Her Majesty's Revenue and Customs (HMRC) has announced that, from 1st January 2013, the VAT relief for gifts will be reduced from £40 to £36. The decision to amend the VAT relief follows HMRC's annual revalorisation of the euro against the pound sterling.
Following the removal of Low Value Consignment Relief (LVCR) in April this year, all commercial items sold and sent through the post into the UK are now liable for VAT. Gifts up to the value of £40 have previously been exempt from VAT. However, this limit has now been reduced and from 1st January 2013, VAT must be paid on all gifts over £36 or the recipient will be charged the appropriate amount in addition to a handling fee.
Leaflets detailing the change to the VAT limit for gifts will be available shortly in your local post office. Alternatively, for more information, please call a member of Guernsey Post's customer services on 711720.
*A gift is defined by HM Revenue and Customs as an item sent between two private people, is of occasional nature such as a birthday or Christmas gift and where no monetary consideration has been made.