If you're planning to send gifts to friends and relatives in the UK from the US and most other countries, knowing the rules will save you money and embarrassment.
Keep in mind that regulations and practices described here may change or be adapted when the UK leaves the EU because of Brexit as of March 2019 - so watch this space.
Knowing all the facts about UK customs regulations is vital if you are sending or bringing holiday gifts or celebration presents into the UK. A fine, a levy for duties and taxes or, worse, a confiscated package are probably not tops on your gift-giving list. Before you bring or send holiday food products, have a look at the very detailed Personal Import Rules Database.
Here are 10 pointers that can help you avoid the pitfalls and ensure that your presents arrive safely, legally, and intact.
1. The Definition of "Gift" From the Taxman's Point of View
Everyone knows what a gift is, right? Not necessarily when it comes to official rules and regulations. The question is not as silly as you might think. For purposes of excise duties and Value Added Tax (VAT), a gift must be sent from one private person to another private person (with a completed customs declaration) for use by the recipient or the recipient's immediate family. So, if you're thinking of letting a shop ship your present to Aunt Felicity in London, the taxman won't consider that a gift. The same is true if you send someone a gift purchased on the Internet.
There is one way around this, and it is legitimate. If you like to shop on the Internet and have presents shipped, use one of the large, international online merchants—like Lands End or Amazon—and shop with your credit card on that company's UK website. Usually, the web address or URL will end with ".co.uk" instead of ".com." The shipment then becomes a domestic shipment, with taxes and VAT already included in the price, so no additional duties are required.
Another good way of ensuring you are shopping in the right place is to notice how the goods are priced. Goods on a UK website will always be priced in pounds sterling. Some merchants now accept international payments through PayPal as well.
2. Which Gifts Require Payment of Duties?
Duty is due on gifts worth more than £135 being sent from outside the EU. Exceptions apply to alcohol, tobacco products, perfume, and toilet water for which there are separate duty-free allowances. Duty is waived if the total due is less than £9.
If you are traveling to the UK and bringing presents in yourself, different allowances apply. Check the UK Customs Regulations to find out what you can bring into the country yourself.
3. How Much Duty?
If the value of your gift is more than the duty-free allowance for mailed gifts of £135, the recipient pays the duty after the goods arrive in the UK but before they are delivered. Generally, on amounts of between £135 and £630, the rate of tax is 2.5 percent. Duty is waived if the amount due is less than £9. The tax on gifts worth over £630 varies, depending upon the type of goods and their country of origin.
It's impossible to give a general figure for the rate of duty as, unbelievably, there are 14,000 different classifications of goods with varying rates of duty for each based on their country of origin. The average is between 5 percent and 9 percent of the value of the goods, but it ranges from 0 percent to as high as 85 percent. Your best bet, if you are sending gifts worth more than the £135 horizon, is to check with the UK Customs and Excise helpline.
In the past, if the postman was delivering a gift on which duty was due, he would simply ring your bell and collect the money. That doesn't happen anymore. These days, the postman leaves a notice telling your recipient where to go for the package and how much it will cost. It's inconvenient for the recipient, so it's a good idea not to mail gifts worth more than £135. Save those for your next visit when you can deliver them in person.
4. VAT on Gifts Sent From Outside the EU
VAT is due on gifts worth more than £34 per person, mailed from outside the EU. This is a more generous allowance than goods you order from abroad for yourself which are subject to VAT if worth more than £15.
VAT is a kind of sales tax that is likely to change once BREXIT, the UK's exit from the EU goes into effect. As before, if any tax payment is due, recipients receive printed notices from the carrier—the British Post Office, Royal Mail, DHL, or UPS, for example—telling them how much is due, how to pay it, and where to pick up their package.
5. Gifts to More Than One Person Sent in the Same Package
If you are sending presents to different people in the same household—Christmas gifts to members of the same family, for example, you can combine them in the same package without confusing the per person allowances.
Each present must be individually wrapped, addressed to a specific person, and listed on the customs declaration. If you do that, then each gift can benefit from the Import VAT £34 gift allowance.
Similarly, each correctly identified and declared gift benefits from the £135 duty-free allowance. So—if you sent five gifts worth £33 each, for five different people in one package, as long as you wrapped them, addressed them, and listed them separately on the customs declaration, no tax or VAT would be due on the whole package.
If each of those five gifts were worth more than £34, they would each be subject to VAT. But if they were also worth less than £135 each, customs duty would not be required. Yes, it's confusing. Just think of VAT and Duty (or excise) as two different taxes subject to different value rules.
6. Completed Customs Declarations Prevent Delays, Potential Damage, and Extra Costs
Customs and Excise officials regularly spot check packages arriving by post from outside the EU—even during the busy holiday periods. If you don't fill out the customs declaration—that lined bit of green paper glued to your package—they may open your package to inspect what's in it.
Even though packages are opened by Royal Mail employees or the authorized employees of bonded carriers operating under strict guidelines, and even if everything is entirely above board, the recipient will be charged a handling fee before the package can be delivered. And there is always the risk that the present might be damaged.
What if you don't declare banned or restricted goods? Or try to conceal real value on your customs declaration? If you declare banned goods, they will be destroyed. But, if you don't declare them and they are discovered, they will be destroyed, and you or the recipient will face criminal prosecution and a potentially a hefty fine. So is it going to be your lucky day? Probably not.
7. Cheese and Meat Products
Surprisingly, this is an issue that pops up every year around the holiday season, also when students head back to universities, and schools in the UK. Visitors from the big dairy-producing states in the USA always want to know if they can bring their local cheeses or specialty cured hams to friends in the UK. That's a quick no. All dairy and meat products, fresh or prepared, from outside the EU are forbidden. There are no shades of gray about this and no negotiations. If found, these products are destroyed.
8. Counterfeit and Pirated Goods
You know that cute little fake Chanel handbag you bought from the street trader outside Penn Station in New York? Maybe your cousin Bianca in Liverpool would love it but if you are mailing it as a gift from outside the EU, there's a good chance it could be found in a spot check, Besides being destroyed, you—or more likely your poor innocent cousin Bianca—could be prosecuted.
9. Read a Copy of the Rules
...because some surprising things are banned: fresh chestnuts, for example, though other nuts are not. Potatoes are banned, but sweet potatoes and yams are not. And "non-manufactured" bark-free wood is banned from outside the EU and restricted to five pieces from within. If you're scratching your head over what this might be, think driftwood and the sort of driftwood and pebble art you can pick up at craft fairs.
Sniffer dogs are really good at finding that kind of stuff in the post. The UK government website has an overview of the rules as well as links to more specific regulations. A good rule of thumb is if in doubt, don't bring it.
10. Weights and Measures
Some items, particularly certain fresh fruits and vegetables, are only allowed into the UK in restricted quantities. Exceed the limit, and all the products will be seized and destroyed. So don't think it'll be all right to send 2.5 kilos of apples when only 2 kilos are allowed, or six packets of commercially packaged seeds instead of the allowed five. Customs officers don't play pick and mix. If you're over the limit, the whole lot gets thrown away.