When you import goods into the UK, you must work out the value of your goods to use when working out Customs Duty and import VAT. We call this value the customs value.
You need to declare this value on your import entry or your removal document from customs warehousing. You must tell us this value even if:
- there is no duty or VAT to pay on the goods
- you enter the goods to a customs warehouse
You must do this because we include the customs value of your goods when we collect and put together trade statistics for the UK.
Customs Duty
The amount of Customs Duty you must pay is often worked out as a percentage of the customs value of the goods. This type of Customs Duty is referred to as ‘ad valorem duty’.
You can check if you need to pay Customs Duty or VAT in the trade tariff tool.
Importing goods into Northern Ireland
If you import goods into Northern Ireland, the Union Customs Code (UCC) valuation rules will continue to apply.
Find out more about goods moving in and out of Northern Ireland.
How to work out the customs value of your imports
There are 6 valuation methods that you can use to work out the customs value of your imported goods. You work through the appropriate method using the values that it describes and making adjustments, additions and deductions according to the guidance and your individual circumstances.
You must try to use Method 1 first. It’s the normal method of valuation and is used for over 90% of imports which are liable to ad valorum Customs Duty.
If you cannot use Method 1 then you must try Method 2.
If you cannot use Method 2 then you must try Method 3.
If you cannot use Method 3 then you must try methods 4 or 5. You can try Method 5 before Method 4 if you want to.
If you cannot use methods 4 or 5 then you must use Method 6.
If you use any of methods 2 to 6, we may ask you to explain why you have not used an earlier method.
Method 1 (transaction value)
This is the normal method of valuation and the first method that you must try to use. It’s based on price paid or payable by the buyer to the seller for the goods when they are sold for export to the UK.
Valuing imported goods using Method 1.
If you cannot use Method 1, you must try Method 2.
Method 2 (transaction value of identical goods)
Method 2 is based on the transaction value of identical goods exported to the UK at or about the same time as the goods being valued. To be identical, the goods must be:
- produced in the same country as the goods to be valued
- exported to the UK at or about the same time
- the same in all respects including physical characteristics, quality and reputation — minor differences in appearance do not matter
Valuing imported goods using Method 2.
If you cannot use Method 2, you must try Method 3.
Method 3 (transaction value of similar goods)
Method 3 is based on the price paid or payable for goods which are similar to the goods to be valued. Similar goods are goods which are different in some ways from the goods being valued but they:
- are produced in the same country
- can carry out the same tasks
- are commercially interchangeable
Valuing imported goods using Method 3.
If you cannot use Method 3, you must try methods 4 or 5. You can try Method 5 before Method 4 if you want to.
Method 4 (deductive method)
Method 4 is based on the selling price in the UK of the goods, identical goods or similar goods.
Under Method 4, you can use the simplified procedure values scheme rates for certain whole fresh fruit and vegetables imported on consignment. You can use these rate values if you do not have a transaction value for your goods and they meet the criteria for the scheme.
Valuing imported goods using Method 4.
Valuing imported fruit and vegetables using simplified procedure values.
If you cannot use Method 4, you must try Method 5.
Method 5 (computed value)
Method 5 is based on the costs of production of the imported goods. You use the total of the cost or value of materials and fabrication or other processing used in producing the goods. Usually this method can only be used if the importer and supplier are related in a business sense. You can find out if the buyer and seller are related for valuation purposes in ‘Method 1 (transaction value)’.
Valuing imported goods using Method 5.
If you cannot use Method 5, you can try Method 4 unless you have already tried it. If you cannot use Method 4 or Method 5 you must try Method 6.
Method 6 (fall-back method)
Method 6 is based on adapting methods 1 to 5 flexibly to fit unusual circumstances.
You must work out the customs value by using reasonable means consistent with the World Trade Organization (WTO) customs valuation principles on the WTO website.
Valuing imported goods using Method 6.
Goods entering or being removed from a customs warehouse
You must declare the customs value for statistical purposes when your goods enter a customs warehouse. This information is also used for warehouse stock control purposes.
You must also declare the customs value when your goods are removed from the customs warehouse into free circulation.
In both these cases you work through the appropriate valuation method using the values that it describes and making adjustments, additions and deductions according to the guidance and your individual circumstances.
For further advice you should contact imports and exports general enquiries.
What to do if you cannot establish the value for Customs Duty
You can ask for release of your goods by paying the undisputed charges outright and securing the balance by cash or cheque — we call this a deposit. When the value is agreed you may be asked to pay more duty or you may get a refund — we call this adjusting the deposit. If the deposit equals the amount of duty due, you’ll be told — we call this bringing the deposit to account.
As an alternative to a cash deposit, you may be able to use a guarantee, underwritten by a bank. For further information contact imports and exports general enquiries.
Evidence and keeping records
The evidence that you need to keep is described in the guidance for each method. You must produce any documents and information about your imports that a customs officer needs. You may also need to let a customs officer inspect or take extracts from any relevant document.
You must keep these documents and information for at least 4 years.
What to do if you disagree with a customs decision
If you do not agree with the decision issued to you, there are 2 options available:
- if you want a review, you should write back to the decision maker within 30 days of the date of letter, giving your reasons why you do not agree with their decision
- appeal direct to the tribunal who are independent of HMRC
If you choose to have your case reviewed, you’ll still be able to appeal to the tribunal if you disagree with the outcome.
Check Disagree with a tax decision.
