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Import Question for my International guys


Mrs. tk4205

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It has come to my attention that the UK has no trade agreement with the US and imposes an import tax on our gaskets, pauldrons and everything else we send there.  We don't have anything like that here in the US how does this work?  I did learn that the first 135. pounds or $162 US is duty free.  Do they subtract that amount from the total value if it is more than $162.  US? 

 

Thanks!!!

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Approximately its this:

All goods that arrive from a NON EU country are liable for VAT if they are worth more than £15, and duty if they are over £135.  The value of the goods is the value of the goods inclusive of shipping and duty.  The value is also converted into £ sterling using what ever the rate that they are using, I don't know how they calculate this, before the VAT and Duty are calculated.

 

Some stuff will be missed, assume it won't be from the US.  Also best not to falsify the customs declaration.

 

VAT is currently a flat 20%*.  Duty is a scale, but I believe once you cross a threshold the rate applies the whole whole value.

 

There will often then be a handling fee by the delivery company, usually £10 but I've seen as much as £20.

 

Worked example using made up numbers:
Goods = $200
Shipping to the UK = $30

Total = $230

 

At customs this will be converted to £

Value = £169.88 ($230 based on todays rate on xe.com)

Duty = £4.25 (2.5% of the total in £, if the value was under £135 it would be 0%)

VAT = £34.83 (value + duty @ 20%)

Handling Fee = £10

 

Total = £218.96

 

The government page on this is: https://www.gov.uk/goods-sent-from-abroad

 

Hope this is helpful, I'm not super experienced in this but I've ordered enough stuff to have a reasonable grasp of the law here.

 

* There are other rates but they won't apply here.

Edited by themaninthesuitcase
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8 hours ago, themaninthesuitcase said:

Some stuff will be missed, assume it won't be from the US.

What do you mean by this?  Thank you for the information it is super helpful!  I am able to apply your example to our prices and I actually understand  it.  :)  I have read some of the government websites and I didn't quite grasp the concepts.  Also, they don't answer the questions I am afraid to ask, for example, how do we save money and save our customers from having to pay outrageous duties. 

Edited by Mrs. tk4205
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What do you mean by this?

Not all packages will be stopped at customs and have VAT and Duty levied. Though these days this is getting rare from the US as everything is done digitally and so it’s done automatically.

Last time I got a package from the USA Royal Mail held the package until I went and paid the VAT and duty. The time before that was a bigger package and FedEx just invoiced me 2 weeks after the delivery.

Stuff from other countries, say China, often isn’t picked up for charging.
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Another question for you.  Say someone orders a set of rubber gaskets $300/221.23, and  a pauldron $150/110.51.  I understand that shipped individually,  The rubber gaskets will be charged VAT and Duties.  The pauldron will be charged VAT but not Duties.  My question is, If we put them both in the same box to save on shipping charges are they still assessed indvidually as they are listed on the customs form or are they added together for the total value of the contents and then the VAT and Duties levied? 

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Got it!  So what I am understanding is now we can probably assume that almost all packages from the US valued at over 135 pounds Stirling will be charged VAT and Duties. 

Not quite.

Anything over £15 get charged 20% VAT

Anything over £135 gets charged 2.5% duty and then another 20% on the resulting total VAT.

Both calculated agains the cost of goods and shipping.
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Another question for you.  Say someone orders a set of rubber gaskets $300/221.23, and  a pauldron $150/110.51.  I understand that shipped individually,  The rubber gaskets will be charged VAT and Duties.  The pauldron will be charged VAT but not Duties.  My question is, If we put them both in the same box to save on shipping charges are they still assessed indvidually as they are listed on the customs form or are they added together for the total value of the contents and then the VAT and Duties levied? 

I believe it would be based on the shipment total, the duty would be less than the cost of 2 shipping costs though.
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