Double tax charges if you buy goods from Europe

Online shoppers are being overcharged, often paying double tax on goods they buy from Europe, as a growing number of people have been caught out by complex customs duties.

Since Brexit, goods or gifts received from the EU have been subject to VAT and customs duties. However, British people have repeatedly reported being charged the VAT twice.

Paul Carlier, 53, from Kent, said he paid more than £100 in unnecessary charges and taxes on the purchase of two items of clothing. Mr Carlier paid £381 for the clothing itself but paid £650.74 in total once taxes and duties were added, which came to 71pc of the value of his items. 

Before shipment the Danish retailer added £95 worth of tax and when the parcel arrived in Britain he was told he must pay a further £174.74 in costs by his courier, DHL. This included a 15pc customs duty charge of £57.12 and a further £106.62 in VAT.

“They wanted me to pay 28pc VAT on the two items of clothing. They charged me tax on tax,” he said.

Foreign retailers are not required to charge VAT or excise duty on sales of more than £135. Instead, the online shopper must pay HMRC the import tax owed.

Mr Carlier said he should have paid 12pc customs duty on the net cost of the clothing, or £45.72, and 20pc VAT, equating to £76.20. This would have taken his total bill to £502.92. “Companies are supposed to understand the rules and it’s shocking that this is ­happening. We have been in this position twice now so it is clearly a recurring issue,” he said.

A DHL spokesman said the firm was not at fault.

Andrew Thurston, of the accountancy firm MHA, said this was a problem in the industry.

“Where goods are over £135 it becomes critical to get the invoice code right. Where they are being asked to pay tax twice it is because of the way that the items are being declared upon arrival in the UK,” he said. 

“It is a very complex system and the average person buying something online is now expected to have all this knowledge. But they are reliant on these companies that have not necessarily been up to speed.”

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