What are Duties and Taxes?

When transporting goods across international borders, shipments are subject to duties and taxes as determined by customs in the destination country based on value, origin and commodity type.

Shipper’s Guide to Duties and Taxes

When shipping internationally it is important to understand duties and taxes and that these may apply to your shipment.
All types of shipments (including gifts, samples and goods for repair) go through an import clearance process as determined by custom’s regulations in the destination country. The shipment is cleared through customs based on the type of goods, origin country, the value and quantity. Dutiable shipments are subject to a customs duty, which is a tariff or tax imposed on goods when transported across international borders.
The calculation of duties depends, in most countries, on the assessable value of a dutiable shipment. For the purpose of this calculation, dutiable goods are given a classification code that is known as the Harmonized System code, which determines the applicable duty rate.  This system is a multipurpose international product nomenclature developed by the World Customs Organization and continues to evolve.
The payment of duties, taxes and other fiscal charges are typically the responsibility of the receiver, although DHL Express does offer the opportunity for DHL account holders to pay for them.
In that case, after shipment delivery, DHL invoices customers for the duties and taxes we paid on their behalf at destination, plus a small administrative fee.
Taxes are imposed on goods when they are moved across a political boundary, although some free trade zones exist around the world (for example, the European Union). Taxes are usually associated with protectionism, the economic policy of restraining trade between nations.
Taxes are usually imposed on imported goods, although at times may also be imposed on exported goods.

Receiver’s Guide to Duties and Taxes

Did you receive a package and need to understand your obligations to pay duties and taxes?
All goods imported into the UK must be declared to the UK customs authority, HM Revenue & Customs (HMRC), and in most cases are subject to Customs Duty and VAT. This includes goods purchased online. Certain goods are also subject to Excise Duty.

The person receiving the shipment is legally obliged to pay Duty and VAT unless the sender has agreed to accept these charges in the contract of sale.

Learn your responsibilities! HMRC advice for goods sent from abroad

Please refer to hmrc.gov.co.uk for information and up-to-date guidance.

You may be charged customs duties and taxes for products purchased online because:
  • Duties and taxes may not be included in the price of the goods you purchase online, and therefore might not be included in the overall shipping costs you pay to the online retailer. Check retailers’ websites as to whether purchase prices already included duties and taxes.
  • When purchasing goods online, some or all of these goods may not originate in the country you reside in, therefore are subject to a customs duty and/or taxes, which is a tariff or tax imposed on goods when transported across international borders.
  • When goods are not shipped domestically (within your country) or within a single customs union, such as the European Union, you are liable to pay any inbound duties, taxes and other fiscal charges which your local customs authority deems appropriate and as mandated within the legislative framework in the country of import.
  • To ensure the DHL courier can deliver your goods in shortest possible time after entering your country or customs union, DHL pays the customs authority on your behalf for any duties and taxes that are due on the goods (and charges you).
  • DHL will typically notify you about payment of duties and taxes (to DHL), such as send a link to pay online. Prompt online payment ensures the smooth delivery of your shipment.
  • What is payable, if anything, depends on where the goods are sent from, the type of goods, their transactional value and the weight of the package, and other costs that the customs authority determines must be added to the value of your shipment for such calculations.

When buying goods online, you should always check whether they are either being sent to you from the UK or another country.

Note: Different rules apply when buying goods for commercial use.

A gift is defined as something sent directly by one private individual to another and such goods do not attract import tax if the value is below stated local thresholds. The threshold in the UK is £39. Customs Duty also becomes payable if the value of the goods is over £135.
Ordering and paying for goods that originate outside of your country or customs territory for shipping to a person other than the purchaser, does not meet the customs definition of being a gift.

These charges are not included in our tariff because the Customs authorities in the destination country determine whether any duties and taxes are applicable when the shipment arrives.

When DHL pays Duty and VAT on your behalf, an Advance Payment or Disbursement charge will be added to your Duty and VAT statement/invoice for clearing the shipment through customs.

The charge is currently £11.00 or 2.5% of the total Duty and/or VAT incurred, whichever is the greater.

If the total Duty and/or VAT incurred is less than £440 then a flat amount of £11.00 will be incurred as this is less than 2.5%

For example, if the total Duty and/or VAT amount equals £125.80, then £11.00 will apply.

The 2.5% will be incurred if the total Duty and/or VAT is greater than £440.00. For example, if the total Duty and/or VAT amount equals £490.00 then an amount of 2.5% will apply i.e. £12.25.

If you are a regular importer, you can apply to HMRC for a duty deferment account for the payment of most customs charges, such as import VAT, customs duty and excise duty. A duty deferment account lets you make one monthly payment via Direct Debit instead of paying for individual shipments.

Yes, they include:
Gifts from one private individual to another providing the value does not exceed £39. Exception: There is a very restricted gift allowance on excise goods, but we advise you to contact HMRC for further information.
Excise goods include products such as: alcohol, tobacco products, perfume, eau de toilette or cologne.
Personal effects of people returning to the UK after residing abroad.
Goods found to be defective or damaged or not otherwise as ordered. Customs must be notified before qualifying goods can be returned overseas, otherwise duty relief may be lost.
Goods imported into the UK for processing and repair before re-export from the UK. Your local Customs office can provide you with further details.
Note: Any goods arriving in the UK on which Excise Duty in particular has not been paid will be liable to seizure by Customs.

Customs assess the amount of Duty to be paid based on the information provided on the DHL Waybill and customs paperwork, in particular where the goods where sent from, the type of contents, their value and the weight of the package.

The value for VAT is the declared value of the goods plus the transport costs to the country of destination plus the Customs Duty.

Example of Duty calculation
Value of goods £80 + transport to the UK £35 = £115
Total value for Duty £115 x 3.5% Duty = Total Duty payable £4.02

Example of VAT calculation
Value of goods £80 + transport to the UK £35 + Duty charges £4.02 = £119.02
Total value for VAT £119.02 x 20% = Total VAT payable £23.80

Total import Duty and VAT charges payable on import of these goods = £27.82

For more information and advice about Duty and VAT, contact your local Customs office, visit hmrc.gov.uk or call HMRC directly on 0300 200 3700.

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