Buy America! Does import duty stop you from shopping online?

Money in hands

Ever spotted your dream product cheaper online from a US company, but hesitated to buy because of concerns it may get stuck in customs? Or worse, have you bought from the US and incurred unexpected costs?

Friends have told me that they’ve recently been tripped up by import duty after buying goods online from US companies. The charges can be even more irritating when you compare the customs limit for buying online from the US (£135) to the limit for when you fly home with goods from the States (£390).

The question is – have you also been affected and would you like to see the UK government act?

A few years ago my husband, who is an amateur musician, spotted a synthesiser from a small American seller on eBay. Three weeks after ordering it he received a note from customs asking for additional money to cover the duty plus the VAT, which he hadn’t realised wasn’t pre-paid with his order. This nearly doubled the cost of the synth so he never reclaimed it. He also never bought online from America again.

Customs delays and charges

A colleague, Alex, spotted a picture of high heel shoe protectors for her wedding guests on Pinterest and the link took her to a US website. They were just what she was after and appeared better value than the UK equivalents she found online.

After a couple of weeks the heel protectors hadn’t arrived, so she contacted the US company who said the parcel may have got stuck in customs (annoying that they didn’t mention this at point of purchase!). Sure enough, the next day a card arrived from Royal Mail saying she needed to pay a £30 customs charge to receive her package. She had no choice but to pay the charge. It added about 20% onto the cost of the original items and meant they were now more expensive than the heel protectors she could have purchased in the UK.

Finally, Sam in our Campaigns team is a cheerleader with a UK squad. And while cheer has massively grown as a sport in the UK, the good stuff still mainly happens in the US. Lots of US teams have amazing merchandise for sale – the top team athletes are like celebrities, or “cheerlebrities” – but Sam’s held back from ordering anything due to fear of customs delays and charges.

Have you had a similar experience of customs when ordering online goods from American companies? If so, please share your stories. Do you think the UK Government should make it easier, simpler and cheaper to buy from the US?

Should the UK Government raise the import duty threshold so Brits can buy more from America?

Yes (72%, 925 Votes)

No (18%, 236 Votes)

Don't know (9%, 120 Votes)

Total Voters: 1,281

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Comments
Guest
Please kelly says:
24 August 2017

It’s outrageous…I buy my Stetsons from the states (you can’t buy a decent cowboy hat in UK) and the amount of import duty is nothing short of robbery
A friend of mine bought a steel resonator guitar … had to pay almost £350 before they’d let him have it
It’s a scam

Guest

Expensive, but a man’s gotta do what a man’s gotta do.

The Lone Ranger might sort it out but avoid the Loan Arranger.

Sorry.

Guest

Authentic Stetsons are very expensive in the States so the percentage import duty payable reflects that. The thing to do is go there to buy it and come back wearing it, together with the bandana, weskit ‘n’ chaps; breaks the ice at security.

When I was about eleven I had to make do with a Davy Crockett hat when I wanted a decent cowboy hat. It was British-made with simulated fur.

Guest

Import duty is often not very much, but you have to pay UK vat on the purchase price and the shipping costs, just as you would if you bought in the UK. You can check the rates with HMRC but I believe duty may be 2.7% and vat 20%.

Guest
Etaoin Shrdlu says:
25 August 2017

I very rarely buy from the United States because of the outrageous import duty. They even charge it when the item is a Gift, which they did not do until recently.

I just bought a car part for about $7.00 from the U.S., because the part is no longer available here in the U.K. I was charged 26.01 pounds by Customs, even though there was no declared amount on the parcel. I am about to complain to Customs about this, but they make it hard to find them. I found a complaint form, but it says that it is only for items that came through Royal Mail or Parcel Force. My parcel came through the notoriously bad U.P.S., but I will use the Customs form that I found. It will have to do.

Another major reason why I don’t buy much from the U.S. is that they did away with surface mail out of the U.S. about 10 years ago. Everything comes by airmail. This is ridiculous. Many items (especially large ones) are not urgent, and the four-week surface mail delivery time was not a problem. As an example, if you buy a used vinyl LP for, say, $10, the postage is about $21, which usually means that I don’t buy it.

Guest

… we have to have some common sense. If I’m buying from another country it is my responsibility to do my homework. Why should a shop in America be familiar with UK law and tax, particularly if they do not know where you are buying from until after the purchase.

That said it should be a lot easier to arrange for this in advance. Often the cost of the post office in dealing with the VAT etc… is more then the VAT and I am yet to find a way to ‘pay in advance’ to avoid this!

