The amount of import duty you pay depends on the value and type of goods being imported, as each product has a different rate of duty. To calculate the percentage of fees payable, you can ask your UK carrier or calculate it yourself using the online tariff on the UK government website. A lot depends on how the goods are classified and described, so you need a detailed description of the product and need to take the time to assign them to the correct tariff line. Failure to do so properly can result in costly fines and penalties. These tariff codes are often referred to as HS codes. An anti-dumping duty is imposed on imports that are “dumped” into the UK and elsewhere in the EU. “Dumping” occurs when foreign exporters sell goods abroad at a price below their local market price. They can do this to deplete stocks more quickly through exports, but can have a devastating impact on the importing country`s domestic markets if left unchecked. It is not so easy to tell customs that the goods are a sample. Customs sets the requirements for those who import “product samples” and can seize the goods if they are not met. When importing samples or smaller shipments through the post office or a courier company, it is no different. Since you`ve probably paid the shipping costs in advance, you only have to pay customs duties and VAT.
The company, be it Royal Mail, Parcelforce, FedEx, etc., will contact you to tell you how to pay import duties and VAT on your shipment. They usually wait about three weeks until you have paid the fee, after which they can return the goods to the shipper. VAT on an import from outside the EU is not only levied on the purchase cost of the goods. You pay VAT on all costs to buy them and bring them to the UK. Responsibility for compliance with customs import obligations rests with the registered importer. Incoterms – international trade terms used for the cross-border movement of goods – define the obligations of the seller and the buyer, including the party responsible for the importation. From 1 January 2021, the same rules will apply to buying items online in the UK as if you order goods outside the European Union, such as the US or China. This means that HMRC is trying to make VAT a level playing field. If you buy a taxable product at the store at the end of your street, you will have to pay VAT on the retail price. However, this price includes all the costs to put this product on the shelf. Therefore, import VAT is not as simple as paying VAT on the price of your foreign supplier.
The UK currently applies the EU`s GSP (Generalised System of Preferences), which means that goods from certain countries are subject to lower import duties. In some cases, they may even be completely duty-free. The programme is designed to encourage business between the UK and developing countries, such as: preferential tariffs are the result of international trade agreements. However, there are strict rules that you must follow in order to benefit from these rates. In reality, the above principle is correct, but the way it is elaborated is slightly different. Indeed, two companies that import identical products purchased for the same amount will have to pay the same customs and VAT rates. It would not be fair for one company to be in the Scottish Highlands and another next to the port of Felixstowe or Southampton. The company near the port of arrival can pay £200 less for the delivery of a shipment than the Highland company.
That would mean a £40 difference in the VAT they paid. HMRC has already thought about it! If you only buy goods for sampling purposes and don`t want to sell them, you can save on import duties and VAT. To qualify, there are a few criteria that the goods must meet: in this example, the sum of UK duty and VAT payable to import these goods into the UK is £192.5 + £1138.5, which is equivalent to £1331. If you buy products outside the EU, your supplier will not ask you to pay VAT on the products. Before you jump up and down excitedly, this isn`t the flaw you`ve been waiting for to get one on HMRC! If you have to pay VAT when you buy the same products in the UK, you also have to pay them when you import, but it`s a bit more complicated than that. Goods transported within the EU are not subject to VAT as in a single market. HMRC has more information about VAT within the EU, but the only VAT a shipping company charges when importing products from the EU is VAT on the transport itself. Your goods may benefit from a preferential import duty rate. For example, around 90% of goods arriving in the UK from the EU are duty-free, although some of them may be subject to VAT. UK import tax depends on a number of factors, including the type of item being sent, value, country of origin and intended use (personal or commercial). If you are importing goods into the UK from China, India, the US or anywhere else outside the EU, you will need a customs code to declare the products to UK customs. If you import your goods into the UK, the company handling your cargo will usually contact you to tell you how much you have to pay.
Most will send you a bill and all you have to do is pay it so it won`t be complicated at all. All you have to do is appoint a freight agent before the shipment arrives, and then UK Customs will automatically contact them on arrival.