Fedex Ireland and unfair duty charges
I’ve been on vacation for a week, introducing Bea to the many joys of the bogs of Connemara. I think she liked it.
While I was away, I appeared in Ireland’s newspaper of record, the Irish Times, specifically in Conor Pope’s ‘Pricewatch’ consumer-affairs column, under the byline “Shopped to the taxman”. Here’s a cut-and-paste of some relevant snippets:
Justin Mason [hey, that's me] contacted Pricewatch after being hit with just such a charge. In August, he and his wife, who were expecting a baby, received a package from friends in the US [thanks Nishad and Janet!] containing amongst other things, some hats, socks and a little hoodie for their baby.
“It was shipped via FedEx, got here in good time and was very cute,” he says. The couple were delighted, until a couple of weeks later, when they received an invoice from FedEx looking for EUR 34.47, made up of EUR 2.49 duty, EUR 19.88 VAT and EUR 10 in “administration fees”, plus an additional EUR 2.10 VAT on the “administration fee”.
“This strikes me as pretty unfair, maybe there’s duty payable, but I’ve never had to pay VAT on a gift I’ve received before? On top of that, being charged one-third of the price as an administrative fee? Ouch!”
The couple disputed the fee and were told if they didn’t pay, the invoice would be sent to a debt collection agency and non-payment would affect their credit rating. A couple of weeks later, another gift arrived from the US, followed by another invoice looking for EUR 7.84 in duty, plus the EUR 10 administration fee and EUR 2.10 VAT on that fee. Mason disputed the charge and was eventually told it would be waived as it had a value of less than $50 (EUR 34.70) and was clearly labelled as a gift. There is tax relief called Small Parcel Standard Relief on goods purchased from outside the EU, which is EUR 22 for bought goods and EUR 45 for gifts, so the tax should never have been applied by FedEx.
We contacted FedEx and UPS, highlighting our readers’ concerns. A spokesman for FedEx said the administration charge has always been in place in Ireland and was applied “to ensure customers receive their packages quickly”.
He said that if it did not pay the VAT and duty, “packages would not be cleared through customs until the customer has paid them, thus adding severe delays to the delivery process”.
So, to be honest, I’m not impressed at all with Fedex’ response here. I was hoping they’d be more helpful, especially once it hit the most significant consumer-affairs column in the country — but not at all :(
To recap — since Conor didn’t mention it — here are my problems with the charges:
the packages were both genuine, unsolicited, gifts. Surely having to pay duty on a gift is not applicable; it certainly makes receiving a gift a particularly unpleasant experience!
the first package contained baby clothes, which are VAT-free in Irish tax law anyway.
we cannot seem to get contact details for someone at Customs and Excise to talk to about this, and Fedex have failed to get back to us since then.
Not sure what the next step is…
There’s also a little follow-on discussion at Conor’s blog.
Update: good news. A couple of days ago, a letter arrived from Fedex UK, containing 2 credit notes; both invoices had been reduced to EUR 0.00, citing “incorrect application of duty” for one, and “customer satisfaction policy” for the other. Hooray!
Tags: bea, consumer, customs, duty, fedex, import, ireland, pricewatch, rip-off-ireland, rip-offs, tax
Daryl C. W. O'Shea said,
November 12, 2007 @ 3:18 am
I ship and receive a lot of stuff internationally (both personally and the stuff we manufacture at work). The tax stuff is mostly to blame on twisted customs and excise rules of the (any) country involved. Many countries now often charge taxes on gifts due to so much abuse from people trying to avoid tax for things like eBay transactions.
On the administration fee front, though, many couriers wave the fee if you open a (free) account with them via their website since it eliminates the significant cost of them tracking you or your credit card number down for payment. In Canada, FedEx automatically drops their $7 brokerage/administration fee when you have an account with them… even if something shows up that isn’t on your account and you tell the delivery guy to bill it to your account (you’ll probably have to tell him that yes he can do that and show him how to do it on his tablet or provide him with a phone so he can call to find out how).
Interestingly, I’ve found that for importing stuff to Canada, FedEx is your best bet if you can’t (or can’t wait to) do it via the postal service (which has a $5 flat rate for brokerage here). To what degree crossing the pond screws up the operations of the various couriers, though, I have no idea.
David N. Welton said,
November 12, 2007 @ 10:02 am
When my father shipped me a copy of my birth certificate in Italy, Fedex tried to charge me import duties on the declared (replacement, obviously) value of $50. I did manage to get out of that one, but it’s really awful that a company that ought to be on your side is the one trying to scam you out of money.
