News for Importers and Exporters: Changes in VAT Exemption of Shipped Goods
Without customs duty is not the same as without VAT
To date imported shipments of goods with a value of less than EUR 150 have been exempt from customs duty and also from VAT. While the exemption limit for customs duty will remain at EUR 150, the exemption limit for VAT decreases to EUR 22. In practice, this means that:
- Shipments of goods with a value up to 22 EUR will be exempt from customs duty and VAT;
- Newly: shipments of goods with a value greater than EUR 22 and not exceeding EUR 150 are exempt from customs duty and subject to VAT; and
- Shipments of goods with a value over EUR 150 are subject to customs duty and VAT.
The value limits relate to the total value of the shipment, which includes the price of the goods only, excluding all postal fees or transportation costs. In addition, it is necessary to specify that the exemption from customs duty and VAT does not relate to the importation of alcoholic beverages, perfumes, eau de toilettes, tobacco and tobacco products.
This change will have an impact predominantly on persons who shop on the Internet and order goods from shops located outside the EU. It will have the same impact on businesses importing, for example, spare parts for machinery. Regardless of the date of the order, shipments received on 1 April or later will be subject to the lower VAT exemption limit. VAT non-payers will receive a tax assessment from the customs authority, while VAT payers should assess the tax themselves and retain a tax document – an import customs declaration, in any form.
Exemption for imported goods in personal luggage remains the same
For the sake of completeness, we should mention that the exemption of goods imported in travellers’ personal luggage is not impacted by the amendment to the VAT Act. The following goods continue to be exempt both from customs duty and from VAT:
- Goods carried in airplane passengers’ luggage with a value up to EUR 430; and
- Goods carried in the luggage of passengers travelling by other means of transport with a value up to EUR 300.
What does this mean for you?
Shipments of goods with a value not exceeding than EUR 22 that are sent from non-EU countries are exempt from customs duty and VAT.
Shipments of goods with a value greater than EUR 22 and not exceeding EUR 150 are exempt only from customs duty and not from VAT starting 1 April. VAT non-payers will receive a VAT assessment from the customs authority, while VAT payers should self-assess the tax.
Shipments of goods with a value over EUR 150 are subject to the common import regime and are subject to both customs duty and VAT.