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A new ruling on import tax will benefit thousands of online UK shoppers and businesses.
But, as always with tax, there are certain strict rules...
So talking tax is definitely not the most exciting thing in the world, but as soon as you mention a tax break, everyone gets interested. Well, just as a recession – and Christmas – is looming, the lovely people at HM Revenue and Customs have decided that online consumers won’t have to pay customs duty on anything bought outside the EU for less than £105.
We’ll see this come into effect on the 1st December, benefitting thousands of internet shoppers and internet-based businesses.
The duty-free limit will also be extended to online purchases less than £18, (anything above this amount will still get stuck with VAT), but it’s still important to know where you stand in this financial minefield, as import duties vary wildly, depending on the type of goods.
Randomly, gold or silver jewellery sits at a 2.5% rate, whereas imitation jewelry runs at 4%. Books are exempt of tax, but CDs currently aren’t, unless they cost less than £7. Anything from the EU is already exempt from Customs duty or import VAT – but you can’t buy alcohol or tobacco unless you pre-arrange excise duty in advance.
It can all get a little bit confusing, but all you really need to know is that for most of your online Christmas shopping, if it costs less than £105 – that’s around US$150 – then it’s probably not going to get attacked by the taxman.