Michele said,
November 12, 2007 @ 9:37 pm
I’ve been bitten by that more than once. One time we paid the duty but FedEx didn’t have any record of the payment and were pursuing us for about 3 years!
Bernie Goldbach said,
November 13, 2007 @ 9:47 am
You have two options.
Don’t pay the disputed payment. When contacted by the credit collection people, outline the dispute and send the credit agency registered post of the information. In my experience, they stop calling.
Pay the disputed amount and then invoice FedEx for the amount back. You may get a credit note instead.
I have EUR 220 in disputed collections with FedEx in 2007 so your experience may vary.
Justin said,
November 13, 2007 @ 1:16 pm
thanks for the tips, guys. Bernie — those are particularly interesting! Have you found that option 1 still affected your credit rating? (did you check?)
(If you can’t guess, I’m particularly peeved by the prospect that an unfairly levied charge can effect my future transactions with other companies. IMO it’s offensively absurd.)
droid said,
November 19, 2007 @ 2:49 pm
I had the same thing with DHL. I cancelled a cheque and refused to pay and eventually they halved the fee.
Strangely enough, i just sent a big crate of records form Jamaica back to Dublin with Fedex, blatantly falsifing the worth of the package at €100, and yet I still got it without paying any fees or duty!
Paul said,
November 20, 2007 @ 12:15 am
Bought a few things from Abercrombie in the USA.
Got an invoice in the post.
I’ve sent Fed-Ex an invoice querying the admin charge. There is no way on earth I am paying it.
It’s amazing that they are being allowed to get away with this. As my accountant friend pointed out, they have to hire someone just to calculate and pay their vat charges to the govt.
How Fed-Ex think they can pass this on to customers is beyond me.
Paul said,
November 20, 2007 @ 12:17 am
oops, I sent them an email, not an invoice.
Schaffer said,
December 19, 2007 @ 6:25 pm
I had a similar issue with FedEx a while back. I ordered about 150 euros worth of goods that were sent via US postal service. After these failed to arrive, the supplier sent it again via FedEx. The goods arrived shortly afterwards which was fine. A few weeks later FedEx sent me an invoice for around 40 euro, duty and their handling costs. I queried them and they told me that I had to pay. I rang customs, and they said that I Fedex were always doing this, and I only had to pay the duty. I sent Fedex a cheque for the duty and refused to pay their handling costs as I had not authorised this duty payment. Fedex passed my info on to a debt collection agency, and I started to receive threatening letters from them. I believe this company is part of Fedex and tries to scare people into paying. They have no legal standing, especially in Ireland. After about the 5th letter, I rang up Fedex and told them that I was not paying their fee as I had not told them to pay the duty. They tried to argue that I was a customer of theirs, which I was not, as I did not initiate the shipment and that they had no contract with me under Irish law. After a brief argument, I told them to sue me for the money… after which they dropped the charge as a “good will” gesture. It appears that Fedex make a lot of money this way. Once you are the receiver of the goods and have not authorised them to pay duty, you owe them nothing. Also they will not bother chasing the money either.
Michelle said,
January 25, 2008 @ 12:23 pm
I came accross your comments last night about the duty that FedEx charge and in particular a comment made by someone in relation to the collection agency that they are using to try and collect these debts. For those you who think they have no jurisdiction in Ireland I must say you are very wrong. They might not be able to sue you themselves but they are more then entitled to engage the services of an agent in Ireland to do the chasing for them. They are also entitled to pursue you through the Irish Courts for the recovery of the monies that are owing…….. So please dont believe the misconseptions that they cant get you just beceause your in the republic beacuse believe me they can and this is course of action they take on a regular basis. A court judgment is the last thing anyone wants listed against them………..
Paul said,
January 25, 2008 @ 12:56 pm
Well I paid the Duty and Tax element of the bill yesterday, but not the administration fee.
If they want to take me to court for their bullsh1t profiteering €12.10 charge, then we shall have our day in court.
Michelle said,
January 25, 2008 @ 1:07 pm
Well for €12.10 i dont think they will be bothered but for larger amounts they have no hesitation in taking that line of action……….
david said,
January 29, 2008 @ 12:12 am
I agree with not paying as I did not agree to any payments or have any proof that any custom duty was paid and the administration charge is a rip off
Tim said,
March 19, 2008 @ 12:20 am
I am in the middle of a similar ordeal with FedEx, that has left me furious.
