Do you want to avoid customs charges from the USA to the UK?
When you are travelling from the United States to the United Kingdom, travellers may be subject to customs charges.
Customs charges are taxes collected by the customs authority of a country on goods imported into that country. They are based on the value of the goods being imported and can be a substantial expense for travellers.
This article is helpful to those who are interested in avoiding customs charges from the USA to the UK.
The customs authority of the United Kingdom may impose a customs duty, which is a tax on the value of the goods being imported.
Customs duty is assessed on a sliding scale, based on the value of the goods being imported. The duty rates are set by the British government and may change from time to time.
In customs duty, the officials inspect the goods and check if they require any tax, then they hold it over until three weeks before the receiver pays the taxes.
If you are not familiar with these taxes, you will owe a hefty amount to the customs you have to pay or lose your goods.
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Let’s know more about how to avoid customs charges from the USA to the UK.
Do I have to pay customs for a package from the US to the UK?
There is no definitive answer to this question as it will depend on several factors, including the weight and value of the package, the destination country’s customs rules and regulations, and the shipping company’s policies.
However, generally speaking, if the package weighs less than 2kg and is being shipped within the European Union, the recipient will not have to pay customs fees.
What are the risks of avoiding customs charges UK?
When you are receiving many parcels from the USA or just one, it can be tempting to provide false information on the pro forma invoice. However, in doing so you could arouse suspicion about the contents and value of your parcel. Stringent checks are carried out at every cross-border customs facility.
If your information is flagged as being inaccurate or anything about your parcel warrants a further investigation, you could experience delays, a penalty fine of at least ₤ 250, and/or your parcel being returned to you. In more serious cases, your parcel could be destroyed.
The recipient could also face further customs charges if the item is delivered, and this is something that could put you out of favour with your customers if they have to pay an additional and unexpected customs fee.
It is important when packaging goods that you are both honest when completing customs documentation and that you check the customs information for each country as jurisdiction can differ quite significantly from country to country.
What do the European – UK customs charge you for?
Before discussing the tricks of avoiding customs, you need to know what these charges are. So, it is better to go over some ground rules before diving too deep into this sea.
The United Kingdom government website does an excellent job defining the whole system of import tax from the USA and how they inspect incoming reports. Once the customs receives the goods, the first job is to make sure they are not restricted or banned in the continent.
Once the customs define the box as not banned, they try to find what kind of tax they are subject to.
This tax decision depends on the type of good and a product or a gift. The three types of taxes are VAT, customs duty tax, and exercise duty tax. You may not be very familiar with these terms so we will go in-depth with them.
VAT
The first tax that you will come across when someone sends you a UK gift is the VAT, which stands for Value Added Taxes. VAT are general taxes that apply to the best services that come and sell in the UK.
It can also be used on already-bought products and gifts you receive from countries that are not a part of the European Union. It is very similar to sales taxes which apply all around the US for most goods.
VAT follows a standard rate chart for certain goods, but there exist things that require special taxes. Some products can be subject to a rate, meaning they are not subject to any surcharges.
For now, the standard VAT rate is running at twenty per cent for most goods, and some products have a five per cent reduction in that amount.
You can also find a list of goods that require special taxes on the official UK government website and Avoid Customs Charges From the USA to the UK.
Customs duty
The following tax, which you will have to pay when you ship your products to the UK, is the customs charges from the USA to the UK.
As for VAT, the UK is not the only continent that collects this tax on goods from countries not a part of the European Union. Countries charge this tax to ensure that other countries’ goods flow efficiently and don’t affect their economies.
When customs receive a package, they can decide if they are subject to business by weighing its value. The value of customs is the cost of the product and how much does its insurance cost?
If the product has a value under 150 dollars, you will not have to pay a customs duty charge. If the value lies between 150 and 695 dollars, the box will be subject to a 2.5 per cent of customs duty charge.
If your product’s value goes higher than 695 dollars, the cost will depend upon the type of good. You can study more about those charges on the UK customs website.
Exercise duty
The last type of UK import charges from the US applies only to some alcohol and tobacco products. These taxes are specific to every particular kind of tobacco and spirit. The information about all of those products is on the UK customs website.
Who pays the customs taxes?
If you are shipping something to someone you know in the UK, the receiver will have to pay customs before receiving the package after the inspection is over. You must try keeping the taxes minimal and try not owing them all together.
You don’t want to barrage the receiver with a huge bill to receive your parcel.
How to lower customs costs?
A few ways exist to take advantage of the rules and navigate them to avoid paying customs fees.
