A handling fee is a fee charged by a courier company for handling customs charges on your behalf.
Anyone who imports goods from abroad worth over £135 is liable for customs charges. Couriers like DHL or DPD pay these charges on behalf of UK shoppers to release the goods from customs.
For this service, they charge a handling fee. Once import charges and a handling fee are paid back to the courier company, the goods are delivered.
The rate of handling fee depends on the courier company. Some companies charge a fixed amount, while others charge either a fixed amount or 2.5% of import duty and VAT.
Customs charges on returned goods are refundable. However, the handling fee is not since it isn’t charged by HMRC but by the courier for their services.