The £135 Rule and Carrier Handling Fees on Parcels From the EU

Why does an order from an EU supplier sometimes show UK VAT at checkout and sometimes arrive with a customs charge and a carrier handling fee, and what does a VAT-registered buyer do with each?

The £135 threshold applies to the value of the whole consignment. For goods bought from an overseas seller and sent to Great Britain, a consignment of £135 or less generally has UK VAT charged by the seller at the point of sale. A consignment above £135 generally has import VAT collected from you by the carrier before delivery, plus any customs duty and the carrier's own fee ^[1][2].

So the same EU supplier can produce two different experiences for two orders. One shows a VAT line at checkout and arrives without any further payment. The other arrives with a card through the door or a text message asking you to pay. Neither is an error. They are two regimes separated by one number.

One consignment, two regimes

GOV.UK sets out the rules for goods sent from abroad in terms of the £135 line. For a consignment you bought yourself, worth £135 or less, the seller usually included the VAT in the price. Above £135, you pay VAT to the delivery company before delivery or on collection ^[1].

Customs duty follows a different split. In Great Britain it is charged on excise goods at any value and on non-excise goods over £135. Non-excise goods worth £135 or less attract no duty ^[1]. Above the line, the rate depends on the goods and where they come from, which brings the commodity code into play.

Under £135: why the EU seller charges UK VAT

For a direct sale of a consignment of £135 or less to a customer in Great Britain, HMRC guidance says the overseas seller must charge UK VAT at the point of sale. The seller needs to register for UK VAT, apply the correct rate and keep records ^[2].

That is why a checkout from an EU supplier can show a UK VAT line. The supplier is acting as a UK VAT collector for that sale. If the line is absent on a small consignment to a private buyer, it is reasonable to ask the supplier how they are handling UK VAT, because the buyer may otherwise meet a charge later.

The guidance also covers a trap in the other direction. If a seller changes the stated values so that the total rises above £135, it may owe import VAT and customs duty, and has to adjust the VAT it already accounted for at the point of sale ^[2].

Above £135: import VAT, duty and the carrier's fee

Over £135, ordinary import rules apply ^[2]. The carrier clears the goods, calculates import VAT on the total value including postage, packaging, insurance and any duty, and asks you to pay before it delivers ^[1]. Parcels are usually held for about three weeks and then returned to the sender if unpaid ^[1].

The carrier's handling fee is separate from the tax. Which? publishes consumer guidance on VAT, import and handling costs ^[4]. It is the carrier's charge for doing the clearance work. It is set by each carrier, it is revised from time to time, and it is not set by HMRC. This article does not quote an amount. Read the figure on the Royal Mail, Parcelforce or courier fee page that applies to your parcel on the day it arrives.

You can ask for a refund of VAT or duty if you return the goods or believe you were overcharged. GOV.UK names form BOR 286 for Royal Mail or Parcelforce and form C285 for other couriers or freight companies ^[1].

How the threshold treats a multi-item order

The HMRC guidance says to add up all the items in a consignment unless each is sent individually, and that the £135 limit applies to the whole consignment ^[2]. Value means the price paid, leaving out transport, insurance and other taxes where those are shown separately.

Two practical points follow. First, an order split into several parcels by the seller is only treated as separate consignments if it really was sent separately. Second, the label to read is the declared value on the commercial invoice and customs label, since that is the figure the carrier works from.

A genuine fee card or a scam?

Parcel-fee text messages are a long-running scam. Which? documented a fake Royal Mail text in 2021 in which a scammer tried to take thousands of pounds from a victim ^[5]. The pattern has not gone away.

1. Start from your own records. Do you have an open order from an overseas seller that could plausibly attract a charge? If not, the message is not about your parcel.
2. Do not follow a link in a text or an email. Go to the carrier's website by typing the address yourself, and enter the tracking number from your order confirmation.
3. Check that the tracking page shows a held parcel and a payment request. A real charge is visible there.
4. Compare the amount with a calculation: import VAT on the declared value plus postage, plus any duty and the carrier's published fee.
5. If anything about the page asks for more personal information than a payment needs, stop and contact the carrier directly.

Northern Ireland and a wrongly charged parcel

Northern Ireland follows different rules. GOV.UK lists separate treatment for duty on goods considered at risk of entering the EU, and separate treatment of VAT on goods from the EU and from outside the UK and the EU ^[1][2]. If you are delivering to a Northern Ireland address, read the GOV.UK pages for Northern Ireland and do not assume the Great Britain rule above applies.

If you think a charge is wrong in either case, the route is the refund process in the section above, backed by the invoice and the commodity code the seller used. A charge that does not match the invoice value is the most common reason to challenge.

What a VAT-registered buyer keeps

A business buyer has a different position from a private one. HMRC guidance says that if a UK VAT-registered customer gives the seller a valid VAT number, the seller does not charge VAT. The invoice carries a note such as "reverse charge: customer to account for VAT to HMRC", and the customer accounts for the VAT, usually recovering it as input tax ^[2]. For imports into Great Britain above the line, postponed VAT accounting is the route covered in a companion article.

• The seller's invoice, showing UK VAT charged or the reverse-charge note.
• For an import cleared by the carrier, the import VAT document the carrier issues, which may be the C79 certificate or a postponed-accounting statement, kept in the form HMRC requires.
• The tracking record and the declared value, so a later query can be reconciled.
• The carrier's fee receipt, kept separately because it is the carrier's charge for its service.

HMRC's guidance says to keep full records, including invoices, for six years from the date of sale ^[2].

The announced end of the £135 duty relief

The government has now published its position on the duty relief. HMRC's policy paper dated 13 July 2026 says the customs relief for low-value imports will be removed, and that the measure takes effect on a day the Treasury appoints by regulations, by October 2028 at the latest ^[3]. This was checked against the GOV.UK paper on 10 October 2026.

Three limits apply to what that paper says. It concerns customs duty, and it does not set out a change to how VAT is collected. It gives no date other than the October 2028 backstop. And it gives no figure for any per-consignment charge, so none is stated here ^[3].

Until the regulations bring the change into force, the relief described earlier in this article still applies. Watch the GOV.UK page and the Trade Tariff for the commencement date rather than relying on commentary, since press and trade summaries differ in the details.

What to check next

Before the next order, check three things. Ask the supplier whether they charge UK VAT at checkout and under what registration. Work out whether the consignment value is likely to fall above or below £135. And find the current handling-fee page for the carrier the supplier uses.

Then keep the paperwork to match: invoice, declared value, tracking record, and for a VAT-registered buyer the import or reverse-charge record.