Guest
Jack says:
5 February 2018

Normally I’m OK ordering from the US because I buy from companies that are cleared to pay import VAT directly so the cost is up-front and there’s no hassle down the line. I did get caught out recently though buying some small decorative items (which I later found were going to be sold in the UK a few months later for a very similar base cost, oops!) which had a total carriage weight of 200g. The basic shipping charge was around £40, more than the value of the items I was buying and the carrier was licenced to pay VAT. So to my surprise a few weeks later I get an invoice for £4.52 import VAT and a £12 handling fee. The flat rate handling fee does make buying small items rather unattractive, especially when you have a case of paying through the nose at both ends for greatly inflated shipping costs (I had similar goods shipped for less than four dollars in the same week) and then the fees on delivery is a joke.

Guest
Izzy says:
5 March 2018

Hi sorry I dont know if you can help me or not but I figured it was worth a shot! Basically to sum up – I’m a business owner who does lots of importing and exporting in goods. Basically I’ve been having some trouble with foreign currency exchange and getting the best deals but obviously its really important for the business that we’re getting the best deal possible. I’ve been reading lots around the subject online but I’d be lying if I said I’d got my head around it. What’s the best option for businesses when it comes to foreign exchange? I came across a business called Clear Treasury and they seem to deal with this type of thing. Am I best going with a company like this rather than doing everything independently? Is that the recommended course of action? I just want to make sure I’m getting the best deal – so any advice would be massively appreciated! Like I said I don’t know if anyone will be able to help me but thought I’d give it a try! Thanks everyone!

[Hello your comment has been edited to remove a link which could be considered promotional content. Please ensure your comments are on-topic and aren’t promotional or spammy. Comments which break our community guidelines will be edited or removed. Thanks, mods]

Guest
Snookie says:
18 March 2018

I have been buying skin lotion on ebay from USA because I could no longer get it in UK. The latest parcel had a charge to pay which came to nearly the cost of the item. I have checked ebay again and the product is now available in the UK again. How annoying!

Guest
Hammock says:
31 March 2018

It seems I have just fell into the “highway robbery” trap of buying goods online from the good old U.S of A. I was tracking my order online only to find that my parcel is being held at a local depot pending charges of which I will supposedly be notified at some point. Going by previous posts I have read… it seems I will have to pay 20%VAT on the item(which cost me £56 including shipping costs) plus an additional £8 handling fee by the post office? So that works out at about £19.20 Ouch!! Like most people who have vented their frustration of being hit by an almost stealth like tax…I too am very angered by the lack of information warning potential customers of these hiked up charges you have to face if you want to claim your goods. I most certainly will NEVER buy from the USA again or anywhere that will incur these additional charges. I wonder if the Americans get stung in the same way if they buy goods from the UK online…just a thought. I am sure some clever person will know the answer.
Happy days shoppers 🙂

Guest

Hammock, do you think should you should not be charged vat, as you would if you’d bought in the UK?

Guest

Hammock , it WAS easier in the USA but not now , I have read the full -cbp.gov – US Customs and Border Protection -Rules & Regulations pretty strict now due to Donald “tightening up” imports + duty . $2000 limit on private imports over which YOU have to go to the dock and sign in person for it . Duty incurred and all sorts of import documents to pay by the IMPORTER not the seller. It just gets worse the more you read , liable to be opened by Border Control+ Customs any lack of paperwork it never leaves the dock and you are charged storage , after a while its auctioned off . They know all about Americans saying its worth a “buck ” while its really worth $500 . You want it cheap at wholesale prices ? try Price Japan for all sorts of electrical/hi-fi goods /etc . Many did on a top end US hi-fi website I am a member of.

Guest
Rachael Wright says:
24 April 2018

Despite you spending nearly a year repeating yourself on the issue of VAT needing to be charged Malcolm, I think what some of us are trying to say is that this tax charge is unclear and seems very often to be disproportionate. I am currently unemployed, Australian, and staying with friends in London and ordered a swimsuit from the USA. This is a family friend’s small start up business so I was trying to help them out and spent some money that I probably didn’t have to spare to buy said swimsuit. AT NO POINT during the transaction was there any notice of potential further charges and operating, perhaps naively, under the Australian shipping background that I have I happily paid my 48 quid and waited 3 weeks for my parcel to arrive. Instead today I have received a parcelforce notice for 25.47, which is more than half of the original purchase price and I’m not actually sure I can afford to pay that this week and have enough to pay rent.
What an absolute joke.

Guest

Last time I looked Rachael VAT in Australia was -10 % ,here its 20 % there can also be other duties to be paid unless the USA company pay at source for them.

Guest

I only “repeat myself” Rachael when the same question arises and the same answer seems appropriate. I only repeat what HMRC say about personal imports.This can be found on their website and seems quite clear. I do not know how your Parcelforce bill is calculated but it should state any duty, vat and their fee.

