Freight and Duty Rates

If you're new to estimating and reconciling freight and duty to goods coming into the UK, use the following proven guides to help you calculate the % to add to your material costs.

Ex-Works

If you buy Ex-Works, you are responsible for all freight movement of the goods and any import duty, if your supplier is outside the European Union. Don't forget to include any road transport costs for delivering goods to the Port of exit, plus from the port of arrival to your site. Use 5% for UK road costs to deliver from the UK Port to your site (based on an average of 300 miles of road freight).

Duty

Use 6% as the typical import duty rate for all countries outside the EU.

EU Road Costs

If Ex-Works from within the EU, then use 10% as an adder for all road/ferry deliveries from the EU to your site. Duty is not applicable.

CIF

If the seller quotes CIF, 'Carriage, Insurance and Freight', double check 'from where, to where'. Some sellers will only cover CIF to a UK port and the buyer will have to pick up the remaining costs. Always double check INCO terms with the sellers for clarity.

IF CIF terms are used, and the source is outside the EU, the buyer will need to add duty and local freight costs from the port to their site.

Delivered

The seller will pay all costs to deliver the goods including duty and landing costs. There should be no 'hidden' or follow up invoice for transport costs unless agreed between the twp parties.

Sea Freight

For USA and Far East sea freight calculations, check with the seller if the goods are sold Ex-Works or FOB. For materials shipping Ex-Works the buyer should add 18% including duty to cover the full shipment costs. (It's worth getting a quotation for the road freight costs for more accuracy as some factories may be located further from the Port than the average). For materials shipping FOB the buyer should add 15% including duty to cover the full shipment costs.

 

Air Freight

In cases where materials are required at a reduced lead-time,  21% can be used as a guide for the additional costs to ship the goods by air from the buyers site. This includes duty.

Any questions... contact me at rose@roseburridge.com 

I've spent many hours reconciling freight invoices from various Logistics companies, so I'm confident that these figures should be an accurate guide to estimating material costs during costing exercises. Good luck.