Shortly after the birth of our second baby, we recieved an unsolicited gift of some baby clothes from my wife’s estranged father. My wife signed for the package with no knowledge of who it was from or what it was, or that there would be any charges involved. (We were expecting another package at the time.) Upon opening the package and realising what it was, we decided not to accept the gift, informed the sender why, and it remains in the box it arrived in. (The situation is complicated.)
About a month and a half later, we recieved a letter from FedEx saying we owe them money for the gift. My wife told them that the gift was unsolicited, we don’t want it, and that they can come and get it anytime they want. Also that if they have a problem with that, and that they should contact the sender and forward their charges on to him! They suggested that I try and get some kind of refund (What kind of idiot do they think I am? “Hand over the money and then we will give you a refund!” – Yeah Right!)
I am now on my third letter from FedEx, a “Notice of Intention”. I find it funny that I am being threatened by a company with which I have no legal agreement. (Surely the business transaction is between the party that comissioned FedEx to send that package and FedEx?)
As this issue is more about principal than the money involved, I will be giving FedEx a piece of my mind about this again tomorrow, regarding their totally sloppy, unprofessional and extortionate behaviour (”Pay use plus a €10 Admin fee or else!”)
Paul said,
March 19, 2008 @ 12:43 am
Good for you Tim, don’t give into their nonsense.
Justin said,
March 19, 2008 @ 10:36 am
wow Tim, that really takes the biscuit! I agree, don’t give in.
Dan said,
March 29, 2008 @ 4:26 pm
I’m also in the middle of a dispute with FedEx. In the past I’ve paid without hassle, but this time I’m refusing to. I ordered some automotive tools from the US, tot he value of USD 59 (around GBP 30). Around 3 weeks later I received an invoice from FedEx requring payment of GBP 21.66, £14.86 in International Priority VAT and a £6.85 admin charge. VAT is charged at 17.5% in the UK, I’ve never paid any more on other stuff I have bought from the US. What they are calling VAT on my invoice is billed at around 30%, plus they have the cheek to ask for an admin charge on top of that! I’ve written to them asking for an explanation in writing, and have also written to the UK Revenue & Customs asking for written confirmation if this is legal, which looking at their website is not.
What a pathetic profiteering outfit FedEx seems to be. I will not be using them again!
Wayne Haywood said,
June 16, 2008 @ 9:41 am
Hi,
hope I’m not too late to join in here but I too have been invoiced for a Fed Ex admin charge. (A web search led me here)
I have lodged a complaint with Fed Ex but I am unable to believe they can do this.
I ordered goods from a US website to me here in the UK. Goods were delivered and 2 weeks later an invoice for duty and the admin charge. Total of package £36 with postage from US. Duty £14 (thanks UK government) and £7 Fed Ex admin fee.
Want doesn’t sit right with me, as others have mentioned, is that I have not entered into a contract with Fed Ex. Their services were paid for by the shipper. They have paid the duty (which I was unaware would need to be paid) without any consultation to me. I would encourage anyone else invoiced for this charge to; a) ask to talk to the complaints dept and lodge the complaint. b) take advice from CAB, and/or any free legal advice you may have, i.e. through house insurance c) take it up with any media related source, i.e TV shows like Watchdog or newspaper related consumer features
Paul said,
June 17, 2008 @ 7:12 pm
Keep up the good fight!
Antonio said,
August 16, 2008 @ 6:06 pm
Hi,
I have also been taken for a ride by Fedex twice, one for gifts I did not asked for and that were marked GIFTS (a shirt from me mom an a cd with pictures) yet I got a £36 bill, both instances they got a collection agency as I refused to pay, but did not have the courage to continue :-(
I wonder, for those who cite the ‘did not enter into a contract with them’ if you sign, are you agreeing legally to the transaction and hence liable? and for those packages that do not get signatures (both of mine were delivered to work and I did not sign for them, can someone then send you a blank cd and put a ridiculous value on it just to bother you and get away with it? I mean, there seems to be no control of this? Those of us in the UK should notify our MP, this is something that they may love to pursue on one of their little committees. Fedex are just extortionists!
