Emma23

Hi everybody, I would like to know how the £135 threshold for avoiding upfront VAT and Customs Duties on an import from the EU into the UK is calculated. This is for a normal online shopping situation, nothing complicated. I understand that if the “value of the goods” is less than £135, I do not pay Customs Duty, and the VAT is paid by the seller. If the value is above £135, I pay both VAT and the applicable customs duty rate for that item. I understand that there are two different values involved here - the value which is used to calculate if the goods cost more than the £135 threshold (let’s call this the ‘threshold value’), and the value(s) which is multiplied by a percentage to calculate how much VAT or Customs Duty should be paid if the item is determined to be above the threshold (let’s call this the ‘calculation value’). As I understand it, the ‘calculation value’ calculates the Customs Duty payable using a base value which includes shipping and insurance, and then VAT gets calculated on top of that using shipping, insurance and Customs Duty as part of the base value. However, I don’t understand how the threshold value is calculated. My questions are: Does the value used to calculate the £135 threshold for VAT include the cost of shipping and (optionally) insurance? Does the value used to calculate the £135 threshold for Customs Duty include the cost of shipping and (optionally) insurance? Thanks for helping out!