Reviewing the VAT rate list
The best way to reduce import duties from the USA on gifts you ship to the UK is to purchase and send goods that are not subject to a lot of tax. The UK government provides an informational list that shows products and their VAT rates.
You have to pay attention to these VAT rates to reduce taxes to as low as possible.
There are a few goods that require zero taxes, and they can become an easy gift option for anyone living in the UK. These goods are-
- Books
- Children’s toys
- Antiques
- Maps
- Music
- Keeping the costs down
If you wonder how much money they charge for goods above 695 dollars, the cost plus the shipping taxes to the part of the UK. If your package’s total cost is below 135 euros, the customs will not get involved with it.
So it would be best if you tried staying under 148 dollars while purchasing your gift to avoid paying for extra shipping taxes on the present, including the customs duty. If you have many items that can increase your shipping costs if you ship them together, then break them up and send them individually.
You should also pay attention to the weight of your parcel and try choosing the lightest gifts possible.
Let the online store directly send over the gift
The last method of minimizing your custom costs is to know how the UK government defines gifts. According to them, a gift is something brought and sent between two individuals. These rules do not apply to a product that comes from a company. So if you buy a good from a store and let them ship it to someone in the UK, it will not come in the tax books of import duty from the USA.
How can I import from the USA to the UK by Avoiding Customs Charges in 2024?
There are several reasons why importing from the USA to the UK might be right for your business. The United States is one of the largest trading partners of the United Kingdom, with many goods moving between countries every month.
In fact, in 2017, exports from the United States worth $56.3 billion came to the UK. Some parts of the region account for 3.5% of all exports out of the United States. With the help of this article, you will know about the import from the USA to the UK.
How to calculate import duty and taxes from the USA to the UK?
When importing from the US to the UK, You will be required to import duty from the USA to the UK on your items. What you owe will depend on the type of product you import.
Many importers need freight forwarders or customs brokers to help calculate import costs to get actual import charges from the USA to the UK.
There are a lot of online free custom charge calculators to calculate the charges you have to pay for accepting the goods you imported from outside of the UK.
USA import tax: us to UK import tax
The tax payable will vary depending on the goods you bring into the UK. To know the tax rate, you will need to obtain a product code for your product. You can find it on the UK government website. It has a search engine to help you choose the right code.
When you declare your goods to UK customs, you will be asked to verify the product code, which will be used to calculate the duty to be paid; the amount varies quite a lot.
The tax is set at 12 per cent. Some new cars are taxed at 10 per cent, while some appliances may be taxed at zero.
Your goods will be held at UK customs pending payment of duties and VAT. Once the payment is received or by the freight forwarder or customs broker on your behalf, they are released. You can avoid customs charges from us to the UK by following the process we’ve mentioned before.
Paying VAT on products from the United States:
You will be required to pay VAT on UK-imported goods. It is important to remember that VAT is calculated based on the cost of goods + shipping + tax paid and is charged at the current UK rate of 20 per cent.
If you are shopping from a supplier in the US, especially for imports to the UK, you should not pay US VAT. The VAT is charged when imported into the UK. However, if your supplier adds VAT to your US invoice, it can be challenging to get back once the payment has been made.
What are the requirements for importing from the United States?
If you are planning importing goods into the UK there are a few things you need to prepare in advance. They are given by,
- Product code – It can be used by customs authorities to identify goods you bring into the country. To ensure correct taxes and duties are paid and comply with all legal and safety regulations.
- Import License – Many types of goods require an import license. You will need it if you are importing dangerous items or can be used for military purposes and usually if your product contains live animals or plants.
- EORI (Economic Operators Registration and Identification) Number – Importing is required for individuals or businesses importing to the UK. You can get an EORI number in just a few days by registering online with a UK tax authority.
- Customs Declaration – If you are using a customs broker or freight forwarder, you may find that they perform some or all of the customs procedures on your behalf. You will use a form known as C88 or SAD – a single administrative document.
The best way to pay for items from the USA:
Importing goods and services from us to UK customs fee can be costly. Some of the expenses are unavoidable. But others can be avoided if you do a bit of research.
Besides this many banks will provide the best way to pay offshore invoices, finding another service can be up to eight times cheaper. Traditional banks may charge higher fees even though they advertise low costs. But it can add a difference to the exchange rate to make the transfer more expensive for you.
Each time you use it to make international money transfers; they will give you the real exchange rate in the central market. This is the rate you will find on Google. All you have to pay is a small fee and transparency. The service is regulated by the FCA and has more than 3 million customers.
