December 11, 2025
Customs codes and processes
Laws, legislations, tariffs and rules
The Autumn Budget 2025 has delivered one of the most significant changes to UK customs policy in recent years: the abolition of the customs duty relief that applies to low-value imports. With an implementation target of March 2029, goods imported into the UK that are valued at £135 or less, previously exempt from customs duty, will become liable for import duties under the new regime.
What is changing?
- The current rule, under which low-value imports (LVIs) under £135 entered the UK duty-free, will be scrapped by March 2029 at the latest.
- A formal consultation launched on 26 November 2025 invites businesses to weigh in on the details of the new LVI regime. The consultation runs until 23:59 on 6 March 2026.
- The new arrangements are expected to transform how low-value commercial imports are handled by logistics operators, online sellers, and marketplaces.
Who will be affected by the low-value import relief changes?
E-commerce businesses and online marketplaces
Sellers shipping direct to UK consumers will no longer be able to rely on the duty-free threshold for low-value parcels. Many of these businesses, especially overseas ones, have built their commercial models around the duty exemption.
Logistics providers, parcel carriers, and freight forwarders
The change will increase the compliance burden for those handling large volumes of small parcels. They’ll need to adapt to new customs documentation, perhaps submit detailed item-level data, and manage collections for duty and VAT.
International sellers without a UK presence
If you operate outside the UK but ship goods into it, you may soon be required to appoint a UK fiscal representative, a local entity responsible for handling customs duty and compliance.
Domestic retail and wholesale businesses
For UK-based retailers who already pay full customs duties on imports, the change is likely to improve competitive fairness by removing the advantage previously enjoyed by overseas sellers shipping under the £135 threshold.
Preparing for the changes to low-value import relief
- Prepare for compliance infrastructure: Start evaluating whether your current systems can handle item-level data collection and customs declarations. If not, plan upgrades or partner with specialists.
- Review business models: Retailers and marketplaces that built their model around sub-£135 duty-free imports may need to reprice or rethink supply-chain routes, especially if you rely heavily on low-value parcels.
- Engage with the consultation: If you are a business directly affected, consider submitting a response to the consultation. Your feedback may influence the final design of the LVI regime.
- Plan for cost impact: Customers may absorb some of the increased costs. Consider how this might affect demand, pricing, and customer sentiment, and plan accordingly.
- Monitor related changes: This reform comes alongside broader customs and trade policy adjustments, so keep an eye on emerging regulations, especially if you act across multiple product lines or trade routes.
The 2025 Budget signals a big change for UK importers and logistics players. For many in the logistics and supply-chain sector, the change will introduce additional administrative burden, but also new opportunities.
Those who act early, by building infrastructure, rethinking pricing strategies, and assessing supply-chain routes, will be best positioned to navigate the shift successfully. Not sure about your next steps? Speak to our team today.