AliExpress Import Tax UK and EU VAT: The 2026 Rules
Quick answer: In the UK, AliExpress adds 20% VAT at checkout on orders up to £135; above that, import VAT and customs duty are collected at the border. In the EU, VAT applies to every order, and since 1 July 2026 a €3 customs duty applies per item type on parcels under €150.
Key takeaways
- The £135 and €150 lines are about duty, not VAT. VAT is due on everything you import into the UK or the EU. The thresholds only decide who collects it and whether customs duty is added on top.
- The EU's duty-free window closed on 1 July 2026. The €150 customs duty exemption was abolished and replaced with a temporary flat duty — €3 per item, running until 1 July 2028, when classification-based tariffs take over.
- €3 is charged per tariff line, not per parcel. A basket of five different product types can carry five separate €3 charges, so mixed "random gadget" baskets are hit hardest.
- The UK is next. HMRC confirmed in a July 2026 policy paper that the £135 low value import relief will be removed by October 2028 at the latest.
- Import tax is never refundable through cashback. Cashback and rebates apply to the goods value, not to VAT, duty, or courier handling fees — so model landed cost, not sticker price.
How does AliExpress import tax work in the UK?
UK import tax on an AliExpress order is decided by one number: the intrinsic value of the goods in a single consignment, excluding shipping and insurance. Below £135 the marketplace handles the tax; above £135 the border does.
Orders of £135 or less
For consignments valued at £135 or under, AliExpress charges UK VAT at 20% at the point of sale and remits it to HMRC. There is no customs duty, and nothing further should be collected on delivery. This is why the price you see at AliExpress checkout with a UK delivery address is usually higher than the price advertised on the product page — the VAT has been folded in.
One detail most buyers miss: the £135 test is on goods value only. A £130 order with £12 shipping stays under the threshold, because shipping is excluded from the valuation.
Orders over £135
Above £135, the marketplace steps out and the normal import process applies:
- Import VAT at 20% on the goods, plus shipping and insurance, plus any duty.
- Customs duty at the rate for that commodity code — commonly 0–12% for consumer goods, with clothing and footwear at the higher end. Duty is not charged if the calculated amount comes to less than £9.
- A courier handling fee — typically £8–£12 — for advancing the tax and filing the declaration. This is a private charge, not a tax, and it is not refundable.
The parcel is held until you pay, which is a common and avoidable cause of delay. If you are already tracking a slow parcel, our guide to how long AliExpress shipping actually takes covers where customs sits in the timeline.
The B2B exception worth knowing
If you buy as a VAT-registered business and enter a valid UK VAT number, the seller of a ≤£135 consignment should not charge VAT at checkout. Instead you account for it yourself through the reverse charge on your VAT return — cash-flow neutral if you can reclaim it. Above £135 you reclaim import VAT using your monthly C79 certificate instead. Dropshippers frequently pay unnecessary VAT here simply because the VAT number field was never filled in.
What changed in the EU on 1 July 2026?
The EU abolished the €150 customs duty exemption on 1 July 2026. Every parcel entering the EU from outside now carries customs duty, regardless of how cheap it is.
Because classifying hundreds of millions of small parcels correctly is not yet feasible, the Council agreed a transitional simplification: a flat duty of €3 on low-value consignments, in place until the EU Customs Data Hub goes live in 2028, after which standard tariff rates based on HS code and origin resume.
Three details determine what this actually costs you:
- Per tariff line, not per parcel. "Item" means goods sharing a tariff classification, description and origin. A parcel with a silk blouse and two wool blouses counts as two items and owes €6.
- Legally owed by the declarant. The duty sits with the seller or IOSS holder rather than the recipient, but in practice platforms pass it through — reporting since 1 July has focused on the charge landing on AliExpress, Temu and Shein baskets at checkout.
- VAT is unchanged. Under IOSS, sellers charge local VAT at checkout on consignments up to €150; without IOSS the carrier collects VAT on delivery, usually with a handling fee.
An EU-wide handling fee for processing these parcels has been discussed but not adopted — the amount and start date are still to be determined. Treat any figure you see quoted for it as a proposal, not a rule.
UK vs EU AliExpress import tax compared
| United Kingdom | European Union | |
|---|---|---|
| VAT rate | 20% | 17–27% depending on member state |
| VAT on low-value orders | Charged at checkout on goods ≤ £135 | Charged at checkout via IOSS on goods ≤ €150 |
| Customs duty on low-value orders | None below £135 (relief still in force) | €3 per tariff line since 1 July 2026 |
| Above the threshold | Import VAT + duty by commodity code, collected by courier | Import VAT + duty by commodity code, collected by courier |
| Duty waiver | Duty not charged if it works out under £9 | No de minimis remaining |
| Courier handling fee | Typically £8–£12 on border-cleared parcels | Typically €5–€15, varies by carrier |
| Next change | £135 relief removed by October 2028 | Standard tariff rates replace the €3 flat duty in 2028 |
What does a typical order actually cost?
