Freight Shipping between UK and Portugal | Rates – Transit times – Duties and Taxes

How to calculate duties & taxes when importing from UK to Portugal?

When it comes to estimating duties and taxes for importing goods from the UK to Portugal, several variables come into play.

These include the country of origin, the Harmonized System (HS) code of your goods, the customs value, the applicable tariff rate, and the consideration of any additional taxes or fees that may apply to the products. Each element plays a critical role in determining the total cost of importation.

The first piece of this complex puzzle is identifying the country where your goods were manufactured or produced, as this directly influences the duty rates applied to your shipment.

Step 1 - Identify the Country of Origin

Identifying the Country of Origin, a task seemingly rudimentary, paves the way for successful shipping. Here's why:

1. Precision: The correct HS code, critical for estimating duties and taxes, relies on this detail.
2. Trade Agreements: UK and Portugal share cordial trade terms under the EU-UK Trade and Cooperation Agreement, influencing tariff rates.
3. Duty Preferences: Depending on origin, goods can qualify for duty exemptions under certain trade regulations.
4. Import Rules: Regulations often hinge the country of origin, along with product nature.
5. Compliance: Correct origin listing prevents shipping hiccups, saving time and money.

Be aware of restrictions on specific commodities. For instance, alcohol products require a specific license.

Your bottom line - don't skim on this first step. It could mean the difference between smooth sailing and a shipping gridlock. A careful start paves the way for a stress-free transit - from UK to Portugal, and further.

Step 2 - Find the HS Code of your product

The Harmonized System (HS) Code is a universally accepted system that classifies traded products. It was developed by the World Customs Organization (WCO) and is used by customs authorities around the world to identify and classify goods for the purpose of taxation, import and export control, and customs handling.

Your product's HS code is vital in the logistics process. Typically, your supplier could provide you with the accurate HS code for the product they handle as they are usually familiar with relevant regulations. If asking the supplier isn't an option, don't worry! We have an easy, step by step process to guide you.

The first step is to utilize an HS lookup tool. One such resource is the Harmonized Tariff Schedule. This tool simplifies the whole process.

Once there, you'll search for your product in the search bar, which will generate a list of potential matches.

The next step is to check the Heading/Subheading column. This is where you'll find your product's HS code.

Now, a word of caution. It's important to ensure the accuracy of the HS code you select. An incorrect code could lead to the misclassification of your goods, causing shipping delays and potential fines.

And just to make the whole process clearer for you, here's an infographic showing you how to read an HS code. Continue reading to stay informed and make your shipping process smooth and hassle-free.

Step 3 - Calculate the Customs Value

Calculating the Customs Value can often seem confusing, but in reality, it's pretty straightforward. The Customs Value, unlike the product price, doesn't only account for the value of the goods. It's actually known as the CIF (Cost, Insurance, Freight) value.

This is a crucial term in worldwide logistics - CIF value is the total cost of 'Product Price + International Shipping Cost + Insurance Cost'.

Let's say you've bought machinery from the UK for $2,000. The international shipping costs are $400 and you've paid $100 for insurance. Your CIF value becomes $2,500 ($2,000 + $400 + $100 = $2,500). This $2,500 is what Portuguese customs use to determine any duties owed, not the original $2,000.

So, planning your budget and keeping the CIF in mind could save you from unexpected costs.

Step 4 - Figure out the applicable Import Tariff

An import tariff is a tax imposed by a government on goods imported from another country. It is used to regulate trade and protect domestic industries. For Portugal, tariffs are calculated based on a Customs Duty that's specific to every product category.

You can find the tariff for your product by using UK's trade tariff tool. Follow these steps:

1. Enter the HS (Harmonized System) code you previously identified into the tariff consultation tool.
2. Indicate the country of origin, which in this case is the UK.
3. Check the duties and taxes applied to your product.

Let's use an example for a clearer understanding. Say we're importing a bicycle (HS code: 871200) from the UK. From the UK's trade tariff tool, we find a rate of 14%. Assuming the cost, insurance, and freight (CIF) value is $700, calculate the import duties as follows: Import duties = Tariff rate CIF value = 14% $700= $98.

So the total cost to import the bicycle to Portugal would be the CIF value + the import duties, which is $700 + $98 = $798.

Remember, it's essential to correctly identify your HS code and use the right tools to avoid unexpected costs and delays.

Step 5 - Consider other Import Duties and Taxes

Keep in mind, besides the standard tariff duty, you could face additional import duties depending on the country of origin and the type of product. This could include excise duty typically imposed on products like alcohol, tobacco, or fuel. Or, anti-dumping taxes applied to protect EU manufacturers against goods sold at under their market value.

Take, for example, if you import a batch of wine valued at $10,000. For this, you could face an excise duty (say 5% as an illustrative figure; actual rates may differ). So, you'd need to account for $500.

