VAT for Logistics
The logistics sector has a complex VAT profile — from fully standard-rated domestic haulage to zero-rated international freight and exempt insurance. Getting the rate wrong on import VAT can result in significant penalties from HMRC.
Postponed VAT Accounting (PVA)
Since January 2021, UK importers can defer import VAT to their VAT return instead of paying it at the border. This improves cashflow significantly for logistics businesses. You must be VAT-registered and declare using your C79 certificate or PVA monthly statement. Use our VAT calculator to model the deferred amounts.
VAT Rate by Logistics Supply Type
| Supply | VAT Rate |
|---|---|
| UK domestic freight haulage | 20% |
| International freight (exports) | 0% |
| Import VAT on goods | 20% |
| Courier services (UK domestic) | 20% |
| Fuel for haulage vehicles | 20% |
| Warehouse storage (UK) | 20% |
| Port handling & loading | 0% |
| Freight insurance | Exempt |
Key UK Logistics VAT Rules
Zero-rating international freight
Transport that moves goods out of the UK is zero-rated even if you're a UK haulier.
Input VAT recovery on fuel
You can reclaim 100% of VAT on diesel used in commercial haulage vehicles.
Import VAT as input tax
Import VAT paid (or deferred via PVA) is fully reclaimable as input tax on your return.
Mixed UK/international routes
If a route includes both UK and international legs, apportion VAT based on the UK portion.