I’m sorry you feel aggrieved when an innocent bystander simply passes on information. But that is partly what these Convos are for.

Guest

Your right malcolm Parcelforce only charge what HMRC say is to be charged , Parcelforce dont value them themselves.

Guest
Holly Vernon says:
6 November 2018

What if you already paid sales tax in the usa. Do you then have you pay vat here too?

Guest

Yes. USA tax is nothing to do with the UK; it is for running the USA. VAT is taken to contribute to the UK’s running costs.

Guest
Joseph Priory says:
4 April 2018

It boils down to the fact that the UK government are thieves and robbers, have been for decades, and what idiot gave the Post office the contract to collect the money due to HMRC, that needs to be investigated and STOPPED!!

Guest

https://www.gov.uk/goods-sent-from-abroad/tax-and-duty explains the way this works. The Post Office is just one of a number of couriers charged with collecting and remitting tax and duty that is due on an overseas purchase.

It would seem quite fair to charge an importer of personal goods (above the minimum value) the same tax that you would pay on a similar UK purchase. It would also seem reasonable to pay the cost the courier incurs in remitting tax on your behalf to clear the goods for import. But note the EC says “Member States cannot impose charges related to customs clearance higher than the actual costs incurred.“.

This system is a requirement of the EC but I doubt it will be changed after Brexit. https://ec.europa.eu/taxation_customs/individuals/buying-goods-services-online-personal-use/buying-goods/buying-goods-online-coming-from-a-noneu-union-country_en

Guest
JimJam says:
16 October 2018

The problem is Malcom, is that sales tax has already been paid in the US. You are effectively charged sales tax twice. It would be make sense that UKCE claim what money is owed in VAT from what has already been paid to the US, with the difference to be made up by the recipient. In addition to this, the VAT is charged on the delivery cost, despite no delivery purchase ever being made within the UK jurisdiction. Triple whammy!

With regard to being charged a “service charge” by the courier, this is of course just robbery, the cost of delivery from door to door has already been paid by the sender. The “service” being offered in the handling of the good though customs and collection of payment, is a “service” to UKCE, the cost of which should be paid by UKCE.

You seem to be very keen on the consumer being shafted at every stage by governments/corporations. Bizarre!

Guest

I was not aware that the consumer was “being shafted at every stage”, JimJam. The costs of imported goods and the taxes and handling charges appear to me to be transparent. I cannot see that HMRC has any right to a portion of a state or city sales tax in lieu of full UK VAT. Its rules have to apply to all countries where all sorts of different tax regimes apply, not separately for the USA. At the end of the day it is up to the purchaser to decide whether buying something from outside the EU is worth it. The UK’s revenue and customs should not be at a disadvantage on account of people buying from abroad.

Guest
Mike Hunt says:
4 April 2018

Ebay are partly to blame, you used to be able to contact the seller and get them to make a false
low declaration about the value of the goods you were importing to avoid the tax but politically correct Ebay seem to make them join that useless global shipping program so the money can be stolen from you at the checkout!!!

Guest

Is smuggling ethical?

Guest

are taxes?

Guest

Pensioners think taxes are ethical, and those on benefits. People who can’t afford to educate their children privately think they’re a good thing and I guess most patients are in favour. Turning your question around, what parts of the UK’s taxation policies do you think are unethical and what would be the consequence of doing away with them? Obviously, incomes would be much lower if there were no taxes to pay and everyone had to stand on their own feet for every single thing.

Guest

The fee for admin charged by the delivery firms is disproportionate IMHO. The simpler way – and most up-front way from the purchasers’ perspective would be for the amount to be paid by the importer via whatever means and then passed on at retail time. I realise there are flaws but that to me would make it transparent to the purchaser.

Guest
Diane Ayres says:
6 June 2018

Just came across this thread as fuming at the astronomical bill I have just received on a couple of small items bought from the US. The items are not available in the UK or I would not have bought from abroad but I do not object to paying import duty and VAT on the items (though not happy, if they were available in this country I would have got them here. and think the charges are too high), what I object to most is the postage costs, which are already high, being added on the the items costs and duty being paid on all of it and of course the £8 handling fee from the PO. How is that justified?

