Generally, all goods imported into the UK are subject to the UK Global Tariff (UKGT). A tariff is a tax or duty imposed by one country’s government on goods and services imported from another country.
The tariff makes imported goods and services more expensive to buy because the importers have to recoup the tax and duty paid.
|Protect local businesses by giving them a better chance to compete in the industry. They can charge a lower price to increase demand.||Imported goods and services become more expensive|
|Protect domestic manufacturers and employ local people||Importers may stop importing if demand is low because they have to charge expensive price tags, which leads to a loss of income for the government.|
|More money for the government through collecting import taxes and duties.|
No Tariff to pay
There are situations where the UK global Tariff does not apply to your imported goods.
Free Trade agreement
You are importing goods from a country that has a trade agreement with the UK. For example, The UK has already signed a free trade agreement with Japan on 23 October 2020. You can read more about the UK-Japan Comprehensive Economic Partnership Agreement (CEPA) on GOV.UK website.
The UK helps businesses to remain competitive in the global market by suspending import duties on certain goods. Usually, these goods are used in domestic production. For example, The Uk suspends all tariffs on a group of medical items critical in the response to COVID-19 on 1 January 2021. The suspension is for 12 months on all goods listed by the World Health Organisation (WHO) as critical goods would have 0% duty. For example, surgical gloves under the commodity code of 40151100 are 0% duty.
Imports from the country under the UK Generalized Scheme of Preferences
The UK reduces or removes import tariffs on imports from developing countries classified by either the United Nations (UN) or the World Bank as low-income and lower-middle-income countries. For example, The UN classified Madagascar as the least developed country. Imports from Madagascar have quota-free access and nil rates of import duty.
Department for International Trade
If you would like to export or import goods or services into and out of the UK, the UK Department for International Trade (DIT) can help you. The DIT provides the following services to businesses wanting to export out of the UK or import from overseas.
- Create an export plan
- Find an export market
- Choose a route to market
- Get export finance
- Manage payments for export orders
- Prepare to do business in a foreign country
- Prepare for export procedures and logistics
- Sell services overseas
- Manage risks of bribery and corruption
There are UK Department for International Trade offices worldwide and also DIT offices around the UK that you may contact to ask for help.
Use Trade Tariff Tool to find the Commodity code for Customs declaration
You would require to find the right commodity code for your goods to complete your customs declaration paperwork. Your commodity code will tell you the correct Customs Duty and import VAT to pay.
You may use the HMRC Trade Tariff tool to look up your commodity code. For example, a commodity code for the import of unworked Sapphire is 7103100000. The goods are subject to 20% VAT and 0% duty if it is subject to a third country duty.
You can handle your customs declaration paperwork yourself or you may hire freight forwarders, customs agents or brokers, or fast parcel operators to handle your customs declaration paperwork for you. The person or business you hire to represent you must be established in the UK.
Usually, duty must be paid before your goods can be released unless you have a duty deferment account with HMRC.
Import goods under your company’s name
You must ensure all the legal filings such as Confirmation statements, company accounts, and corporation tax returns are up to date with Companies House and HMRC if importing using your company’s name.