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Certain donated goods can be imported free of VAT, from outside the Customs Union of the European Union (EU), by charities and other not-for-profit organisations.
The goods have to be any of the following:
There are also special procedures for relief from VAT on the import of goods to help deal with disasters in the Customs Union.
This guide explains how your organisation can import goods free of VAT, what goods you can import and how you can use them.
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Normally if you import goods from outside the Customs Union of the EU, you have to pay import duty and VAT. However, some donated goods can be imported free of VAT, if they are imported by a charity or certain other types of qualifying organisation, and providing that there is no commercial intent by the donor.
You can import goods free of VAT if you are:
You can also qualify to import goods free of VAT if you are one of the following organisations, and you are run on a not-for-profit basis, and your objective is the welfare of the needy:
There are also reliefs from VAT when importing certain goods for disabled people. These are available to organisations principally concerned with the education of or the assistance to disabled people that HM Revenue & Customs (HMRC) has already approved to receive the goods duty free, or to disabled people importing the goods for their own use.
To take advantage of the VAT reliefs for charities you must hold evidence that your organisation is registered with the Charity Commission for England and Wales. If it is not registered with them - for example, if it is exempt from registration with the Charity Commission or is a Scottish or Northern Ireland charity - then it must have evidence that it has been formally recognised as a charity by HMRC for tax purposes.
Goods only attract this relief from VAT if they:
The goods that can be imported VAT-free are:
See the sections below for more detail on each of these.
There are also special procedures for relief from VAT on goods imported to help deal with disasters in the Customs Union. You'll need to contact HMRC to discuss these. The relief from VAT does not apply to materials and equipment intended for rebuilding disaster areas.
Basic necessities are goods that will be distributed free of charge to meet the immediate needs of needy people in the Customs Union or overseas. They include:
You'll only get relief from VAT if the goods were donated to you in the first place. You'll get relief from duty regardless of whether you paid for them or not.
Most imported goods that you use or sell at charity events qualify for VAT relief provided that:
Service industry machines, tools and equipment, office materials, and fixtures and fittings qualify for relief provided that you receive them:
The following imported goods aren’t eligible for relief from VAT:
In addition, HMRC may limit the quantities or kinds of goods that you can import to avoid any abuse or distortion of competition, and there are general restrictions on importing specific types of goods.
If you import goods valued at £600 or less in your accompanied baggage, you must declare them to customs when you arrive, and produce evidence to satisfy us that you are eligible for the relief.
If the goods you are importing are worth more than £600, or if you are importing the goods as freight, you must claim relief by completing an import declaration on a Single Administrative Document (SAD) (form C88).
You will need to enter one of the special Customs Procedure Codes (CPCs) in box 37 of the SAD to claim the relief - see below.
If you are importing goods by post you should ask the sender to write 'CHARITY ITEMS: RELIEF CLAIMED' on the package and its accompanying international customs declaration.
If the package is not clearly marked it may not be delivered until you have paid the Customs Duty and VAT. You should pay these charges and then write to customs at the postal depot where the charges were raised. Your letter must explain what happened, how the goods will be used and enclose the document showing the charges. If customs are satisfied that you qualify for relief, they will repay the Customs Duty and VAT.
You should normally claim relief at the time you import the goods. However, subject to certain conditions, HMRC may accept a belated claim and repay the appropriate charges.
You’ll need to use one of the following CPCs:
CPC 40 00 C20 is used for goods imported by an approved charity or philanthropic organisation for that includes:
Note that relief can’t be claimed on alcoholic products, tobacco products, coffee, tea and motor vehicles other than ambulances.
CPC 40 00 C26 is used for the importation of goods for the benefit of victims of a disaster affecting the territory of the European Community or countries with which it has a customs union, imported by an approved charitable or philanthropic organisation or disaster relief agency for which relief from import duty and VAT is claimed.
The goods must be:
Note: relief can not be claimed on materials and equipment intended for rebuilding disaster areas.
You don’t have to pay Customs Duty or VAT when you distribute goods that you imported VAT-free as basic necessities for needy people, or to help deal with disasters within the Customs Union.
You may also lend, hire out or transfer any VAT-free imported goods to another approved organisation without payment of Customs Duty and VAT as long as you notify HMRC first.
You may also sell any VAT-free imported goods at charity events without payment of Customs Duty and VAT providing this is to raise funds for the organisation, and that you meet the conditions described in the earlier section ‘Which goods are covered’.
You must pay Customs Duty and VAT if you dispose of the goods for any other purpose. HMRC may visit you to confirm that you're complying with the conditions for this relief.
For more help you can contact HMRC Charities by phone, email, or post.