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Fedex Admin Charge - Is it a Scam?

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DynamicSpirit

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A couple of months ago I bought an item online from a company in Canada. It was delivered by FedEx (without comment. They simply delivered the package, and as I recall I signed to say I'd received it). And I assumed that was the end of the matter.

But then a couple of weeks later I received an invoice from FedEx for about £24 headed 'Duty and Tax Invoice'. The invoice was itemized as £12 for 'VAT' (which possibly means customs import duties?), and then a £12 for 'advancement fee' - which turned out on investigation to be a charge FedEx levy for paying the 'VAT', supposedly on my behalf. (But the invoice didn't say that - the invoice looks designed to give the impression that it's entirely for tax - you have to go to the FedEx website to discover that 50% it is actually an admin charge levied by FedEx).

This all looked to me suspiciously like a scam, so I just ignored the invoice. I would expect any bill for any form of tax to come from HMRC, not from a private company. And given that the admin charge part of the invoice is for a service that FedEx claim to have provided but which I never asked them to provide, or agreed to them providing in the first place, I can't see how I could reasonably be liable for it after the event (either legally or morally).

Then a couple of weeks ago, I had a reminder threatening further action if I don't pay.

Given the extensive knowledge that people here seem to have, I wondered if anyone here knows anything about this kind of thing? It still looks to me like it's probably a scam - that FedEx, having already presumably already been paid by shippers to deliver items, are then trying to fool the people they deliver to into paying money that those people don't actually owe. But since I don't know how import duties work, I thought it worth checking, in case I'm mistaken. Googling around seems to show that it's quite common for FedEx to send out these kind of invoices to people who aren't expecting them, and there seems to be some conflicting advice online on whether they should be paid.

Anyone have any thoughts?

(And if it turns out it is a scam, what are the possible places I could go to to complain about it?)
 
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Tetchytyke

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Items bought abroad are subject to customs levies and VAT on arrival in the UK. This is charged by HMRC, but is collected by the courier service that is delivering the parcel. Most couriers will charge a handling and administration fee for this.

Usually the courier will not release the parcel unless and until the charges and VAT have been paid.

It's up to you whether you wish to pay it. £12 is a very steep charge. They would have to sue you in the county court to get the money if you don't pay. But it is probably legit.
 
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GB

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This all looked to me suspiciously like a scam, so I just ignored the invoice. I would expect any bill for any form of tax to come from HMRC, not from a private company.

If FedEx paid the duty on your behalf you won't here anything from HMRC because as far as they are concerned the matter is dealt with.

Can't speak for FedEx but on the few occasions I have imported something from the USA, Parcel Force kept hold of the item untill I paid the duty...no extra admin fee was applied as far as I remember.

Look back through your order and if you did not ask for FedEx to pay on your behalf then lodge a complaint with them.
 

aformeruser

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Why not contact FedEx using the contact details available on their website, opposed to those on any invoice if you are unsure whether or not the invoice is a scam?
 

DaveNewcastle

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It is normal for a parcels delivery company to collect the import duties, which it has to account for to the HMRC, in exactly the same procedure as any VAT-registered business must collect and account for the VAT on the goods or services it sells, and for any other duties that are due.
Other agencies may take on the role of collecting duties, and they may do so from another country. But wherever the duties arise, they can be accompanied by an admin fee to cover the costs of invoicing, collecting, accounting and forwarding the collected fees, with any cross-border surcharges and correspondence.

As Arctic Troll noted, Invoices are often to be paid in advance of delivering the goods, but there is no compulsion to do this, and a delivery company may raise the charge seperately in the good faith that the buyer will settle the charge in a timely manner.

Have you already paid the import duty on the item(s) you bought?
 
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Bletchleyite

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As Arctic Troll noted, Invoices are often to be paid in advance of delivering the goods, but there is no compulsion to do this, and a delivery company may raise the charge seperately in the good faith that the buyer will settle the charge in a timely manner.

I'd expect this is the approach Fed Ex takes, being much more of a commercial courier than a consumer one. Hence the invoice.
 

swj99

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You could argue that had you been made aware of this charge at the time when your parcel was brought to you, you would have had the option of either choosing to pay, or refusing to accept delivery, and on this basis, any attempt by them to charge you 'after the event' has no validity.
I would always dispute an invoice raised in respect of something not approved or agreed by me beforehand, especially in a case such as this, where I had no contractual relationship with the company asking for money, and ultimately, it would be a matter for the company to decide whether to pursue it, and then if they do, it would be your call as to whether to defend the proceedings or not. Personally, I'd take the view that if they didn't ask for the money at the time, they can sing for it, and if they aren't keen on doing that, it's up to them to change their delivery policies and only hand over the goods upon payment of the charges.
 

