That is what I’m also thinking about unless the marketplace sites can handle the hassle.
A know that few people are thinking that small purchases won’t be affected. Sorry, they will. The £15 VAT-free limit is being abolished. Even if you only want £1 worth shit, the firm will have to register and pay the tax up front.
With goods sold via on-line marketplaces like Tindie, Etsy, e-Bay, etc, the onus will be on the marketplace, not the individual trader, to register for VAT. So one option could be for small businesses is to sell via such sites. Which, of course, means paying the marketplace / auction site’s fees in addition to the VAT. Whatever, it’s the consumer that will suffer.
The only saving grace is that private sales between individuals, and gifts, will still be tax-free up to £39.
https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021