Guest
outraged says:
2 July 2018

I have just been stung with a £17 bill inc the £8 handling charge whilst ordering specific supplements from the USA that were guaranteed quality and safety checked. Whilst they had something similar on amazon uk, I would not buy from there because of their unethical trading practices and unknown adulterated rubbish bought from china and rerouted and repackaged in counterfeit containers, and to avoid tax and charges to amazon and their sellers. so on an order for about £55 I spent an extra £17, so out of proportion and unfair! This practice will allow the likes of amazon to dominate tax free exponentially as it wipes out the competition. the post office lady said to me they used to have to charge for 1-2 parcels a month. She said in the last two weeks the numbers had increased to 125 plus a week! Considering the Government of our country is going to award citizenship for £65 per person, this in comparison seems ludicrous. The charges now are, anything over £15 in value will attract and £8 charge plus 20% VAT. Order over £135 and you get a further whammy of Customs Duty on top of the afore mentioned. Gifts from the USA, are slightly different in that £39 and over is the bottom line before massive taxes. So your relatives need to be aware of what their totals are to enable a fit with this stupid low figure.

Guest

You will pay vat on the product plus postage and packing wherever you buy from – the UK or overseas. Customs duty is usually very low. All these charges are clear if you visit HMRC.

If you want legitimate supplements then I would be surprised if Amazon is your only alternative. Have you tried High Street providers or pharmacies?

Guest
Sally Davies says:
29 July 2018

I ordered 1 bottle magnesium chloride from a US site last February – total cost (with shipping £2.72) £11.46. In June I re-ordered 2 bottles – total cost from retailer £27.80 (with shipping £10.13). To this has now been added £33.42 for duties and disbursements. The VAT is £11.42 on a product cost of £18.60 – more than 50%. Cost per bottle, over £30 (original price £9). What’s going on??

Guest

I can’t fully explain the charging other than to say the price of the product seems to have increased, it might have crossed a duty threshold, VAT is payable on shipping and handling charges, and there is an administration fee for remitting the VAT and duty to HMRC.

It occurs to me that it might be possible to buy this product from a UK or other European source considerably cheaper.

Guest

See https://www.gov.uk/goods-sent-from-abroad/tax-and-duty
Imports less than £15 are not liable for tax or duty, and thus no remittance charges. Your first purchase met these requirements.

Goods imported from outside the EU with a value (including shipping) of over £15 are chargeable for VAT. No duty is payable if less than £135.

You say you paid £11.42 VAT, which implies that the cost of the goods, shipping and handling charge was £57.10, and a total of £68.52. A handling charge is for the courier to recover the tax charge and remit it to HMRC.

I’d have a good look at the bill to check the seller’s declared value, and the separate cost added for tax and remitting. There is a form online to reclaim an overcharge.

Guest
Sally Davies says:
1 August 2018

Unfortunately, it was not possible to buy the particular supplement I wanted from the UK. Apart from anything else, the shipper (DHL) appears to have charged me double VAT – £11.46 on a total of £28.56 + £22 disbursement. On looking back on the iHerb website I find that shipping information is included, as one of 13 drop down options! There should be a specific notice on the order page. Caveat emptor!

I have spoken to DHL today and it appears that since the item wasn’t delivered (I rejected it*) there is no charge and the agent I spoke to is raising a dispute on my behalf. *This may be valid under the distance selling regs. Anyway, watch this space.

Guest

Like many people I would like to buy things from America and not pay these ridiculous costs. I’m hoping that once we leave the EU and get a trade deal with the USA then these charges will be dropped. I’m not holding my breath though.

Guest

That’s a potentially good outcome of Brexit, Jon. It would no doubt be counterbalanced by tariffs on everything we buy from the EU and for many people that could exceed their American spending.

Guest

Jon, the major extra cost in buying from outside the EU is vat, which if you bought in the UK would have to be paid anyway. Duty is usually minimal. The normal handling charge is around £8 for the work involved in collecting and remitting vat to HMRC. That is unlikely to change.

Guest

Taxation is theft.

Guest
DerekP says:
4 November 2018

All property is theft.

Guest

La propriété, c’est le vol ! Anarchists of the world unite. You ‘ave nothing to lose but your disorder…

Guest
DerekP says:
4 November 2018

…and pyromaniacs of the world: Ignite!

Guest

Taxation is not theft if you voluntarily enter into a transaction in which tax is levied.

Guest

Where else should the money come from to finance those things society needs?

Guest

I’d love to know why I just got slammed for import and VAT from Canada. I guess CETA was only applicable to business importers and exporters. Canada and the EU claim that 98% of all taxes have been eliminated through CETA; just not Import Duty, VAT, and the outrageous “Brokerage” charges that Royal Mail, UPS, and Fedex apply for doing their dang job and passing a parcel through the customs process, obviously.

Guest

Duty applies depending on the goods and their value. VAT is normal and buying from abroad does not exempt the purchase from the tax. The companies that ship your goods have to process them through Customs and make the payments required by HMRC; there is a cost to that but whether the charge to customers is fair and reasonable is a good question. Obviously, with a flat rate handling charge it can be a high proportion of a low value transaction.