Taxes on Importing products from China in the UK

Taxes on Importing products from China in the UK

Buying Items in China to the UK

China is currently one of the great superpowers of the world, making the country a serious rival for the United States for being the largest economy of the world. Its success could be attributed to the fact that China is the biggest exporter in the planet right now. Its economic reforms, originally introduced back during the 70s, means that this has the capacity to make and build products cheaply, quickly, and in larger quantities. This is why it doesn’t come as a surprise that China is currently the third largest importer partner of the United Kingdom, and this demand continues to grow by the day.

Importing from Outside the European Union

With China not being a part of the EU, there are some things you have to do if you are planning to import commercially.

  1. First, you have to find the right commodity codes for the specific goods you will import.
  2. Pay the set VAT rate and fill in a VAT form if you are VAT registered.
  3. You have to register with CHIEF system and use it for declaring the goods.
  4. Pay the required duties.
  5. Secure a license for the required goods like firearms.
  6. See to it that your goods are can be imported and don’t require any import license.
  7. For a commercial import from China to the UK, you will need to hold an EORI or Economic Operation Registration Identification number. It is being used by the HMRC and UK Customs.
  8. You will need a Power of Attorney and Customs Registration number for the non-document goods, with personal effects exempted, no matter what their value might be.
  9. All invoices and labels you use must include complete details of the receiver and sender, the quantity of goods, their value, as well as a description of contents. This must also show the Commodity Codes together with a typed invoice that doesn’t contain manual changes.
  10. Some shipments and goods require an import license so you need to check with China Entry-Exit Inspection and Quarantine Bureau.

UK Duty

The UK Duty amount you will pay will depend on the goods’ declared value as well as the kind of product you are importing. Every product has its own duty percentage or rating. It is important to check this first to avoid any hurdles during the process.

VAT on Imports

If the shipping quote states plus UK Duty and VAT, you must not assume that this VAT is part of the shipping price. The truth is that this is the VAT on taxable import. If you purchase any goods from outside the European Union, you will not be paying VAT to your supplier, yet it doesn’t necessarily mean that you will not be paying it at all. The taxable import wherein the VAT is payable is actually the amount you will be paying for your goods together with the cost of shipping and the UK Duty. Basically speaking, you will pay VAT on every single thing that it costs for you to purchase the goods and have them circulating within the United Kingdom.

note: The UK is still in Brexit mode, how things will change in the future is not clear yet.