When you import goods into the UK, you must work out the value of your goods to use when working out Customs Duty and import VAT. We call this value the customs value.
You need to declare this value on your import entry or your removal document from customs warehousing. You must tell us this value even if:
- there is no duty or VAT to pay on the goods
- you enter the goods to a customs warehouse
You must do this because we include the customs value of your goods when we collect and put together trade statistics for the UK.
Customs Duty
The amount of Customs Duty you must pay is often worked out as a percentage of the customs value of the goods. This type of Customs Duty is referred to as ‘ad valorem duty’.
You can check if you need to pay Customs Duty or VAT in the trade tariff tool.
Importing goods into Northern Ireland
If you import goods into Northern Ireland, the Union Customs Code (UCC) valuation rules will continue to apply.
Find out more about goods moving in and out of Northern Ireland.
How to work out the customs value of your imports
There are 6 valuation methods that you can use to work out the customs value of your imported goods. You work through the appropriate method using the values that it describes and making adjustments, additions and deductions according to the guidance and your individual circumstances.
You must try to use Method 1 first. It’s the normal method of valuation and is used for over 90% of imports which are liable to ad valorum Customs Duty.
If you cannot use Method 1 then you must try Method 2.
If you cannot use Method 2 then you must try Method 3.
If you cannot use Method 3 then you must try methods 4 or 5. You can try Method 5 before Method 4 if you want to.
If you cannot use methods 4 or 5 then you must use Method 6.
If you use any of methods 2 to 6, we may ask you to explain why you have not used an earlier method.
Method 1 (transaction value)
This is the normal method of valuation and the first method that you must try to use. It’s based on price paid or payable by the buyer to the seller for the goods when they are sold for export to the UK.
Valuing imported goods using Method 1.
If you cannot use Method 1, you must try Method 2.
Method 2 (transaction value of identical goods)
Method 2 is based on the transaction value of identical goods exported to the UK at or about the same time as the goods being valued. To be identical, the goods must be:
- produced in the same country as the goods to be valued
- exported to the UK at or about the same time
- the same in all respects including physical characteristics, quality and reputation — minor differences in appearance do not matter
Valuing imported goods using Method 2.
If you cannot use Method 2, you must try Method 3.
Method 3 (transaction value of similar goods)
Method 3 is based on the price paid or payable for goods which are similar to the goods to be valued. Similar goods are goods which are different in some ways from the goods being valued but they:
- are produced in the same country
- can carry out the same tasks
- are commercially interchangeable
Valuing imported goods using Method 3.
If you cannot use Method 3, you must try methods 4 or 5. You can try Method 5 before Method 4 if you want to.
Method 4 (deductive method)
Method 4 is based on the selling price in the UK of the goods, identical goods or similar goods.
Under Method 4, you can use the simplified procedure values scheme rates for certain whole fresh fruit and vegetables imported on consignment. You can use these rate values if you do not have a transaction value for your goods and they meet the criteria for the scheme.
Valuing imported goods using Method 4.
Valuing imported fruit and vegetables using simplified procedure values.
If you cannot use Method 4, you must try Method 5.
Method 5 (computed value)
Method 5 is based on the costs of production of the imported goods. You use the total of the cost or value of materials and fabrication or other processing used in producing the goods. Usually this method can only be used if the importer and supplier are related in a business sense. You can find out if the buyer and seller are related for valuation purposes in ‘Method 1 (transaction value)’.
Valuing imported goods using Method 5.
If you cannot use Method 5, you can try Method 4 unless you have already tried it. If you cannot use Method 4 or Method 5 you must try Method 6.
Method 6 (fall-back method)
Method 6 is based on adapting methods 1 to 5 flexibly to fit unusual circumstances.
You must work out the customs value by using reasonable means consistent with the World Trade Organization (WTO) customs valuation principles on the WTO website.
Valuing imported goods using Method 6.
Goods entering or being removed from a customs warehouse
You must declare the customs value for statistical purposes when your goods enter a customs warehouse. This information is also used for warehouse stock control purposes.
You must also declare the customs value when your goods are removed from the customs warehouse into free circulation.
In both these cases you work through the appropriate valuation method using the values that it describes and making adjustments, additions and deductions according to the guidance and your individual circumstances.
For further advice you should contact imports and exports general enquiries.
What to do if you cannot establish the value for Customs Duty
You can ask for release of your goods by paying the undisputed charges outright and securing the balance by cash or cheque — we call this a deposit. When the value is agreed you may be asked to pay more duty or you may get a refund — we call this adjusting the deposit. If the deposit equals the amount of duty due, you’ll be told — we call this bringing the deposit to account.
As an alternative to a cash deposit, you may be able to use a guarantee, underwritten by a bank. For further information contact imports and exports general enquiries.
Evidence and keeping records
The evidence that you need to keep is described in the guidance for each method. You must produce any documents and information about your imports that a customs officer needs. You may also need to let a customs officer inspect or take extracts from any relevant document.
You must keep these documents and information for at least 4 years.
What to do if you disagree with a customs decision
If you do not agree with the decision issued to you, there are 2 options available:
- if you want a review, you should write back to the decision maker within 30 days of the date of letter, giving your reasons why you do not agree with their decision
- appeal direct to the tribunal who are independent of HMRC
If you choose to have your case reviewed, you’ll still be able to appeal to the tribunal if you disagree with the outcome.
Check Disagree with a tax decision.
