Excise and Customs Duties in the UK

14 June 2022

Both of these taxes are separate from VAT.

advice : Tax

Excise and Customs duties are different types of taxes applied on goods when brought into the UK. In this blog, we will be looking at each of them, the differences between them, and the key rules.

Customs Duty in the UK

Customs duties are taxes imposed on goods imported into the UK from foreign countries based on the good’s value. 

The charge will be raised if your goods are being sent from outside the UK if they’re either:

  • excise goods; or
  • worth more than £135

If it’s applicable, then you’ll need to pay it on:

  • the price paid for the goods; and
  • postage, packaging, and insurance

You also need to pay Customs Duty on excise goods regardless their value. To find out more please visit Gov.uk website.

Excise Duty in the UK

Excise duties are taxes imposed on certain goods that are considered to be harmful to public health or the environment. These goods may be either of UK origin, received in the UK following an intra-EU movement or imported from outside the UK or EU. The amount of this duty paid is based on their weight or volume, however, there are some exceptions

The duty falls due at the time when the goods leave any duty suspension arrangements such as:

  • when they are released for consumption or otherwise made available for consumption registered trader or occasional importer receives them in the UK
  • when a vendor makes a delivery under distance selling arrangements
  • when missing consignments and other dutiable shortages are discovered
  • when goods imported for personal use are then sold or put to commercial use

In the UK, the following forms of excise are levied on goods and services:

  • wine and made-wine
  • beer
  • cider and perry
  • spirits
  • low alcohol beverages
  • imported composite goods containing alcohol
  • tobacco products
  • hydrocarbon oil — this section includes details about rebates for such products
  • Climate Change Levy
  • Biofuels

It is important to remember that the money raised through the excise duty may be used to address specific social causes related to the related product or service. Excise duty is paid by the manufacturer or importer of the product rather than the consumer.

Are Custom Duty and Excise Duty part of VAT?

Please note, that both types of taxes are separate from Value Added Tax (VAT) which is a tax imposed on all goods and services sold in the UK. VAT amount on a good or service depends on its value. 

Banned and Restricted items In the UK

If you are receiving commercial goods in the UK from other countries, you must ensure that your goods are legally allowed in the UK and that you pay the correct tax and customs charges. 

The banned & restricted items in the UK include: 

  • Drugs
  • Counterfeit goods
  • Rough diamonds
  • Endangered animal products
  • Indecent and obscene materials.
  • Weapons and self-defence items
  • Personal imports of meat and dairy products from most non-EU countries
  • Food and plant products if they aren’t free from pests and diseases 
  • Goods or items suspected of infringement
  • Firearms, explosives and ammunition, unless you have a special license.

For more information about Taxation rules for businesses in the UK, please get in touch

Nothing on this page is intended to be or should be construed or taken as accountancy, investment, tax or any other kind of advice. We recommend individuals and companies seek professional advice on their circumstances and matters.