Worked examples, using goods value only and ignoring courier fees where nothing is collected at the border:
| Order | UK landed tax | EU landed tax (20% VAT country) |
|---|---|---|
| One £20 phone case | £4 VAT at checkout | €4 VAT + €3 duty |
| Five different £8 accessories, one parcel | £8 VAT at checkout | €8 VAT + up to €15 duty (5 tariff lines) |
| Ten identical £8 accessories, one parcel | £16 VAT at checkout | €16 VAT + €3 duty (1 tariff line) |
| £300 of clothing | £60 import VAT + up to ~£36 duty + handling fee | €60 import VAT + duty by code + handling fee |
The middle two rows are the important ones for EU buyers. Same money spent, same parcel count — but variety now costs more than volume. Sampling ten different products in one order is the single most expensive shopping pattern under the new rules.
How do you keep the landed cost predictable?
- Filter by "Ships from" your own region. Stock already sitting in a UK, Spanish, Polish or German warehouse has cleared customs. No duty event, no handling fee, no held parcel — usually a few percent more on the sticker price and far less variance.
- Group by product type, not by shopping trip. In the EU, ten of the same item in one parcel is one €3 charge. Ten different items is up to ten. Order sample runs by category.
- Check the goods value against the threshold before adding shipping. A £138 basket becomes a border clearance; trimming it to £134 does not.
- Enter your VAT number if you are a registered business. Reverse charge on low-value consignments, C79 above the threshold. This is the largest recoverable amount most sellers leave on the table.
- Never ask a supplier to undervalue the parcel. It is customs fraud in both the UK and the EU, it voids the platform's buyer protection on the declared amount, and seizure risk sits with you as the importer.
- Price your product on landed cost. Goods + shipping + VAT + duty + handling, then margin. Sticker-price maths is how thin dropshipping margins quietly turn negative.
None of the above removes the tax itself — nothing legally does. The one lever left is the goods value, which is where sourcing negotiation, warehouse selection and rebates apply. If you buy on AliExpress regularly, a cashback tool like Refundy returns a share of that goods value (currently up to 11%) after the order is confirmed, which is one of several ways to offset the extra €3-per-line and handling fees now baked into cross-border buying. It does not apply to the tax portion — see the full AliExpress cashback guide for how rates and exclusions work.
What is changing next?
United Kingdom. Following a consultation that ran from December 2025 to March 2026, HMRC confirmed the removal of the £135 low value import relief, with implementation brought forward to October 2028 at the latest. Low-value consignments will move into a dedicated regime with a reduced data set and a "fiscal representative" — a UK-based business carrying liability for an overseas seller's customs debt. In practice: expect duty on cheap parcels, and expect overseas sellers to price it in.
European Union. The €3 flat rate is explicitly temporary. Once the EU Customs Data Hub is operational in 2028, duty returns to real tariff classification, which will be higher than €3 on some categories and lower on others. The separate handling fee proposal remains undecided.
What this means for planning. The duty-free small parcel era is ending on both sides of the Channel. Sourcing models built on sub-€150 direct-to-consumer shipments — most classic dropshipping — carry a structural cost increase that is now legislated rather than speculative. Margins should be recalculated on landed cost before Q4, not after. If a supplier dispute has already eaten into a batch, our AliExpress refund and dispute guide covers recovering the goods value before you write it off.
Frequently asked questions
Do I pay import tax on AliExpress orders to the UK?
Yes. On orders of £135 or less, AliExpress charges 20% UK VAT at checkout and there is no customs duty. Above £135, the courier collects import VAT plus any customs duty at the border, along with a handling fee of roughly £8–£12. There is no order value small enough to be VAT-free.
What is the €3 AliExpress customs charge in the EU?
It is the transitional customs duty that replaced the €150 duty exemption on 1 July 2026. It applies at €3 per item type — goods sharing a tariff classification, description and origin — on consignments up to €150, and runs until 1 July 2028, when classification-based tariff rates resume.
Does the £135 threshold include shipping costs?
No. The threshold is based on the intrinsic value of the goods, excluding transport, insurance and any tax. A £130 order with £15 shipping is treated as a £130 consignment and stays inside the relief.
Can I avoid AliExpress import tax legally?
You cannot avoid the tax, but you can avoid the border event by buying stock that already ships from a warehouse in your country, and you can reduce duty exposure in the EU by keeping the number of distinct tariff lines per parcel low. Asking a supplier to declare a lower value is customs fraud, not a workaround.
Can VAT-registered businesses reclaim AliExpress import VAT?
Generally yes. For UK consignments over £135, reclaim import VAT using the monthly C79 certificate. For consignments of £135 or less, supplying a valid VAT number at checkout should stop VAT being charged at all, with the reverse charge applied on your return instead. Rules vary by member state in the EU — confirm with your accountant.
Does cashback apply to the tax I pay?
No. Cashback and rebate programmes are calculated on the goods value only. VAT, customs duty, shipping and courier handling fees are excluded, so treat cashback as a reduction in product cost rather than a rebate on landed cost.
Images: Photo by Claudio Schwarz on Unsplash · Photo by Fotos on Unsplash.
This article is general information, not tax advice — thresholds and rates change, and EU rules vary by member state. Refundy is a free Chrome extension that gives cashback on AliExpress, Alibaba.com, 1688, and Taobao. Cashback excludes shipping, fees, taxes, and split payments, and 1688 cashback requires activation via customer support — see the cashback terms for details.