In guidance updated on October 21, 2026, the United Kingdom’s HM Revenue & Customs (HMRC) clarified how import value-added tax (VAT) should be calculated on imported goods. HMRC confirms that the value for import VAT is based on the customs value of the goods, plus applicable customs duties, taxes, and certain transport and related incidental costs.
The guidance also reiterates the use of Method 2, a simplified valuation approach that allows importers to apply standard UK incidental expense rates rather than declaring actual costs. Under Method 2, the following rates apply:
- £0.55 per chargeable kilogram (minimum £135) for airfreight consignments.
- A combination of £125 per tonne plus £110, with a minimum of £235 for groupage/consolidated surface freight shipments.
- £760 per full-load surface freight consignment.
The guidance encourages importers to review their customs valuation and import VAT calculation processes to ensure continued accuracy and compliance with HMRC requirements.
HMRC’s updated VAT guidance can be found here:
https://www.gov.uk/guidance/working-out-the-vat-value-using-the-customs-value-of-the-imported-goods
