What Happens If I Don’t Pay UPS Invoice?

The purpose of this article is to help in answering the question of what happens if someone does not pay their UPS invoice. In addition to discussing the consequences of not paying your invoice, we will also explore how taxes and duties are levied in the UK when inbound parcels arrive through a shipping service such as UPS.

What Happens If I Don’t Pay UPS Invoice?

If you don’t pay your UPS invoice, you will not receive your parcel if it is still in the possession of a shipping company; UPS in this case. If your parcel has been delivered to you but you receive the invoice for duties and shipping charges after a few days and refuse to make payment, the shipping company will forward your details to a debt collection agency which will then repeatedly follow up with you for clearance of your dues. 

If a recipient continues to refuse to pay their invoice, it is also possible their parcel will remain in the warehouse of the shipping company for 30 days; after which it can be discarded by them. In the other case, the parcel can be sent back to the shipper if a recipient does not pay their UPS invoice.

When a parcel is brought into the UK from overseas, certain duties and taxes are due for payment to the recipient of the parcel. In most cases, these duties and taxes are disclosed either to them or the shipper (as the case may be) when an order for delivery is placed by any one of them. In this manner, the recipient is well aware of the amount to expect when a UPS invoice is received by them.

However, there are times when the recipient finds out about duties and taxes after a parcel has been delivered to them. If you find out about these charges at the time of receiving your parcel and you choose not to pay them, you can refuse to receive the parcel. However, in such cases, the charges can be levied on the sender.

Then there are instances when the recipient receives the parcel from UPS without any invoice. The invoice can be sent to them after a few days.

How it works is that UPS pays the duties and taxes on behalf of recipients when their parcel arrives in the UK, these payments are essential for customs clearance without which customers will not be able to receive their parcels. 

The company then reimburses the amount paid during customs clearance either at the time of delivering the parcel or a few days (sometimes it takes a couple of weeks) after delivery has been made.

If a shipper refuses to pay the charges levied in a UPS invoice, they can be charged with a penalty in addition to their original invoice due to late payment. To avoid such fines, you can opt for one of the following payment options:

• Monthly Prepayment Plan
• Weekly Prepayment Plan 
• Special Payment Plan
• Credit Extension Plan
• Weekly Payment Plan

Whether you are the shipper or recipient of a parcel, you can pay your UPS invoice in one of the following ways:

• Credit card
• Debit card
• Check
• Electronic funds transfer
• Payment card
• Letter of credit

Why Are Duties And Taxes Included In A UPS Invoice?

Duties and taxes are included in a UPS invoice as they are part of the charges levied by a country’s government on inbound goods.

The reason why such duties are levied by governments is to make sure that goods imported from other countries do not bear a negative impact on the sales and prices of locally produced goods and that a level playing field for the competition is maintained. 

Duties charged in the UK are based on the following factors:

• Country of manufacture
• Country-specific regulations
• Description and end-use of the product
• Product value
• Trade agreements (if applicable)
• The product’s Harmonised System (HS) code

How Are Shipping Duties And Taxes Calculated?

Shipping duties and taxes are calculated by following the below-listed steps:

• Step 1: Shippers are required to provide a commercial invoice to declare the exact monetary value of the goods. The amount is then converted to its value in GBP, based on the foreign exchange rate at the time.

• Step 2: The cost of transport, insurance and any other additional costs that may apply (depending on the nature and volume of goods being shipped) are then added to the initial value of the goods. This is known as the Customs Value, which determines the Customs Duty. 

• Step 3: There are certain items on which additional charges such as Excise Duty, Anti-Dumping Duties and CAP (Common Agricultural Policy) may need to be applied. This will increase the Customs Value of such product(s).

• Step 4: At the next stage, the Value Adjustment amount; commonly known as VAT, is added to the Customs Value, resulting in the VAT value.

Do Duties And Charges Apply To UPS Parcels From The EU?

Yes, import duties and customs charges apply to UPS parcels when they arrive from the EU in the United Kingdom. 

This was not the case before January 31st 2021. However, as a result of Brexit, parcels valued at more than £135 and arriving from the EU are charged with the following duties in the UK:

• import duties 
• VAT 
• handling fees

Recipients usually receive a bill from UPS through SMS or email along with a web-based link for online payment. Once your payment is cleared, your parcel will be processed for delivery. 

Conclusion:

The above discussion has highlighted that when a recipient does not pay their UPS invoice, they can be penalised with a fine, or the parcel will not be delivered to them or they can expert debt collection agencies to follow up with them for clearance of their dues. While the exchange of parcels between the UK and the EU was free from the levy of customs charged in pre-Brexit days, individuals living on both sides need to be prepared to pay relevant charges when they send or receive parcels either way.

References:

How to Avoid UPS & FedEx Late Payment Fees | Shipware™

Duty Refunds Blog – Reclaiming Customs Charges When UPS Delivers Your Parcel

UK Customs Charges: How to calculate UK import duty and taxes