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The UK is removing the £135 low-value import duty relief and, on June 23, 2026, accelerated the deadline to October 2028 at the latest. New customs arrangements shift duty, VAT collection, and liability onto sellers and marketplaces.
For years, consignments valued at £135 or less have entered the UK free of customs duty. That relief is being removed. Announced at Autumn Budget 2025 with an original date of March 2029 at the latest, the reform was brought forward six months on June 23, 2026, to October 2028 at the latest. On July 13, 2026, HMRC published draft legislation as part of the Finance Bill 2026-27, the vehicle that turns the policy into law.
This is one of the biggest changes to UK e-commerce customs since VAT moved to point of sale in 2021.
What actually changes
- The £135 duty relief will be removed. Customs duty applies to most low-value consignments sent by a business to a UK business or consumer.
- Liability shifts to sellers and online marketplaces. Duty and VAT are collected at the point of sale, added to the product price at checkout.
- Overseas sellers without a UK presence must appoint a UK fiscal representative who carries joint and several liability for the customs debt.
- BIRDS bulk declarations retire. Every qualifying parcel becomes a formal import event with item-level data, HS classification, and duty calculation.
- Duty is remitted quarterly, mirroring the VAT return cycle, rather than parcel by parcel.
- A simplified tariff structure that groups products into duty brackets is under consideration.
A few things stay put. VAT already applies to all low-value imports and has since 2021. The £39 relief on non-commercial gifts between private individuals remains, and consumer-to-consumer parcels keep following the standard import process.
Why this is bigger than a new duty line
The duty itself is the smallest part. The heavier lift is compliance: item-level data on every parcel, a fiscal representative on the hook for your customs debt, quarterly remittance, and a formal import event where a bulk declaration used to cover it. Miss any piece and parcels stall at the border or penalties land on the representative you appointed. Even goods that clear at a 0% rate still carry the full compliance requirement.
The fix is guaranteed DDP
FlavorCloud already operates as a compliant OMP and meets these requirements today. It handles UK VAT registration, reporting, and remittance for low-value imports, and with guaranteed DDP the duty, VAT, and every customs fee are calculated at checkout and paid once. Nothing is collected at the door. Nothing sits in a depot while a customer decides whether to pay. When item-level data and quarterly duty remittance become mandatory, they are already how the platform runs.
Key dates
- Nov 26, 2025: Autumn Budget announces removal of the £135 relief
- Nov 26, 2025 to Mar 6, 2026: public consultation
- June 23, 2026: deadline accelerated six months to October 2028; consultation response published
- July 13, 2026: draft legislation and policy paper published (Finance Bill 2026-27)
- Through Dec 31, 2026: existing £135 relief continues
- By October 2028: relief removed, new customs arrangements live
From surviving the change to compounding growth
Most brands run international at 10 to 20% of revenue. The ones winning globally reach 40 to 60%, and it becomes their most defensible, compounding channel. That gap closes when compliance is treated as infrastructure rather than a fire drill. On top of that infrastructure, FlavorCloud's Commerce Intelligence layer maps the markets with the strongest upside and sets SKU-level prices that convert while protecting margin, tuned as the rules move. A change like the LVI reform becomes one more input the system already accounts for.
If you ship into the UK, moving to guaranteed DDP on a compliance-ready, AI-native Cross-Border Commerce OS is worth doing before the item-level data and fiscal-representative rules take hold.