This should make it crystal clear
Q I have been charged VAT and duty for goods bought over the Internet, why is this?
A Any goods purchased from outside the EC are liable for duty and in some cases VAT. If you have been sent a gift and the value is under £36 you will not be liable, over that amount you will be charged depending on the product. For purchases bought by yourself with a value over £18.00 you may have to pay duty depending on the product; it may also be liable to VAT. Under that amount you will not be liable
Is duty and VAT charged on gifts?
A gift is not free of duty and VAT merely because it is a gift. The EC agreement allows them to be imported free of charges only if they comply with these rules:
Rule
Description
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The value of the goods must not exceed 45 EURO (currently £36).
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They must be correctly declared.
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They must have been sent from a private person abroad to another person in this country.
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The gift must be for the use of either yourself or your family.
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There is no commercial or trade element and they have not been paid for either directly or indirectly.
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Any alcohol, tobacco products, perfumes or toilet waters are within the allowances shown in paragraph 3.4. anything over those allowances is liable to charges.
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They must be of an occasional nature only, such as a birthday or anniversary.
Does the sender have to declare the goods?
Under international postal agreements, the sender must make a Customs declaration on a form which, in most cases, will be attached to the package. The declaration includes a description of the goods, their value and whether they are gifts or commercial items. Any Post Office abroad should be able to give advice to the sender. It is in your own interest, whenever possible, to ensure that the sender abroad makes a complete and accurate declaration.
If no declaration is made, or the information given is inaccurate, the package may be delayed while we make further enquiries or in some cases the package and its contents may be seized.
How are Customs charges calculated?
Charges are raised at the Customs Postal Depot where the goods are imported. The Customs charge levied will depend on the type of goods imported and will be one or more of the following:
Type of duty
Description
Customs (Import) Duty
This is charged as a percentage of the value. The percentage varies depending on the type of goods and their country of origin. Duty is charged on the price paid for the goods including any local sales taxes plus postage, packing and insurance costs. However, postage is excluded from the calculation for duty on private gifts sent by postal means other than Datapost. Where the value of private gifts falls between 45 EURO (£36) and 350 EURO (£282) per consignment, a flat rate of 3.5% import duty may be applied but only if it is to your advantage. The flat rate does not apply to VAT or excise goods such as alcohol and tobacco.
Excise duty
This is charged on alcohol and tobacco products and is in addition to Customs Duty. The Excise Duty on wines and spirits depends on the alcohol content and whether wine is sparkling or still. Excise Duty on cigarettes is based on a percentage of the recommended retail price combined with a quantity charge. Excise Duty on other tobacco products is based on the net weight.
Value Added Tax
Import VAT is charged at the same rate that applies to similar goods sold in this country. The value of the goods for import VAT is based on the value for Customs Duty plus any duty charged.