Amazon or eBay.
• Use a clearing account if statement totals and bank payout timing differ.
• Match the bank deposit to the payout summary instead of posting it as direct income.

Example Monthly NOTHS Journal Entry

VAT for Not on the High Street Sellers in 2026

UK VAT rules apply to your business, not just to the marketplace. If your taxable turnover goes over the VAT threshold, you must register for VAT. In 2026, the VAT registration threshold is £90,000, and the deregistration threshold is £88,000.

VAT turnover should be monitored using taxable turnover, which generally means the value of taxable supplies before deducting marketplace commission. This is why gross bookkeeping is important. If you only record net payouts, you may think you are below the VAT threshold when your gross marketplace sales are actually above it.

Common VAT Rates for NOTHS Products

Making Tax Digital for NOTHS Sellers in 2026

Making Tax Digital for Income Tax begins in phases from 6 April 2026. Sole traders and landlords with qualifying income over £50,000 for the 2024/25 tax year are expected to use MTD for Income Tax from April 2026. The threshold then moves to over £30,000 from April 2027 and over £20,000 from April 2028.

If you sell on NOTHS as a sole trader, this means you should prepare for digital records, MTD-compatible software, quarterly updates and a final declaration. Limited companies are not in the same MTD for Income Tax category, but they still need proper company accounting records and Corporation Tax filings.

NOTHS Payout Reconciliation Process

NOTHS payout reconciliation means matching the net payout in your bank account to the seller statement and proving the difference between gross sales and bank receipt. This is the same principle used in Shopify payout reconciliation and Amazon settlement reconciliation.

1. Download the Seller Statement

   Get the statement for the payout month. Confirm the statement covers the correct order dates, refund dates and payout period.

2. Find the Bank Deposit

   Locate the NOTHS payout in your bank feed. Note the date, amount and reference. The bank date may differ from the statement period.

3. Split the Statement

   Separate product sales, shipping income, commission, refunds, advertising, adjustments and payout total.

4. Post the Accounting Entry

   Record gross sales and shipping income, debit fees and refunds, then match the net result to the bank payout.

5. Check VAT Codes

   Apply VAT codes based on product category, seller VAT status and invoice evidence. Do not apply one VAT code to all products without review.

6. Archive Evidence

   Save the statement, bank reconciliation, VAT reports, invoices and receipts so the month can be reviewed later.

NOTHS Reports and Records You Should Keep

• Monthly NOTHS seller statements.
• NOTHS joining fee invoice and any VAT invoice.
• Commission and marketplace fee breakdowns.
• Refund and return reports.
• Bank statements showing payout deposits.
• Postage, courier and Royal Mail invoices.
• Packaging and material purchase receipts.
• VAT return workings and VAT code reports.
• Year-end stock count and cost of goods records.
• Accounting software exports or accountant workpapers.

Common NOTHS Accounting Mistakes and How to Fix Them

Mistake 1: Recording Only Net Payouts as Sales

Problem: This understates turnover and hides fees.

Fix: Use the gross method. Record full product sales and shipping income, then record NOTHS commission and other charges separately.

Mistake 2: Treating the Joining Fee as an Annual Renewal

Problem: Some older or generic articles describe an annual fee, but NOTHS FAQ says there is no annual membership renewal fee.

Fix: Record the joining cost as a one-off marketplace setup or platform cost, unless your own partner agreement says otherwise.

Mistake 3: Monitoring VAT Threshold Using Bank Receipts

Problem: Net bank payouts are after commission and may be lower than taxable turnover.

Fix: Monitor gross taxable sales on a rolling 12-month basis.

Mistake 4: Mixing Postage Income and Postage Costs

Problem: Sellers often offset postage charged to customers against Royal Mail or courier costs.

Fix: Record shipping charged to customers as income and postage/courier costs as expenses. This shows whether your delivery pricing is profitable.

Mistake 5: Forgetting Cost of Materials

Problem: Sales reports can look profitable until materials, packaging and labour are included.

Fix: Track cost of goods sold by product category and review margins monthly.

Mistake 6: Leaving Refunds Hidden in Payout Differences

Problem: Refunds reduce the payout, but if not recorded separately, return rates are invisible.

Fix: Use a dedicated Returns and Refunds account.

NOTHS vs Etsy, Amazon Handmade, Shopify and eBay Accounting

Can You Automate Not on the High Street Bookkeeping?

NOTHS accounting is usually less automated than Shopify, Amazon or Etsy bookkeeping. Many sellers use a monthly manual statement journal because it is simple, reliable and easy for accountants to review. However, you can still reduce manual work.

Automation Options

• Monthly journal template: Fastest and most reliable for many NOTHS sellers.
• Xero or QuickBooks bank rules: Useful for matching payout deposits after the statement has been posted.
• Spreadsheet import: Good for sellers with many order lines and consistent statements.
• Zapier or Make: Possible if your order workflow exports data to Sheets or accounting software.
• Custom integration: Useful for larger sellers with multi-channel inventory and order management systems.

Monthly NOTHS Bookkeeping Checklist

• Download NOTHS monthly seller statement.
• Save joining fee, advertising and marketplace invoices.
• Record gross product sales.
• Record shipping income separately.
• Record NOTHS commission as an expense.
• Record refunds and commission reversals.
• Match net payout to bank statement.
• Reconcile postage, courier and packaging costs.
• Update cost of goods sold or material usage.
• Check VAT threshold using rolling 12-month gross taxable sales.
• Review MTD obligations if you are a sole trader.
• Upload receipts to your accounting software.
• Review product margins and bestselling categories.
• Flag unmatched payout differences before month end.

Best Practice Chart of Accounts for NOTHS Sellers