Is VAT normally included/added to shipping costs in the UK?

[Dave2002]

I was somewhat disturbed/disappointed when trying to make an order this morning to discover that the £3.99 shipping costs which I was expecting for expedited delivery translated into rather more on checkout. I suspect that the supplier wanted to apply VAT to the shipping.

Is this normal?

At that point I decided to give up the order.

[Flosshilde]

Depends. According to this - https://www.gov.uk/guidance/rates-of...and-newspapers - Royal MAil is exempt from VAT, other postage/shipping services within the UK aren't, mostly. But I don't recall VAT being shown as an extra charge on shipping costs. Surely it would be better to show the full shipping cost (including VAT) up-front & then give a break-down in the final statement.

But VAT on 3.99 wouldn't be that much - less than 80p at standard rate.

[ahinton]

Depends. According to this - https://www.gov.uk/guidance/rates-of...and-newspapers - Royal MAil is exempt from VAT, other postage/shipping services within the UK aren't, mostly. But I don't recall VAT being shown as an extra charge on shipping costs. Surely it would be better to show the full shipping cost (including VAT) up-front & then give a break-down in the final statement.

But VAT on 3.99 wouldn't be that much - less than 80p at standard rate.

As you write, Royal Mail has so far been exempt from VAT whereas other shippers would not usually be so; however, the way that many shippers who use Royal Mail get around this is to call their "shipping charge" a "handling charge" on the whole of which they can (and invariably do) charge VAT. For example, I recently needed to order an oven lamp cover which had shattered but, although it would probably have cost no more than a few pence, is not supplied as a separate item and one has instead to order an entire lamp assembly unit (which is not even a user serviceable part) and detach the lamp cover from it for use; the charge for this unit is around £18 but by the time the suppliers had added their "handling charge" (which includes shipping) + VAT on the total, the amount was almost £28, yet I couldn't help but notice when receiving the item that it had been sent via Royal Mail whose shipping cost was just £3. Given that I would not even have needed to do this in the first place were it not for a design flaw in the appliance that makes access to the lamp and its cover well nigh impossible, I protested to the manufacturers and, after some argument, they agreed to fund the entire cost themselves although, as I'dhad to pay for it when ordering, this means a refund which, after 10 days, I notice has yet to be made.

[Keraulophone]

I always have to pay VAT on delivery when ordering wine.

Even worse is to have to pay VAT on the Duty!

Eg. Fine & Rare: "We deliver Monday-Friday and charges are £16 + VAT for up to 10 cases".

[Dave2002]

Depends. According to this - https://www.gov.uk/guidance/rates-of...and-newspapers - Royal MAil is exempt from VAT, other postage/shipping services within the UK aren't, mostly. But I don't recall VAT being shown as an extra charge on shipping costs. Surely it would be better to show the full shipping cost (including VAT) up-front & then give a break-down in the final statement.

But VAT on 3.99 wouldn't be that much - less than 80p at standard rate.

Agree that the additional extra is not that much, but it was sufficient to make me think that maybe I didn't need the order that urgently (free postage is offered with a longer lead time). Also, there is a slight issue given what you have written, in that the £3.99 was indicated as being Royal Mail special delivery - so shouldn't that have been exempt? I think the delivery would have been from within the UK.

Actually I think the link you provided gives the answer - see:

Postage, packing and delivery within the UK included in the sales contract but charged for separately, eg mail order The same rate as the goods being delivered or posted Postage, packing and delivery within the UK charged as an optional extra is always standard-rated - VAT Notice 700/24

I'm not quite sure what effect, or otherwise, the phrase "included in the sales contract ..." has - that's obscure to me.

[Flosshilde]

Doen't neccessarily mean they are charging VAT on the duty - do they itemise the VAT on the receipt?

(Reply to Keraulaphone, no. 4)

[mangerton]

Doen't neccessarily mean they are charging VAT on the duty - do they itemise the VAT on the receipt?

(Reply to Keraulaphone, no. 4)

I can confirm that VAT is charged on alcohol duty. Similarly with petrol. It's the last thing on the invoice, and is calculated on the invoice total. More info here.

See here for info on postage and delivery.

Scroll down on these links as required.

[vinteuil]

I can confirm that VAT is charged on alcohol duty...

... yes : you soon learn this if you buy wine in bond

https://en.wikipedia.org/wiki/En_primeur

But then, when it does finally arrive chez soi -
why! you've forgotten all about the expense incurred all those years previously -
and the wine is (well, seems to be) absolutely 'free' ...



Tomorrow I'm taking delivery of some crates of claret bought en primeur back in 2009/2010...

[mangerton]

... yes : you soon learn this if you buy wine in bond

https://en.wikipedia.org/wiki/En_primeur

But then, when it does finally arrive chez soi -
why! you've forgotten all about the expense incurred all those years previously -
and the wine is (well, seems to be) absolutely 'free' ...



Tomorrow I'm taking delivery of some crates of claret bought en primeur back in 2009/2010...

Some crates? Santé! I suppose after a bottle or two you've forgotten all about everything.

[ahinton]

I can confirm that VAT is charged on alcohol duty. Similarly with petrol. It's the last thing on the invoice, and is calculated on the invoice total. More info here.

See here for info on postage and delivery.

Scroll down on these links as required.

Indeed. The crucial bits are:

Direct-mail postal services meeting all the conditions of VAT Notice 700/24 3.2 and 3.3 Outside the scope of VAT VAT Notice 700/24

and

Public postal services provided by the Royal Mail under a universal service obligation Exempt

So if goods are being shipped via Royal Mail, no VAT is chargeable on the shipping costs, which is why (as I outlined above) what suppliers using theit services do to get around this is quote a "handling charge" that includes shipping (even if that's done by Royal Mail) and charge VAT on the whole.

[Dave2002]

Similarly with petrol. It's the last thing on the invoice, and is calculated on the invoice total. More info here.

See here for info on postage and delivery.

Do you often buy petrol by mail order?

[mangerton]

Do you often buy petrol by mail order?

Never. It's a prohibited item.

I thought my response to Flosshilde's question regarding VAT on duty was quite clear. Please accept my apologies for any confusion.

[Dave2002]

Never. It's a prohibited item.

I thought my response to Flosshilde's question regarding VAT on duty was quite clear. Please accept my apologies for any confusion.

Of course. I was merely being naughty.

[mangerton]

Of course. I was merely being naughty.