Import VAT
Category: tax
VAT charged on goods at the point of importation, usually reclaimable on the VAT return.
Import VAT is the value-added tax charged on goods when they enter a country, collected by customs authorities at the border. In the EU and UK, import VAT is paid at the point of import but is generally reclaimable as input VAT by VAT-registered businesses. The IOSS scheme allows pre-payment of import VAT on goods valued at or below €150, enabling faster customs clearance.
Examples
- • A UK seller importing £5,000 of goods from China pays 20% import VAT (£1,000) at customs, which is reclaimable on their next VAT return.
- • EU import VAT on goods valued over €150 is collected at the border; goods with IOSS prepaid VAT clear customs without additional charges.
- • Postponed VAT Accounting (PVA) in the UK allows importers to account for import VAT on their VAT return instead of paying at the border.