Cynthia said,
August 24, 2008 @ 1:12 am
I, too, have just received an unexpected invoice from Fedex. I ordered some goods from India, prepaid including freight. The items totalled £2,100. The invoice listed Fedex International Priority Duty £134.40 (even though the items took nearly a month to arrive!), VAT £392.19, admin fee £13.16. They even seem to have added VAT to their international priority duty. The total invoice is £539.75 – over 25% of the value of the goods. I didn’t even know they were coming by Fedex; I am not a customer of theirs and have already paid freight charges so I’m likely to be in for a battle as I only intend to pay VAT when I receive an invoice for the correct amount. Good luck to everyone who fights for justice.
Seán said,
August 29, 2008 @ 4:21 pm
Hi, Same thing has happened me. Bought a motorbike jacket from America about a month ago. It cost approx. 106 euro and I paid 40 euro shipping. Yesterday I got a tax/duty bill from Fedex looking for 57.80 euro. How the **** do they charge that amount of tax when tax on goods in Ireland is about 21%. Rang custom office and lady there said loads of complaints re. Fedex but that it was between myself and Fedex and she couldn’t do much unless tax office got wrong amount. When I rang Fedex they said to ask company I bought jacket from if they would pay and if they(fedex) didn’t get paid my details would be sent to a debt collection agency. Not sure how I’m going to handle this now as I’ll be in the market for a morgage (credit rating) in next year or so. Be sure that I’ll be sending my case details to newspapers and to local politicians before giving them a cent.
miky said,
September 2, 2008 @ 6:35 pm
Hi, Seems like my story is very similar to y’all. bought stuff off ebay from a shop in us,got the item in uk,received the fedex invoice after 2 weeks…i was afraid they would track me down by not paying(though i am moving house) and get me to pay a ridiculous bill after long time…its not for the 28 £ though i am a skint student and they do count at the end of the month, but its more about the principle,let me know first i have to pay,then i will decide…probably by doing that they wouldnt get any customer! I decide then to stand for justice and for the freedom of the man living in this world made of burocracy and big companies imposing fear to the single individual!
Cynthia said,
September 4, 2008 @ 1:03 am
I know someone whose daughter bought an item from Hong Kong via ebay; it arrived by Fedex. Then she was horrified to receive a bill from them as she believed everything had been settled with the ebayer. The dispute went on by letter for some time. My friend suggested that Fedex should pursue the sender of the goods, who was their client after all. Fedex’s debt collectors then started writing so my friend returned their letter “Gone away; return to sender.” No more letters were received. You really have to stand up to these people. With my own dispute concerning a Fedex bill for over £500, I have emailed Fedex twice, written once enclosing copies of my emails, but have received no response apart from their automated email reply. I have tried phoning but keep getting another automated reply saying they “are busy.” Excuse me, so am I!! What a way to run a company. Where’s the customer service? I wish someone from Fedex would read these comments.
Gary said,
September 9, 2008 @ 10:18 pm
Hi all.
I was doing some googling for the address of my local FedEx office when I stumbled on this. I bought an item back in May and it was shipped from the US via FedEx. The item itself cost just under $80, plus another $40 P+P. Just yesterday I received a letter from a Scottish “Dispute Resolution Firm” (also debt collectors) telling me to pay €32.05 in FedEx fees or face “formal proceedings”. So obviously my information has already been passed on to these people.
Aside from the obvious, my main issue is the fact that this came completely out of the blue. This instance was my first – and you can betcha my last – time using FedEx. I was not aware of any admin / duty fees or that I would have had to pay VAT to these people. What tops it all off is the fact that I hadn’t received a single communication from FedEx indicating that I owed them money – not a single e-mail or letter or phone call from them since May – but yesterday I get a threatening letter from a debt collection agency demanding money?! Is this even legal?! Do they not have to at least make me aware of it first?!
And also, would anyone happen to know the address of any FedEx office in Dublin (preferably the city centre)? I’ve tried calling both FedEx and the Scottish company (Avance), but neither are even answering their phones.
Thanks.
Phil said,
September 15, 2008 @ 4:37 pm
If I received an unsolicited invoice from a company with which I had no contract, I’d probably want compensation for my time and effort dealing with their correspondence.
I think a €20 admin fee to them would probably cover it.
Josie said,
December 17, 2008 @ 2:38 pm
Hi, don’t know whether there is any point in writing what has happened – ordered some goods, was delivered and then an invoice arrived – duty 5.89, VAT 51.88, admin fee 10. I am willing to pay just the duty as I am not Irish citizen and I will be moving shortly back to my country therefore I think there is no need to pay VAT… after all when people travel they are entitled to tax return for the purchased goods…. regarding the admin fee – the word ripp off is correct…
Sean said,
January 14, 2009 @ 12:11 am
The item I ordered from HongKong is on the way to me now, I am in the same situation as you Josie. So did you pay the VAT at the end? Or is anyone else there in the same shoes?
