Intro: £135 has been the line under which anything posted into the UK arrives with no customs duty. That's ending, and the date has already moved once since it was first announced. The Autumn Budget 2025 said the relief would go "by March 2029 at the latest." On 23 June 2026, the Treasury brought that forward to October 2028. If you're a brand that read the original announcement and filed it under 2029, the plan you're working to is already five months out of date, and the mechanism replacing it — a UK-based "fiscal representative" carrying joint liability for your customs debts — is bigger than most coverage has made it sound.
What's actually ending, and what isn't
Worth being precise here, because a lot of coverage blurs it: this is customs duty, not VAT. Import VAT on consignments of £135 or less has already been charged at the point of sale since 2021 — collected by the overseas seller or the marketplace at checkout, not at the UK border. That part isn't new and isn't changing. What's ending is the separate customs duty exemption on the same low-value parcels. Once the relief goes, a parcel that used to clear duty-free becomes potentially dutiable, on top of the VAT it was already carrying.
The date moved, and it's worth knowing which one is current
The government announced the change at the November 2025 Budget, ran a 12-week consultation from December 2025 to March 2026, and published a summary of responses alongside draft legislation on 13 July 2026. The original framing was removal "by March 2029 at the latest." That changed on 23 June 2026: the Treasury moved the backstop date to October 2028, five months earlier, explicitly to leave what it called a two-year runway for businesses and HMRC to prepare. Anything still citing 2029 as the operative date is working from a superseded announcement.
It's also worth clocking why the government moved the date up rather than out. Coverage of the acceleration frames it as backing UK high-street and domestic retailers who've been competing against duty-free parcel imports for years — closing the gap sooner rather than giving overseas sellers another eighteen months of the status quo. That's a political signal as much as a technical one: a policy that's been brought forward once, under pressure to move faster, is not a policy likely to slip back out again.
The fiscal representative is the part worth actually understanding
The mechanism replacing the relief isn't just "pay duty now." The draft legislation introduces a fiscal representative — a UK-based business that assumes joint and several liability for the customs debts an overseas seller incurs on low-value import declarations, and potentially for VAT debts on the same consignments too. In plain terms: an Indian brand posting parcels direct to UK consumers without a UK entity will likely need a UK-based party willing to stand behind its customs and VAT obligations, and that party is taking on real legal exposure by agreeing to it — which is exactly why coverage of the reform expects fiscal representatives to charge a real premium for the role, not offer it as a formality.
How the regime will actually operate isn't fully settled — whether the UK follows something close to the EU's existing fiscal-representative model, or builds its own version, hasn't been finalised in what's published so far. That's a genuine open question, not a detail this piece is glossing over, and it's exactly the kind of thing worth tracking as the legislation firms up rather than assuming resolves in your favour by default.
Marketplaces don't sit outside this. Responsibility for the customs duty falls on the seller and, where a sale is facilitated through one, on the marketplace operator too — and overseas sellers or marketplaces without a UK presence will generally need their own fiscal representative arrangement, separate from a brand's own. Selling through Amazon.co.uk or a similar UK marketplace doesn't automatically make this someone else's problem; it adds a second party into the liability chain rather than removing the brand from it.
What this actually changes for a direct-ship model versus a warehouse model
The impact depends entirely on how a brand is actually selling into the UK. A brand testing the market the cheap way — posting individual orders direct from India, most of them comfortably under £135 — has been riding the duty exemption on every one of those parcels. Once it goes, each of those becomes potentially dutiable, with a fiscal representative relationship sitting behind the paperwork. A brand that already holds stock in a UK warehouse and imports in bulk already pays duty on the way in, so this reform barely moves that brand's own cost — what it does move is the comparison between the two models, making the low-value-parcel route look considerably less like a free lunch than it has for years.
The two dates, side by side, are worth having in one place:
| What | Original announcement | Current position |
|---|---|---|
| Relief removal deadline | "By March 2029 at the latest" — Autumn Budget 2025 | By October 2028 — brought forward 23 June 2026 |
| Import VAT on ≤£135 parcels | Charged at point of sale since 2021 | Unchanged — not part of this reform |
| Fiscal representative regime | Not previously announced | Introduced in the 13 July 2026 draft legislation; mechanics not yet finalised |
Alongside removing the relief itself, the government is consulting separately on new data and payment requirements for low-value consignments, and on a possible administration fee layered on top of the duty. None of that is finalised, and it's a mistake to plan around numbers that don't exist yet — but the direction is consistent: this isn't a single line-item change, it's a rebuild of how low-value parcels get processed at the UK border, with more data expected upfront and more parties formally on the hook for getting it right.
Worth doing now, even with 2028 as the date
- Work out how much of your UK revenue is sub-£135 parcels shipped direct. That's the exposed share of the business — everything above that threshold already carries duty and isn't affected by this change.
- Model landed cost for that channel with duty added, not at zero, and build in a fiscal-representative fee once that market starts to form rather than assuming the role will be free or optional.
- If your goods qualify for CETA preference, confirm the origin documentation is in order now — origin matters more the moment every parcel is potentially dutiable, not less.
- Track the draft legislation for the operative date, not just the backstop — it's already moved once, and "October 2028 at the latest" doesn't mean it can't move again in either direction.
The relief isn't ending in 2029 anymore. It's ending in 2028 — and the thing replacing it is a UK entity taking on legal liability for your customs debts, not just a bigger invoice.
This also puts a sharper edge on questions that were already worth asking before this reform: does the brand hold its own EORI and importer-of-record setup, or is it relying on someone else's, and is VAT registration current enough to absorb a fiscal representative relationship being layered on top. Neither question is new because of this reform — it just makes getting them wrong more expensive.
None of this resets the maths for a brand that's already built its UK route assuming duty is paid and priced in from day one — which is how we build it in onboarding, alongside the origin documentation that CETA preference and this reform both depend on. A brand still costing its UK channel on a sub-£135, duty-free assumption is the one this change actually catches out.