I received an item I'd ordered from the US valued at $25. According to HMRC their July exchange rate valued this in Sterling at Â£15.88 - therefore liable (by 88p) for Import VAT of Â£3.17. That's not so bad, however Royal Mail then decided to apply an Â£8Â international handling charge. Outrageous! Not only is this vastly disproportional to the value of the item, it doubled the eventual cost of my purchase. I write in and complained, writing that I felt this doesn't represent the amount of work required to process the item of post. I remember a time not so long ago when the handling fee was only Â£5, then it slowly crept up to Â£6... then Â£8... And I have a feeling it's going to increase again soon.
Bizarrely shipments from places like Hong Kong seem (for the moment) almost immune of these handling fees (courtesy initially of the UKBA and HMRC) yet almost every single rateable consignment from the USA now has fees enforced against it. Simple way of the Revenue earning some extra coin? I don't mind about that given the Import VAT was only Â£3, it's Royal Mail's secondary bandwagon gouging of the customer that's disgraceful - no alternative but to refuse receipt of the item and have it returned to sender. Monopolistic behaviour and borderline scam tactics. The fact RM don't even scale the handling charge dependent on the declared item value (or the amount of VAT levied) is frustrating, that would be a much more customer friendly solution (so of course they do the exact opposite).
Given the low value of the item and the high cost of the handling fee, I asked if a credit could be issued for some or all of the handling fee. An Â£8 handling fee is simply not justifiable when it represents half of the item's value. Let's see if they respond...
NB that all mail handlers including private couriers will usually charge a similar fee unless the overseas seller has an arrangement with HMRC whereby they can collect the VAT at point of sale - which would sidestep these additional charges. I wish there was a way I could declare a purchase to (and pay) HMRC the VAT directly, the current situation is nothing short of extortion.
If you feel you've been overcharged Import VAT or Customs Duty, there's two forms available for you to complete and return to the relevant body to contest the charge. Which one you use depends on how you received the item; for items received through Parcelforce or Royal Mail, Google for the "BOR286" form which you need to send to the UKBA Office listed on the Charge sticker on your item. For consignments handled by any other third party couriers, you need the "C285" form (instructions here).