Ensuring that your goods are correctly valued for declaration to the local customs authorities is arguably one of the most critical aspects of the whole door to door supply chain.

Import taxes are calculated based on the value of goods declared to customs at the time of import. Other charges are also used in the valuation build up calculation of taxes but are generally declared separately to the goods value on the customs entry, these additional charges can be freight costs, insurance, and VAT adjustments.

If you are purchasing your product from a non-related third-party supplier and importing the goods directly into the UK or EU, then usually the transaction value will be acceptable and declared on import. This is the price paid or payable by the buyer to the seller.

There may be occasions where the importer is not importing goods directly from the manufacturer, for example forwarding from their US based warehouse. If for example the seller has purchased product from a Chinese manufacturer and imported into their US warehouse for storage to then send onto the UK market then the transaction price paid to the CN supplier will not suffice, in such an instance you may need to build up your value considering other factors, some examples are listed below, or use another method all together.

• Transaction price (amount paid to CN manufacturer)
• Freight/insurance cost from China to US facility
• Import duties/taxes paid upon import into US
• Any re-work/handling/delivery/storage charges whilst product is in US

You can find official guidance from HM Revenue & Customs here – Valuing your Goods

Valuation is a key topic in the UK & EU with authorities working hard to stamp out the major issue of under-valuation and with the authorities able to audit and re-value imports up to 4 years it is important to get it right first time to avoid any unwanted surprises further down the line. If you are unsure how to ensure the value of your goods is correct, please get in touch with one of our experts today who can offer guidance.

For more information, please contact our team.