[h=2]3.4 Prepayment of import VAT on goods purchased over the internet or by mail order[/h]HMRC has special arrangements that allow some overseas traders to charge, collect and pay over to us the import VAT for goods purchased by mail order, that would normally be chargeable at the time the goods are imported. These arrangements operate under Memoranda of Understanding (MoU) signed with certain overseas customs and postal authorities. The countries that have a MoU with HMRC are - the Channel Islands, Hong Kong, Singapore and New Zealand. Overseas traders wanting to use this procedure must be authorised to do so by their authorities.
Once authorised, foreign businesses are issued with a unique authorisation number, which they must show on the customs declaration or packaging. They will include the statement 'Import VAT Prepaid'.
Where these arrangements are used you will not be charged a Royal Mail handling fee when you receive your package.
If you are a VAT registered business and purchase goods for use in your business you should keep the outer wrapper and invoice from the supplier to support your claim to input tax.