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Posted by John Howells on 09/07/06 16:00
"Nimrod" <ak@ak.com> wrote
> What was the value of the parcel ?
>
> 37 not including shipping from the US which shouldn't count
The shipping cost does *NOT* count when deciding whether the value exceeds
the 18 threshold, but *DOES* count when that threshold is exceeded and VAT
becomes due. See Notice 143 on the HMRC web site (google for "hmrc notice
143"), which notes in section 3.1:
>>
Value Added Tax (VAT) - Import VAT is charged at the same rate that applies
to similar goods sold in the UK. The value of the goods for import VAT is
based on the value for customs duty plus any import duties charged.
<<
and for customs duty:
>>
Customs duty - .... Duty is charged on the price paid for the goods
including any local sales taxes plus postage, packing and insurance costs.
<<
No customs duty will be due, as the value falls below the threshold. The
duty rate is 3% and the threshold is 7, so duty only becomes due if a
single package, including shipping costs, is worth over 230 or so.
However, the value of the goods for calculating duty will be used when
calculating the VAT. VAT of 9.81 equates to 56.05, so you would have had
to pay about 19 in shipping for that VAT amount to be correct.
John Howells
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