HOW MUCH IMPORT & TAXES WILL I PAY ON ELECTRICAL EQUIPMENT BROUGHT FROM USA SHIPPED TO UK?

Question

I intend to buy some electrical equipment from the U.S.A for use in my business (not to re-sell). The equipment costs around $19,500.00 and shipping is $550.00 (around £10,800) The items will be delivered to my house in the UK. What arrangments do I have to make regarding importing and what will import charges and taxes be??

Will be very grateful for any advice anyone can give.

Cheers

Answer 1

Depends what exactly the items are but very roughly 15% import PLUS 17.5% vat of that total PLUS the ccompanyhandling will charge a fee for dealing with customs on your behalf

Answer 2

You will pay Customs Duty and Import VAT on the CIF Value (Cost Insurance Freight)  If the Insurance is covered by the shipper, Customs will apply around 0.2% of the value as a reasonable amount, so its negligable.

Based on the Value at £10800, you will pay Customs Cuty of around 5%-10%. You then pay VAT on the CIF Value plus the Duty.  So at £10,800 with 10% duty of £1,1080 you pay 17.5% of £11,880 = £2,079.

So you're looking at £1080 duty and £2079 Import VAT.

If you can post or PM the product, I can give you a better idea of the Customs classification and the duty rate.

On the Import VAT, if your business is VAT registered you can reclaim the Import VAT, quite easily.  Customs will provide a C79 VAT Certificate, that you use to reclaim the input tax on your VAT return.

On importing, the freight company will do the Customs entry for you.  They will contact you and ask for import details.  Make sure they quote your VAT number correctly, and declare the product correctly (the risk is that they take the easy option and import to a duty relief that has conditions, e.g repair and re export).  It makes the import easier for the freight company and has Customs looking for their money later on.

They may charge you for the Customs Entry - although this should be in the shipping costs, so question it and don't pay more than £15-£25 for a Customs entry.  They will also charge for using their deferment account (payment method for Customs).  Shouldn't be more than 2-3% of the taxes.