Tax and duties for goods sent from abroad
Following the end of the Brexit transition period new rules regarding tax and duty apply to goods sent to the UK from the EU. These changes are to ensure that goods from EU and non-EU countries are treated in the same way and that UK businesses are not disadvantaged by competition from VAT free imports.
For goods sold directly to customers in the UK from overseas with a value of £135 or less (which aligns with the threshold for customs duty liability) the point at which VAT is collected has moved from the point of importation to the point of sale.
Online marketplaces that are involved in facilitating the sale are responsible for collecting and accounting for the VAT. Business to business sales not exceeding £135 in value will also be subject to the new rules, but VAT can be accounted for by way of the reverse charge process.
In addition, from 1 January 2021, low value consignment relief (LVCR), which was an import VAT exemption for goods valued at £15 or less, has been removed.
Normal VAT and customs rules on consignments valued at more than £135 will apply on the import of goods into Great Britain from outside the UK or into Northern Ireland from outside the UK and EU.
There are different rules if you sell goods to Northern Ireland from the EU or move goods between Northern Ireland and the EU.