Customs Duty, also known as import duty, is a type of tax charged on items brought into the UK from abroad. Often, these items are much cheaper outside of the UK, so the duty is there to protect the UK economy against foreign competition. In this article, we’ll take a closer look at what import duty is and what you can expect to pay.
What are the types of duty?
There are several types of duty that may be applied to items purchased in the EU.
These include:
- Basic Customs Duty (BCD)
- Countervailing Duty (CVD)
- Additional Custom Duty or Special CVD
- Protective Duty
- Anti-dumping Duty
How much is customs duty?
The amount of import duty that’s charged depends on the type of item that’s being imported and the value. The UK duty tax rate can be as high as 20%, so it’s important to factor this in when you consider buying items from another country.
The amount you’ll pay in customs duties depends on whether the item is considered a gift and how much it’s worth.
For example, if your purchase is:
- Less than £135 you don’t have to pay duty (known as non-excise goods)
- Between £135 and £630, you will be charged a 2.5% duty (it can be lower for some items)
- Greater than £630, you will need to contact HMRC for the exact UK duty rates
Bear in mind that there may be other delivery costs too, such as the £8 Royal Mail “fee to pay”.
Personal items and customs declaration
The good news is that import duty isn’t charged on personal items sent back to you from abroad. But, make sure they’re described as ‘personal belongings’ when completing your customs declaration.
How is customs duty calculated?
The amount of import tax that needs to be paid depends on the value of the item being shipped, as well as its type and destination. Usually, this is calculated as a duty percentage of the value of the item, and it must be paid in addition to any other taxes or fees that may apply.
How do you pay customs duty?
There’s a few ways to pay customs duties. One option is to use a postal service that offers customs clearance services. This option can be expensive, and it may take a while for the package to be cleared through UK customs. A quicker and cheaper option is to use a courier or freight company that offers customs clearance services.
Another option is to use a customs broker to pay duties on your behalf. Import brokers are familiar with international trade agreements and can help you with all aspects of importing goods into the UK. This usually includes everything from arranging customs clearance, figuring out if you need to pay VAT and paying any applicable customs charges.
Just be aware that brokers typically charge for their services, but it can be worth it if you don’t have the time or knowledge to deal with import procedures yourself.
What’s the difference between a tax and a duty?
A tax and a duty are types of taxes, but they are different. A tax is a fee collection against income, goods, or services. An import duty is specifically for imported goods and can vary, depending on where you are importing from.
What’s the difference between an import tariff and a duty?
There is a distinction between import tariffs and duties. Import tariffs are a type of tax that is charged on goods that are brought into a country from another country. On the other hand, duties are taxes charged on specific items, such as alcohol or tobacco.
As we covered earlier, duty rates can vary depending on what you’re importing, but a duty is still imposed for most goods. A tariff might be an additional charge placed on select items entering the UK to discourage their importation.
What’s the difference between import duty and excise duty?
Import duty is charged on items brought into the country, while excise duty is charged on items made in the country. The main difference between the two taxes is that import duty is charged on all items that are brought into the country, while excise duty is only charged on certain items.
The four main types of products covered by excise duty are:
- Alcohol such as beers, wine, cider, and spirits
- Tobacco such as cigarettes, cigars, rolling tobacco, and chewing tobacco
- Gambling such as the National Lottery, bingo, and both online or machine games
- Hydrocarbon fuels such as light fuels, biofuels, road fuels, and heavy fuels
What is import VAT?
Import VAT (value-added tax) is a tax that is charged on goods that are brought into the EU from outside of the EU. The tax is charged at the point of entry into the EU and is based on the value of the goods. The rate of import VAT varies depending on the type of goods being imported, and it can be as high as 25%.
What’s import duty recovery?
Import duty recovery is how a company can recover the import duty paid on goods later exported from the European Union (EU). This is known as drawback. To be eligible for drawback, the goods must be exported within a certain time frame and must meet other requirements.
What’s a countervailing duty?
A countervailing duty (CVD) is an import tax that is imposed on imported goods as a way to offset the effects of subsidies received by the exporting country. Basically, the purpose of a CVD is to create a level playing field for domestic producers, who may be at a disadvantage because of the subsidies.
What’s anti-dumping duty?
Anti-dumping duties are a form of import duty levied on goods being exported to a country at a lower price than the normal value of the goods. The purpose of anti-dumping duties is to prevent companies from selling their goods at unfairly low prices to gain an advantage over their competitors.
Reclaiming import duties
If you’ve made a purchase from an EU retailer in the last 365 days, you may be eligible for a refund on the import duty and VAT. We can help you get your refund quickly and easily. Simply fill out our online form, and we’ll take care of the rest.
We’ve successfully completed hundreds of claims. Our average refund is £250. Our experts will handle everything on your behalf and make the whole thing hassle-free.
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