United Kingdom - Country Commercial Guide
Customs Regulations
Last published date:

UK custom regulations are established by His Majesty’s Revenue & Customs (HMRC). HMRC is the UK’s tax, payments, and customs authority, and it collects money that pays for the UK’s public services. The HMRC lays out all of its general information for importers and exporters in the document titled ‘UK Trade Tariff: Volume 1’, published on January 1, 2009 and periodically updated.

Value Added Tax, or VAT, is applicable on goods imported into (and exported out of) the UK, and is governed by the Value Added Tax Act 1994 (an act of Parliament (Westminster)), particularly Section 15 to Section 17 of this statute, which details the charge to the tax applicable in the case of ‘Imported Goods from Outside Member States’ (i.e., outside the EU). The VAT is charged as though it is a custom duty, and provisions in the Community Customs Code (from the European Economic Community) and the Customs and Excise Management Act 1979 apply while appropriating VAT in relation to imported goods.

The liability of VAT on goods is ascertained by assigning them ‘commodity codes’, which are again detailed in the ‘UK Trade Tariff: Volume 1’ from the HMRC.

On exportation, however, VAT is generally not applied, i.e., nil rate applied on VAT. Merely providing proof of export is enough for an export to be cleared. The rate of the VAT may increase or decrease, and Section 2(2) of the Value Added Tax Act 1994 grants Her Majesty’s Treasury (HM Treasury, or Treasury) the authority to decrease or increase the rate of VAT by 25% for a period of one year. See the HMRC’s guidance on VAT rates for further information.