Shein's UK sales hit £2.58bn as £135 duty break nears its end
Accounts filed at Companies House show a 26 per cent rise, past Asos. The exemption that makes the model work is due to go by October 2028.
Shein's UK division sold £2.58bn of goods last year, up 26 per cent on the £2.05bn it reported for 2024, according to accounts filed at Companies House.
That puts the Chinese-founded fast-fashion retailer ahead of its British rival Asos.
Pre-tax profit at the UK arm rose 18 per cent to £45.2m, from £38.3m. The company paid £11.2m in current tax, understood to be mainly corporation tax, against £9.6m the year before.
It did that with 113 people in the UK, mostly in sales and marketing, up from 91. That is roughly £23m of sales per head.
Shein attributed the growth to a marketing tie-up with the Wireless and Creamfields festivals, a pop-up shop on Oxford Street, and Christmas gift events in Edinburgh, Manchester, Liverpool and London.
The mechanism underneath it is duller and more important. Shein ships low-cost clothes from Chinese factories straight to homes, with each order priced low enough to avoid import duty.
The UK's "de minimis" rule lets overseas sellers send goods worth £135 or less direct to British shoppers with no customs duty at all. A UK seller holding stock here gets no equivalent.
Rachel Reeves, the former chancellor, said she would remove the rule by 2028. The Treasury's response to its consultation on low value imports says delivery has been brought forward by six months, to October 2028 at the latest.
Retail bosses want it gone sooner. Sainsbury's, Currys and AO World have all argued that the relief hands overseas rivals a structural advantage.
Other governments have moved first. The United States revoked its exemption for Chinese-made goods last year, having previously spared parcels worth under $800 from import tax. In a filing lodged before its Hong Kong listing, Shein said the removal had hurt its US sales.
The EU is phasing its version out too. The European Commission said a temporary €3 customs duty would apply from 1 July 2026 to parcels worth up to €150 arriving from outside the bloc.
The parent group listed in Hong Kong last month at just over $26bn. That is a long way below the $100bn it reached in a 2022 fundraising, and below the £50bn London float it weighed in 2024. In its first results since listing, it reported quarterly group profits down 67 per cent to £173m, which it blamed on higher oil prices and freight rates linked to the war in Iran.
For a small UK e-commerce seller, the date is the story. Until October 2028 at the latest, a competitor shipping £135 parcels from abroad pays no duty on goods you pay duty to stock. After it, pricing that currently looks impossible to match becomes a question of landed cost, and anyone selling direct from overseas into Britain needs to know what their parcels will cost under the new regime before they set next year's prices.