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  1. Excise Duty
  2. Export VAT
  3. Exchange gain or loss
  4. Import duty
  5. Import VAT
  6. VAT

Customs Duty - What is Customs Duty?

Customs Duty is a charge on goods sent to the UK from outside of the European Union.

Does your business buy goods and services from abroad? Find out more about the different kinds of import duty you might come across.

Customs Duty applies to both individuals who make purchases for private use and businesses that buy goods for commercial use.

You may have pay Customs Duty on things you:

  • Buy online
  • Buy in another country then send to the UK
  • Are sent as a gift.

Customs Duty is not charged on personal items that are sent back to you from abroad; however, you must make sure they are described as ‘personal belongings’ when you complete a customs declaration.

You may also need to pay import VAT and Excise Duty on goods imported from outside of the EU. Neither Customs Duty or import VAT apply to imports from other EU countries.

How much is Customs Duty?

The amount you pay in Customs Duty depends on whether the item is considered a gift and how much the item is worth.

You can recieve any goods worth under £135 without paying Customs Duty. If you receive a gift valued between £135 and £630, you usually pay a rate of 2.5%. If you receive a gift worth more than £630 or anything else worth more than £135, you will need to contact HMRC to find out the specific rate.

How is Customs Duty calculated?

Customs Duty is calculated as a percentage of the goods’ total value, which includes both the price paid for the goods themselves and any costs incurred by postage, packing, and insurance.

Even if you paid for the goods in a foreign currency, Customs Duty will be charged in pounds. HMRC has extensive guidelines for currency conversion and Customs Duty, as well as specific rules that outline when you can use a fixed exchange rate.

How to pay Customs Duty

If you buy goods from outside of the EU, anything you import will have to go through customs checks. Once your goods are received by the relevant authorities, they will be checked to determine how much tax or duty you need to pay and whether the products are banned or restricted.

If you are liable for Customs Duty, you will be contacted by the delivery or courier service handling your goods to explain how to pay. You will not be able to receive your goods until you have paid the relevant duty and VAT.

As an individual, you must declare goods bought to the UK if they exceed your duty-free allowance or if they are banned or restricted. As a business, you must declare all goods that you bring into the UK to sell on to others.