Importing from Mexico to the UK: A Guide for Businesses

With a thriving economy and a multitude of natural resources, Mexico has grown to be a great trading partner of the UK. Currently, Mexico’s export market is booming, meaning that there are a lot of opportunities for UK businesses to import from Mexico. In this guide, we take a detailed look at both the opportunities and the rules when importing from Mexico.

 

Fact File

  • Capital City: Mexico City
  • Largest City: Mexico City
  • National Language: Spanish
  • Currency: Peso
  • GDP Total: $1.232 trillion
  • Population: 125,235,587
  • Area: 1,972,550 km2

Mexico’s Top Exports

In 2014, exports from Mexico amounted to US$397.5 billion. This has increased by over 33% since 2010. In addition to this, recent releases from the International Monetary Fund show that Mexico’s total Gross Domestic Product amounted to $2.141 trillion in 2014, meaning that exports amounted to 18.6% of Mexico’s total economic output. This means that, given Mexico’s population, and its $397.5 billion in exports in 2014, exports translate to around $3,265 for every resident in the country.

 

With such a large and thriving export market, it’s apparent that there are a number of investment opportunities in Mexico. If you’re looking to import from Mexico, there are a number of key sectors to look at. The most popular exports from Mexico are:

 

  • Vehicles (21.6% of total exports)
  • Electronic equipment (20.1%)
  • Machines, engines, pumps (15.2%)
  • Oil (10.6%)
  • Medical, technical equipment (3.6%)

 

In addition to these thriving industries, there are also a number of up and coming industries. For instance, furniture and lighting exports have grown over the past 5 years, with sales up by 78.5%.

 

In addition to this, vehicle exports also rose by 66% while Mexican iron or steel product exports posted the third-fastest gain in value at 64.9%.

Importing from Mexico

Mexico is a non-EU country, so the standard rules will apply for imports. As such, standard VAT and duty must be paid on all of your goods. You can do this by looking up the commodity code of the goods you’re importing. By doing this, you’ll be able to see the level of duty, tax and VAT you’ll need to pay, as well as all the regulations you need to follow.

 

Declaring Imports: Notifying HMRC

All imports from Mexico have to be declared to HMRC using a SAD submitted through the Customs Handling of Import and Export Freight system (also known as CHIEF). This is a fully computerised system, which makes it simple to declare all of the goods you’ve imported.

 

However, it can still be time consuming, particularly if you import large quantities of items regularly. To help, here at TNT we can do it for you using our Express Import System. There are options to suit your timescale and budget, so take a look for the full details on how it can help you and your business.

 

Duties: Using the Trade Tariff

You’ll have to pay duty on all of the goods you import. However, the amount you need to pay does vary, so check carefully. The amount you pay is dependent upon factors such as how the goods are classified under the UK Trade Tariff and how the goods will be used once in the UK.

 

The Trade Tariff is a very useful tool to help you with this. It allows you to see whether restrictions are in place on the items you’re looking to import, also whether you’re prohibited from shipping them.

 

Finally, if you’re importing dangerous goods such as firearms, it will also tell you if you need an import licence.

Paying the Appropriate VAT

When you import to the UK, you’ll have to pay VAT on the goods. The standard rate of UK VAT currently stands at 20%. However, some items, such as antiques are free from VAT, while others come at a reduced rate.

 

VAT must be paid directly to HMRC. If you’re based in the UK, your business will already be VAT registered. If this is the case, ensure that you fill in a VAT return. This way you can claim the VAT back if the goods are used for business purposes.