The hidden costs in gifts

Remember I sent Piers a parcel a few weeks ago? In it were an iPad 2 case and an Angry Birds stuffed toy.

Yesterday, he got slapped with an invoice by the courier company for £25.

And it wasn’t even for courier services. It was for gift tax and deferment proc fee!






The gift was worth S$103 (£50).

In the UK, when you receive goods above £38 from overseas, you have to pay 20% VAT (equivalent of our GST). Doesn’t matter whether it’s a gift or a purchase; you have to pay tax for it.

(Shouldn’t they warn gift senders about this at the post office?)

Usually, the recipient would receive a note to collect his gift at the post office and make payment then.

For Piers’ parcel, maybe because I had paid premium postage so he could get it sooner, courier company TNT was tasked to deliver the package to him.

They presumed to pay the £10 on his behalf, then slap him with a £25 bill two weeks later.

£10 for the VAT.
£15 for helping him pay the VAT first.

So he ends up having to pay £25 for receiving a £50 gift!






Firstly, being slapped with VAT for a gift is already bad enough.

What if some well-meaning rich friend sent you a £3,000 monstrosity of a gift (like maybe some ugly antique ornament) and you ended up having to pay £600 tax for something you can’t even sell off because nobody can bear to look at it?

On top of that, to be slapped with a service fee for a service you didn’t request! And not at all warned about it!

It’s a small amount to be sure, but it’s so annoying when big companies exploit people like that! How much money do they make invoicing people like that every day?

Piers tried calling TNT this morning to talk about it but no one answered the phone.

What kind of a shady operation is that!


Little girl


Anyway, I felt really bad about the whole thing and wanted to pay the fees but he refused to let me. Even refused to let me buy him a nice meal to make up for it.

He wasn’t even going to tell me about it in the first place. But today, I said I didn’t have anything I wanted to blog about so he thought maybe this would give me something to blog about.

I’ll say!

I don’t like to rant on my blog too much but I think this is something useful for people to know. Especially for people who intend to send presents to your UK friends. Know that your friend will have to pay for the gift!

2 thoughts on “The hidden costs in gifts

  1. Avatar

    Happens in Netherlands as well.. gifts are indeed taxable! And yes I felt exactly the same way u felt just over a year back… haha

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