Bletchleyite

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For all international parcels it is convention that costs involving customs are paid by the recipient, as it's very difficult to sort out what they are for them to be paid by the sender.
 

DaleCooper

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You could argue that had you been made aware of this charge at the time when your parcel was brought to you, you would have had the option of either choosing to pay, or refusing to accept delivery, and on this basis, any attempt by them to charge you 'after the event' has no validity.
I would always dispute an invoice raised in respect of something not approved or agreed by me beforehand, especially in a case such as this, where I had no contractual relationship with the company asking for money, and ultimately, it would be a matter for the company to decide whether to pursue it, and then if they do, it would be your call as to whether to defend the proceedings or not. Personally, I'd take the view that if they didn't ask for the money at the time, they can sing for it, and if they aren't keen on doing that, it's up to them to change their delivery policies and only hand over the goods upon payment of the charges.

That's certainly one way of causing oneself a lot of unnecessary hassle.
 

DaveNewcastle

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. . . . something not approved or agreed by me beforehand, especially in a case such as this, where I had no contractual relationship with the company asking for money. . . .
Import duties are statutory liabilities. They are not the subject of a consumer contract or any other voluntary 'approval or agreement'.
 

ainsworth74

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Import duties are statutory liabilities. They are not the subject of a consumer contract or any other voluntary 'approval or agreement'.

Plus you'll often find that the T&Cs of the delivery company you use or the organisation that you bought an item from will clearly warn that you are liable for any fees which may apply.
 

DynamicSpirit

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You could argue that had you been made aware of this charge at the time when your parcel was brought to you, you would have had the option of either choosing to pay, or refusing to accept delivery, and on this basis, any attempt by them to charge you 'after the event' has no validity.
I would always dispute an invoice raised in respect of something not approved or agreed by me beforehand, especially in a case such as this, where I had no contractual relationship with the company asking for money

In moral/ethical terms, that would be my view. I mean, if you're allowed to charge people for doing something that they never asked you to do... I could just invoice anyone for anything. Invoice my neighbours for picking up some litter that I noticed in their garden. Go into the local corner shop, tidy up some items on a shelf (without asking the shop), then invoice the shop for doing so. Feed someone's cat (without asking the owner) and then invoice them for the service. Surely that can't be right, or legal? But I can't see any moral difference between that and what FedEx are doing with their admin charge. (Perhaps for some obscure reason there's a legal difference?)
 

Bletchleyite

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You explicitly did ask them to handle the import of your parcel by way of contracting them to deliver it via the supplier you ordered from. It wouldn't be much use if they didn't, because you wouldn't receive it.
 

DaleCooper

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In moral/ethical terms, that would be my view. I mean, if you're allowed to charge people for doing something that they never asked you to do... I could just invoice anyone for anything. Invoice my neighbours for picking up some litter that I noticed in their garden. Go into the local corner shop, tidy up some items on a shelf (without asking the shop), then invoice the shop for doing so. Feed someone's cat (without asking the owner) and then invoice them for the service. Surely that can't be right, or legal? But I can't see any moral difference between that and what FedEx are doing with their admin charge. (Perhaps for some obscure reason there's a legal difference?)

My only expeience of buying things from overseas has been on eBay where it is always made clear that these charges are to be paid by the recipient unless otherwise stated.
 

Bletchleyite

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My only expeience of buying things from overseas has been on eBay where it is always made clear that these charges are to be paid by the recipient unless otherwise stated.

They are near enough always to be paid for the recipient, partly because a lot of the time they aren't levied at all and you get away with it, but also partly because it's hard to work out precisely what they will be.

The service fee should perhaps be part of the sending fee, but then if it was you'd pay it every time, not just when Customs actually bothered to check.
 

DynamicSpirit

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Have you already paid the import duty on the item(s) you bought?

No, I've not paid anything. If they had invoiced me only for the import duty, and provided clear evidence that they had paid that, then I probably would have paid it very quickly. But the fact that they added their own admin charge, and clearly obfuscated the invoice to (apparently) hide the fact that part of it was an admin charge made me too suspicious.

One option I have wondered about is simply paying the amount that they claim is for 'VAT', and refusing to pay the admin charge. To be honest, the way FedEx have gone about this makes me rather inclined to want to just donate the VAT amount to charity and then tell FedEx to (metaphorically) get stuffed, since I have no contract with them. But I'm not sure if that would lead to any legal difficulties later on.
 

