If you’re receiving anything to the UK from another country, it will go through a customs check at the border. The first reason for this is to validate the items are not not banned or restricted in the UK. The second reason is to ensure you pay the correct UK customs fees. Read our guide to learn the basics of UK customs charges, such as when you have to pay them and the instances when you do not. Note this guide is purely relating to United Kingdom customs charges on import – there could also be charges levied in the country of export too.
UK Customs Charges & VAT
Whenever you receive anything from outside the UK of greater value than £135 you can expect to pay UK customs charges. When you receive anything except a gift worth under the value of £39 you might have to pay VAT too. This includes anything first or second hand that you:
- Order online
- Buy on holiday and post back to the UK
- Receive as a gift
It’s worth noting though that exporters are expected to provide point of sale prices for UK buyers that are inclusive of VAT when the item is worth under £135. For this reason, exporters to the UK are expected to be registered with HMRC in order to pay VAT themselves.
UK Customs Fees
UK customs fees are as follows:
|Type and value of goods||Customs Duty|
|Non-excise goods worth £135 or less||No charge|
|Gifts above £135 and up to £630||2.5%, but rates are lower for some goods|
|Gifts above £630 and other goods above £135||The rate depends on the type of goods and where they came from – call the helpline|
You are expected to pay Customs Duty on excise goods of any value. Excise goods can include, but are not limited to:
- Tobacco products (including cigarettes, cigars and rolling tobacco)
- Energy/electricity, e.g. petrol or diesel oil.
Gifts are defined as items sent from one individual to another for celebrations such as a birthday. New items ordered from an online retailer to an individual are not treated as gifts.
VAT is charged on all imported goods, except for gifts worth £39 or less. Though remember, if you bought the goods yourself and they are worth under £135, the seller should have included VAT in the total you already paid.
For goods over £135 you will be expected to pay VAT upon delivery.
VAT is generally charged at 20%, though some reduced rate goods such as children’s car seats are charged at 5%, whilst there are also some zero rate goods, such as children’s clothes.
Confused? It wouldn’t be surprising – there are various categories and rulings which determine the charges that are to be levied on your imports. The key points to note are:
- There are no UK customs charges for goods valued under £135.
- UK customs charges for gifts valued between £135 and £630 are 2.5%.
- UK customs charges for goods valued over £135 and gifts valued over £630 vary depending on the goods – call HMRC if you’re concerned.
- Excise goods, e.g. tobacco incur customs charges no matter the value.
- No VAT is due for gifts under £39 and goods under the value of £135 should already have VAT included in the point of sale price.
- When VAT is due on goods over £135, you’ll likely have to pay the current main rate – 20%.
How to Pay UK Customs Fees & VAT
You’ll pay VAT when you buy the goods (if under £135) or to the delivery company as you receive them. UK customs will automatically let Royal Mail or the delivery company you’ve chosen know how much you need to pay in customs charges and VAT. You don’t need to worry about calculating it yourself, unless you think a mistake has been made, e.g. the goods have been classified in the wrong category.
If you have to pay VAT to the delivery company, it’s charged on the total package value, including:
- The value of the goods
- Postage, packaging and insurance costs
- Duty you owe
That’s correct – if you are required to pay VAT, you can expect to pay VAT on your customs duty charges as well.
If you are importing something of grand size that costs a lot, you could use a UK currency broker to pay for it, and moreover – good brokerages will help you with paying all import taxes (customs and tax), as they have specific experience with importing large items from abroad.
A Word on UK Customs Charges for Imports from the EU
Before Brexit, UK consumers were free to buy items from anywhere in the EU without incurring import duties and other charges but this changed as of 1st Jan 2021.
EU orders now follow the same UK customs charges as any other country. So online orders up to £135 for EU goods should have VAT included in the point of sale price (as is the same with imports from any country). European sellers are now expected to have registered with HMRC to offer these goods inclusive of VAT. Though many EU sellers have decided it isn’t worth it and have stopped exporting to the UK as a result.
Some EU retailers have simply tried to carry on as before, though this has resulted in the postal service demanding the UK buyer pay the VAT owed on the item when they deliver the goods.
Final Word – Understanding Customs Charges in the UK
When importing goods to the UK it’s important to understand the UK customs charges and UK VAT that could be due on the item. In some instances, UK customs fees and VAT can increase the value of an item by up to 40%. Goods under the value of £135 should be free from both UK customs fees and UK VAT, though this is dependent on the exporter providing a price upon sale which is inclusive of VAT – be sure to check this when ordering an item.