Most importantly, you must consider the Value Added Tax or VAT. In Portugal, the standard rate is 23%, applied to the product cost plus the tariff and any other duties. For our wine import, if the tariff was $100, you calculate VAT on $10,600 ($10,000 + $500 + $100), resulting in $2,438.

Remember, don't forget these costs when calculating your importing expenses - they can add up significantly!

Step 6 - Calculate the Customs Duties

Calculating customs duties in Portugal when importing goods from the UK can initially be perplexing, but don't worry, here's a simplified breakdown!

For goods attracting customs duties but not VAT, you'll use this formula: Customs Duty = Customs Value x Duty Rate. For example, if your consignment is valued at $5,000 and the duty rate is 10%, your customs duty would be $500.

For deliveries attracting both customs duties and VAT, you add the VAT to the sum above: Total = Customs Duty + (Customs Value + Customs Duty) x VAT rate. Suppose the VAT rate is 20%, the overall cost for your $5,000 consignment would be $600 + ($5,000 + $600) x 20% = $1,320.

Lastly, for cargo attracting anti-dumping taxes or Excise Duty, you expand the previous formula: Total = Customs Duty + (Customs Value + Customs Duty + Anti-dumping tax/Excise Duty) x VAT rate. Let's say you have an added anti-dumping tax of $200 on your $5,000 shipment. Hence, $600 + ($5,000 + $600 + $200) x 20% = $1,480.

By calculating duties accurately, you avoid unnecessary fees, keep your budget on track, and ensure seamless customs clearance. Still finding it overwhelming? At DocShipper, we excel at handling every step along the clearance path, guaranteeing you're not overcharged. Drop us a line for a free quote in under 24 hours. We're here to simplify your global shipping process!

Bill of Lading

The Bill of Lading (BOL) is your best friend if you're shipping goods between the UK and Portugal. Acting as a receipt issued by the carrier, it's a critical confirmation that your cargo has been loaded. Think of it as your 'proof of purchase,' marking the all-important transition of ownership.

Here's where it gets exciting—opting for a 'telex' (aka electronic) release can speed up the process. Instead of waiting for a physical copy, you get your Bill of Lading digitally, leading to a faster, smoother customs clearance. Yep, it's as cool as it sounds! For air shipments? The Air Waybill (AWB) plays the same role. Bottom line: Be it the high seas or the wide skies, never undervalue the power of a Bill of Lading or an AWB. It's your key to a hassle-free shipping experience between the UK and Portugal.

Packing List

Imagine the Packing List as your shipment's guide between the UK and Portugal. It's your responsibility to create this document, and precision is key. With every product's description, quantity, and weight accurately outlined, the Packing List ensures a smooth transit, whether by sea or air. Think of it as a cross-check for customs officers allowing them to confirm the contents versus the declared value.

For instance, if you're shipping a palette of pottery, an accurate packing list helps avoid discrepancies that could cause delays. When shipping methods or even countries change, your Packing List remains a constant, guiding your shipment to successful delivery. Keep your goods moving by keeping your packing list accurate.

Commercial Invoice

A Commercial Invoice forms the backbone of your customs clearance when shipping goods between the UK and Portugal. It's not just a bill, but also your declaration to customs authorities, detailing what precisely you're shipping. It must mirror information on other shipping documents like Bill of Lading or Airway Bill to avoid discrepancies leading to potential delays.

Ensure to feature important details like sender's and receiver's contact information, description of goods, Harmonized System (HS) codes, and their value. Remember, an accurate Commercial Invoice not only streamlines the customs process but mitigates potential duty charges inaccuracies. So, double-check the invoice and keep everything aligned for smoother shipping.

Certificate of Origin

Are you shipping goods from the UK to Portugal? The Certificate of Origin plays a big role! This document verifies the country in which your goods were manufactured, a crucial detail for customs. Let's say your cargo includes pots made in Sheffield.

Your Certificate of Origin indicates 'United Kingdom' as the country of manufacture – a small detail with big implications!

It could open doors to preferential customs duty rates, making your shipment cost-effective. Don't overlook this small yet mighty document, it might be the key to simplifying your UK-Portugal shipping endeavors.

Certificate of Conformity (CE standard)

The Certificate of Conformity (CE standard) is a critical document to have when shipping goods between the UK and Portugal. This certification states that your product meets European safety, health, and environmental protection standards.

A bit different from quality assurance, which focuses more on the process of producing a product, the Certificate of Conformity (CE standard) is your ticket to ensuring that your goods clear customs smoothly and are ready to be sold on the European market.

But don't confuse it with the US’s FCC Declaration of Conformity. They may sound similar, but in reality, they serve different markets. Since Brexit, the UK uses its own marking, UKCA.

Find more information on the UK government's website. Ignore the notion that this document isn't necessary: this is a must-have to avoid hitches at customs. An easy way to think of this: you wouldn't attempt to drive without a license; this certificate should be thought of in the same light.