Bletchleyite

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This is very much a symptom of them being a business oriented courier - I genuinely (having dealt with them) don't believe it's obfuscation, it's an assumption that their customers will understand what it is and how it works - and for the vast majority of their business clients this will be true.
 

DynamicSpirit

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Why not contact FedEx using the contact details available on their website, opposed to those on any invoice if you are unsure whether or not the invoice is a scam?

I have done - twice. (Sorry, didn't mention in the starting post because I didn't want to make the post too long, and it didn't seem that relevant to the legal/ethical issues.)

Both times, I asked them to send me proof that they had actually paid customs duties to HMRC, and evidence that I'd agreed upfront to pay any charges. Both times, they gave a reply that basically just restated that the invoice was for VAT and an admin charge, while ignoring my specific queries. So that didn't really inspire any confidence at the time that the invoice was legitimate (although I appreciate that some other people here are saying they think it is, or at least is partly legitimate).
 
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snail

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VAT is not a customs duty. It is levied by the UK authority on goods from outside the EU that cost more than £15. Additional duty is payable on goods worth more than £135.

https://www.gov.uk/goods-sent-from-abroad/tax-and-duty

Assuming your package is worth less than £135 FedEx won't have paid any duty to HMRC, just VAT on your goods (plus VAT on their admin fee). As often advised here on ticket disputes I would pay FedEx and take it up with the retailer to see if they will give you a refund or credit.
 

furnessvale

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VAT is not a customs duty. It is levied by the UK authority on goods from outside the EU that cost more than £15. Additional duty is payable on goods worth more than £135.

https://www.gov.uk/goods-sent-from-abroad/tax-and-duty

Assuming your package is worth less than £135 FedEx won't have paid any duty to HMRC, just VAT on your goods (plus VAT on their admin fee). As often advised here on ticket disputes I would pay FedEx and take it up with the retailer to see if they will give you a refund or credit.

Surely that cannot be correct. The remainers are busy telling us how much DEARER things will be when we Brexit! :)
 

Harpers Tate

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These fees are standard practice and any carrier will levy them. If you think FedEx's £12 is expensive, then arguably it is - the good old Post Office charges £8. But the PO hold on to your package until you pay it - and return it if you don't. It's a flat rate (at the PO at least) so if the taxes are small it seems like a lot, but conversely on a more valuable item it may seem trivial. You ARE responsible for these fees; you effectively undertook to pay them when you ordered the goods.
 

bb21

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At least you got the parcel first. Royal Mail would not release the parcel until one has paid the £8 admin fee plus whatever the HMRC demanded.

Once I had to dispute the charge with HMRC, and getting a refund is like getting blood out of a stone. I gave up at the end because I deemed it not worthy of my time for about £15.

There is no way you can get the admin fees back even if the taxes were incorrectly levied, so it can feel like a scam. I guess it's just one of life's little annoyances in this country.
 

Tetchytyke

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I mean, if you're allowed to charge people for doing something that they never asked you to do... I could just invoice anyone for anything.

You asked them to deliver a commercial parcel from overseas to your house, and as part of that contract you agreed you would pay them an administration fee if they had to pay HMRC taxes and levies on your behalf. You agreed to it.

You may be more fortunate with eBay as private sellers will often label an item as a "gift". Low value gifts are not subject to VAT or customs levies. It is, of course, fraud to label something you're selling to someone as a gift, and it is also fraud to declare something you've bought off someone as a gift.

It is something everyone should remember when deciding if that overseas item really is cheaper than what you'd get in the UK.
 

talltim

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The other thing to remember is that VAT is charged not just on the value of the item, but also on the shipping fees. That's the bit that annoys me.
 

swj99

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You explicitly did ask them to handle the import of your parcel by way of contracting them to deliver it via the supplier you ordered from. It wouldn't be much use if they didn't, because you wouldn't receive it.

No. Your contract is with the supplier (ie, the person or company you purchased the goods from), not the courier. The supplier has a contract with whoever delivers it, but you don't.
 

GB

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You asked them to deliver a commercial parcel from overseas to your house, and as part of that contract you agreed you would pay them an administration fee if they had to pay HMRC taxes and levies on your behalf. You agreed to it.

The recipient usually doesn't get a choice on which company delivers it.
 

Bletchleyite

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The recipient usually doesn't get a choice on which company delivers it.

No, but you do have the choice of order it vs. not order it. And it is a reasonable expectation that all international couriers will work that way - it's just the way it is.

It's always been the case but it's only really come about with the Internet where ordering from abroad is much easier.

The one thing I dislike is when you order off Amazon and they don't tell you they are shipping from China - in that case alone you arguably had not agreed to it.
 
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