Dan said,
January 14, 2009 @ 1:24 am
Oops… I made a mistake above, I meant to say if you live in Europe and order from the US or outside of Europe you are liable by law for VAT and import duty, you can get the exact figures from your country’s customs website or office.
However it is worth noting that if your item comes by the Royal Mail into the UK you will most likely not be charged either of the above. Something good to say about the Royal Mail at long last!!!!
Tia said,
February 5, 2009 @ 7:20 pm
I ordered goods to the value of 120 euro from New Zealand last year. A children’s clothing company. Fedex delivered and I was not charged anything. I paid all delivery charges at the time of ordering. I have checked my credit card statements for the past few months and I have only been charged the exact amount I agreed to when ordering the kid’s clothes.
Is it just Fedex U.S that is causing trouble??
My daughter orders from Yestyle.com a Hong Kong fashion store..she gets all her items delivered by An Post ( our regular Postman !) and although she never spends more than 80 – 100 at a time she has never been charged taxes etc..she just pays the total cost including delivery charge at the time of ordering and that’s that..
I find it very confusing…I was just going to buy clothes from Victoria’s secret ..thank God I came across this site….:)
Justin said,
February 6, 2009 @ 11:07 am
Tia –
I think they pick out parcels from the US in particular.
Also, it’s worth noting that I just got a “delivery notice” last week, requiring that I pay VAT on an An Post-delivered parcel from the US! so they’re starting to do this with parcels delivered via An Post as well.
Josie said,
March 31, 2009 @ 12:26 pm
Sean, no I have not paid yet those invoices… i am still furious… they still keep threatening me and I am really pissed with them… but still I am wondering…. they as a company can/should be able to claim the VAT back…. well, can I claim it back too???
Brendan said,
April 3, 2009 @ 6:16 pm
Just doing some research into shipping a bike back from the US, so interested to read the comments here. Duty I could live with, but the admin charge? A check on the FedEx site shows:
“Important notice: FedEx currently charge an administration fee of 2.5% of the combined Duty & VAT charge or €10.00 (whichever is greater). Start date implementation: June 18th, 2007.”
As if the paperwork for a more expensive item will cost more!! Bit of a scam alright.
Maan said,
April 3, 2009 @ 6:19 pm
The charge is illegal in the UK, they can charge actual repackaging costs, no more.
Nicola said,
June 23, 2009 @ 7:49 pm
Hi everybody, we just lanched this free online tool that might help. http://www.dutycalculator.com It is a beta version, so would be great if you could try it and let me know.
Also, I am working on the faq section and trying to understand all those ancillary charges that couriers apply. If you still have those bills, feel free to send them at handlingfees@dutycalculator.com
bestest! Nicola
denis said,
July 18, 2009 @ 9:22 pm
Hi all,
Just wanna let you know the situation with all imports ‘bar most docs and low value shipments under 22 euro, goods are subject to vat and possibly duty on import from outside the EU!! if you dont believe check out the revenue website….gifts under 45euro Including freight charge are free of charge. ( these are few and far between) unless you get shipper to quote CIF,DDU or DDP terms on their invoice you will be charged. the admin cost is because these companies have to put your Vat and Duty on their Tan Account with Customs, and do the entry to clear the goods, all companies will make some mistakes its human error….they do there best if you have questions check out the revenue website Taric contains duty amounts and all. thx D
Nicola said,
July 18, 2009 @ 10:03 pm
Hi all, for goods that are imported from outside the EU, neither duty nor VAT are due if the total value of the goods, not including shipping charges or insurance, does not exceed EUR 22. http://www.dutycalculator.com/faq/57/
Gifts are sort of more complex, but neither duty nor VAT are due if the value of the gift, not including shipping and insurance costs, does not exceed EUR 45 and if the customs declaration is correct. http://www.dutycalculator.com/faq/67/
Everybody makes mistakes, I make mistakes as well. But that’s why we need to share our experiences, shade some light on duty and VAT charges and empower the buyer so that he (or she) can eventually ask the right questions.
Hope this helps, have a great weekend! Nicola
Mehmet said,
September 10, 2009 @ 7:37 am
i was scammed once by fedex, i never use them again, if i m buying something i do ask what they do use for posting, if they are using fedex, i just dont buy unless they send with different company. im sorry for everyone who conned by fedex.