Additionally, if you trade currencies regularly, a borderless multi-currency account can save you even more. It allows you to store cash in more than 40 different currencies.
So you can get funds to your account with no receiving fees and switch between different currencies immediately to pay invoices.
Which freight is better, air or sea, from the USA to the UK?
Air or sea freight will be your best choice, largely depending on what you are shipping and when your requirements.
In general, sea freight is a much cheaper alternative for bulk goods such as clothing or consumer goods. But this mode of transportation takes time to reach you.
But the air transport is much faster, but it is associated the costs are high. It is a better option for smaller loads that are less than 100 kg, high-value products, or urgently needed items. For emergencies, you can use air freight to import from the USA to the UK.
How will you import from the USA to the UK?
There are some basic steps you need to take to ensure your cargo reaches the UK smoothly. In many cases, importers choose to have their freight forwarders or customs brokers assist in these processes.
There may you will need to pay the fee for this service. But it can also give you peace of mind and help you avoid any nasty delays or surprises.
Some of the essential aspects you need to provide at the end of your UK import. They are given by,
- You can receive an EORI number which will take three business days to arrive.
- Find the correct product code for your product.
- Check if you need an import license for your goods.
- Report your import to UK customs or let your freight forwarder or customs broker do this for you.
- You can pay the duties and VAT to have your goods issued by customs officials.
What are the popular items imported from the USA to the UK?
The United States of America is the largest export market from the United Kingdom. Nearly 15 per cent of all exports from the UK go outside the US. The United States is the 4th most significant source of imports for the United Kingdom after Germany, China, and the Netherlands.
Some of the popular items imported from the USA to the UK are given by,
- civil aircraft
- Chemicals and basic resources used in production
- electronic equipment
- drug
What is the step-by-step process for importing from the USA to the UK?
Get an EORI number:
To import to the UK, you need an EORI number. You can apply for an EORI number online. If you already have an EORI number, make sure it’s a new one that starts with GB.
Find the commodity code of your commodity:
You will need the product codes of the products you wish to import into the UK.
Calculate the customs value of your goods:
When you ship from the USA to the UK, you must declare the value of your goods to the HMRC. This value is the basis for determining the number of customs and VAT on imports you must pay for importing into the UK. It is also necessary for trade statistics.
Find out if you need an import license or certificate:
You may need an import license or certification to import certain goods into the UK, such as plant or animal products, or regulated goods such as drugs, chemicals, or weapons. You must apply for an import permit and obtain other required documents or certificates before importing into the UK.
Learn about the changes in import VAT:
For businesses that import goods from the USA to the UK, import duties usually are charged when the goods enter the UK.
Select the customs procedure code that applies to your import:
Customs Procedure Codes (CPCs) identify the customs and excise system where goods are fed into and removed from (if applicable). You will need to select the correct CPC for your goods before completing the import declaration.
Access to the Government Customs System (CHIEF):
An import declaration to the HMRC must be submitted electronically. Your company must access the government’s customs system to contact HMRC to import into the UK.
FAQ-
Who pays customs fees, the buyer or the seller?
In most cases, the buyer/ importer is held responsible for paying import taxes as this is the least costly for the customs administration. Indeed the importer is the one who the tax administration better knows since she/he has a tax identification number in the destination country.
Do I have to pay duty on gifts shipped from the USA to the UK?
When you receive gifts from someone in the UK you may need to pay Import VAT and Customs Duty depending on the value of the items. For goods to qualify as a gift the: customs declaration must be complete. The gift must be sent from a private person outside the UK to a private person or people in the UK.
How much can I import from the USA to the UK without paying any duty?
There is no ay duty custom charge up to $1,600 under your exemption if the merchandise is from an IP. Up to $800 in goods will be duty-free if it is from a CBI or Andean country.
How do I know if I have to pay customs?
You have to pay Customs Duty on all goods sent from outside the UK (or the UK and the EU if you’re in Northern Ireland) if they’re either: excise goods. worth more than ₤ 135.
Can I refuse to pay overcharged customs duty?
You can, but that will be at the risk of your cargo, time and cash. The official may get convinced that you have underestimated the products by misdeclaration.
Final verdict:
Importing from the US to the UK can be a great way to grow your business. Being informed in advance can help. So you know exactly what the total cost of your import is likely to be. By using these tips and ideas, you can manage costs and protect your profits.
Reading this article you can ensure your UK import business is successful by Avoiding UK customs charges From the USA to the UK.
