Import VAT on Parcels – Goods sold to UK customers

In the event that the UK leaves the EU without a deal – non-UK based Businesses that sell to UK customers with parcel contents of less than £135 or less, will be required to pay import VAT.

For the purposes of this legislation, parcels include letters, packages, packets and any other article that could be sent by post, even if they are sent by different methods.

To pay the import VAT, affected businesses can choose to either:

• register with HMRC to report and pay the import VAT due; or
• pay a parcel operator (carrier) which offers a service to pay VAT to HMRC on the seller’s behalf.

Overseas businesses have been able to register for this service since February 2019.

The following businesses could potentially be affected:

• businesses based outside the UK, within the EU, outside of the EU and the Channel Islands;
• businesses that intend to sell goods worth £135 or less (excluding shipping, insurance and other incidental costs) to UK buyers after the UK leaves the EU; and
• businesses that choose to pay import VAT directly and not through the parcel operator.

If you wish to know more about Import VAT, please get in touch