VAT on imports
Generally, VAT on imports is the same rate as if you were buying
goods from within the UK. But you need to do the right paperwork,
and know the rules. Importing from within the EU is fairly
straightforward, but it's a little more complicated importing
You need to tell HMRC about all goods you import from abroad -
known as declaring.
An accountant is always worthwhile for more complicated tax
affairs, but this guide can give you an introduction to the rules
and an idea about whether you think you'll be able to handle VAT on
imports on your own.
VAT on imports from within the EU
- If you buy goods from within the EU whose total value is more
than £70,000 over the course of the tax year, you need to get
VAT-registered in the UK.
- The process of importing good from within the EU is called
acquisitions rather than imports by HMRC.
- The VAT on goods imported from the EU that are in free
circulation is known as acquisition tax.
How much is the VAT (acquisition tax)?
- You pay the VAT (acquisition tax) at the same rate as the VAT
would be if you had bought the good in the UK.
Keeping records of the VAT (acquisition tax):
- Keep records throughout the tax year in the same way as you
would for goods bought within the UK.
- The date of 'supply' (when you bought the goods
for the purposes of HMRC) is the date when the transaction actually
took place. Use the date the supplier put on the invoice if you're
- The value of the goods has to be recorded in pounds
- You can use the rates published in newspapers.
- Or you can use the rates published by HMRC - this is typically
easier, as the usually only change once a month, rather than daily
like newspaper rates can.
- If you want to use a different set of conversion rates (which
may offer commercial advantage) you have to write to HMRC to see if
they'll let you.
Reclaiming the VAT (acquisition tax):
- You reclaim the VAT (acquisition tax) in the same way as you
would as if they'd been bought in the UK.
On your end of year tax return, you put in the
details of your total acquisition tax into box 9. You include it in
your total in box 2.
Other documentation you might need:
- If the total value of your imported goods in a tax year
is more than £260,000 you may have to fill out an Intrastat
Supplementary Declaration. Talk to HMRC for more info.
VAT on imports from countries outside the EU
You need to declare good imported from outside the EU to HMRC
(using an import declaration form) and pay VAT and duty due on
How much is the VAT?
- VAT on imports from countries outside the EU is charged at the
same rate as if you were buying goods inside the UK (except for
art, antiques and collector's items, which get a reduced
Keeping records of the VAT:
- Keep records of all imported goods and the VAT you
pay on them as you would if you were buying goods from within the
- The value of the goods for your records is their
customs value plus incremental charges (shipping, packaging, etc),
any customs duty, any excise duty, any levies and any other charges
for bringing the goods into the UK (apart from the VAT).
- The value of the VAT is in box 22 of the import
declaration. (If it's not, write 'VAT' in the rate column of box
47, calculate put the amount and write it in the amount
Reclaiming the VAT:
- If you're VAT-registered in the UK you can reclaim
the VAT you're charged as input tax - you need to fill out a form
C79 to do this (shipping and forwarding agents normally can't
- If you're not registered, you still have to pay
the VAT but you can't reclaim it. So if you're planing on doing a
lot of importing it's well worth looking into registering.
How and when you pay VAT on imported goods from any
The following rules apply whether you're importing from within
the EU or outside it:
- You normally pay the VAT at the time the goods come into the
- If you are receiving a postal order worth less than
£2,000, you can wait until you submit your VAT return to
- If you are a regular importer and the value of the VAT is
high, you may be able to arrange with HMRC to defer payments
for up to 30 days. Speak with HMRC to see if you qualify.
- If you're making numerous VAT payments in imports,
you may be able to HMRC's Duty Deferment Scheme and Simplified
Import VAT Accounting (SIVA), which simplifies the process so you
only have to make one payment a month.
Find out more about it here.
- If you are storing the goods in a customs warehouse, you
are importing from a free zone, you are only importing goods from
outside the EU on a temporary basis or you are using community
transit, different rules apply and you may not have to pay
all or part of the normal VAT owed. See the bottom sections of
this HMRC page for more info.
Declare: to tell HMRC about goods you are importing
or exporting through the correct paperwork (an import declaration
form and any other forms necessary)
Free circulation: means good have come from another
EU country or from somewere outside the EU but with VAT and duty
Released: when HMRC allows you to bring the goods
into circulation, to use or trade them (when all VAT and duty has
Acquisitions: what you call importing within the
Acquisition tax: the VAT on goods bought/imported
from within the EU that are in free circulation (the equivalent of
input tax on goods bought within the UK)
What about if I'm buying services abroad? Do I need to
take account of VAT with them?
Yes, in some cases. If you do, you act as both the supplier and
the buyer, so you charge VAT then also claim it back, so the VAT
cancels out leaving you with no charge (this is known as reverse
charging, or 'tax shift'). But as services abroad is a more complex
affair, you need to speak to HMRC to find out what to do.
What if I'm sending the goods straight onto another EU
You may not have to pay VAT. Read more about this case on the
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