Mugged by Royal Mail Handling Fee

Imagine my delight to get a little note through the door to tell me that my item I had ordered had not been delivered as it had some VAT that needed to be paid.

OK I though, that’s fair enough. Off I toddled to the Royal Mail sorting office. It’s so customer freindly in Newark that there a re no spaces to park for customers – so I parked in the nearby pay and display car park – Cost £1.00

Head into the Royal Mail sorting office and fork out £9.11 for the VAT that needed to be paid, and then got stug/ mugged/ robbed (delete as appropriate) with a further £8.00 Royal Mail International Handling Fee.

So lets rewind ab bit. I ordered a lovely pen at a total cost of $98.99. which I guess equated to round about £60. So paing VAT I’m fine with. How on earth do they justify an £8.00 handling fee thugh. Does it really cost them £8.00 to collect £9.11, because if it does isn’t that another argument that shows collecting certain taxes are wholly inefficient as the cost of collecting is the same as the revenue received. How can it cost £8.00 when it only cost $9.04 to get the parcel all the way from Texas?

You know I wouldn’t mind if there was ANY way in which the handling fee could be avoided. But apparently there isn’t. I wonder how much Royal Mail International receives each year from handling fees alone. You only have to put the phrase in google to see how outraged people are.  So not only have the company allowed the pension fund, in which I have a few years worth of payments, to run into billions of pounds worth of deficit, but now they are actively stealing money out of my wallet in the form of their “handling fee”!


48 Responses to Mugged by Royal Mail Handling Fee

  1. WitchEnd says:

    I heard the postman push a bundle through this morning. In the bundle was a card saying they can’t deliver an item coz there’s a fee to pay. The postman presumably didn’t have the item with him as he didn’t ring. The sender paid 30p too little but the fee is that plus £1 handing charge = £1.30. So the handling charge is 333% of the shortfall… I’m not expecting anything so I shall not respond. They will then presumably bear the cost of returning the item to the sender… How much have they wasted to get 30P!

  2. Katrina says:

    I have goods sent to me on holiday in the US now if I want something from over there just to avoid such daylight robbery. What starts off as a reasonably priced purchase can virtually double once Gordon Brown has taken his cut (and I will always blame him!).

  3. editor says:

    What I just don’t understand is how it costs £8 to collect the fee, as that’s their argument. A very inefficient collection service if you ask me!

  4. Alister Troup says:

    £8 is as bad as £20+vat that the courier companies charge

  5. editor says:

    Alister – I assume the £20 you mention is for delivery.

    I had already paid for delivery.

    I also didn’t mind paying VAT on the import. The £8 was the “fee” for collecting the VAT.

  6. Pingback: The Daily Dozen: Tuesday 

  7. David says:

    Royal Mail and Parcelforce charge a handling fee to cover the costs for operating the Postal Customs Depot. Handling the package for customs examination – opening, repacking and resealing the package has a cost (inland mail can only be opened with a warrent). Don’t forget if sent as a standard package the sending country’s postal administration get all the postage revenue. If you want to avoid charges, get the sender to pre-pay the VAT and duty (most UPU countries do this), it will also save delay in getting your goods.

  8. Tony Baverstock says:

    I love this, it clearly shows how few people have any idea what collecting money involves.
    1. Post Man delivers card to you, cost of card and time to write.
    2. When you pay it this has to be entered into there accounting system. This takes time.
    3,. The money has to be counted. This takes time.
    4. It then has to be taken to the bank. More time.
    5. The money banked will need to be reconciled to the ledger and errors investigated. Even more time.
    6. I assume the fee includes VAT so records need to be stored for a minimum of 6 years.
    7. You need an internal auditor to check the system is working. I assume you don’t want the mail man to just pocket the money.
    8. I once had to reclaim £5 from some one who had over claimed on expenses, the boss was very strict on these things. He gave us a £5 note we estimated it would cost at least £25 to process the cash, as we never handled cash, so we gave it to charity and save the Company £20.

  9. editor says:

    Tony – if the cost of collecting something – say a tax is as much or more than the cost of what you are collecting then it is wholly inefficient.

    1) Cost of card and time to write it – laughable. No charge when they write to say they couldnt deliver your parcel because you were out. D’oh!

    2) Cost of handling cash?? they are the biggest cash handlers in the country. When I worked there not that long ago I was in charge amongst other things of pulling together a few key facts on the business and 1 in 4 pounds in the economy came through a Post Office – so no economies of scale there.

    3) It has to be entered into the accounting system? Use Horizon – it cost billions to automate Royal Mail so use that. You can do business banking and pay money in for free – so why should there be a cost for collecting money for HMRC (which funnily enough you can pay over the counter for free for some things).

  10. Matt says:

    It’s a lot less than the banks charge for refusing something electronically.

  11. editor says:

    Lots of bank charges are avoidable. An oridnary punter buying something abroad could not have avoided the £8 fee.

    Apparently a sender can pre-pay VAT. I never knew that, and I suspect most people don’t.

  12. Geoff says:

    When is someone going to do something about this iniquitous tax on a tax. I’ve just had to go and collect (why, when PO have been paid to deliver) two parcels from the States from a Post Office surrounded by double yellow lines and with only two parking spaces. I’ve paid £5.70 VAT on one and £2.75 on the other PLUS handling charges totalling £16. Total value of goods in the two packages – around £52. Taking VAT and handling charges together, that amounts to just under a 50% surcharge in total. Where else do you have to pay a handling charge in order to pay your VAT? Shops don’t do it (and wouldn’t dare)! .And if you’re wondering “why do I buy from the States?” It’s because here in rip-off Britain the identical items would cost me just over £150 in total + exorbitant P&P rates, As always – heads they win and tails you lose.

  13. The tax man says:

    What ever happened to ‘Buy British’!!!!

  14. editor says:

    Tax man – are the clothes you are wearing today made in this country? Doubt it. Car? Probably not. The item I wanted was from America, and is an American product – so I couldn’t buy British if I’d wanted to.

  15. James D says:

    And of course if it really did cost £8, the person they’re doing the service to is the tax man, so he should be billed for it. That way the government would soon learn that this is an uneconomic tax to collect on goods below a very high value and adjust the thresholds accordingly. Somehow the government need to be made to live in the real world.

  16. shane says:

    hello does anyone pay attention..
    firstly the 8 pounds payes for as stated
    the many premises to recieve open check repack anything that customs tells them too.the only people that pay are the tax evaders just like editor whom decided tax evasion is ok.
    maybe he would find it cheaper with a court summons,fine and costs.or even a nice prison sentance.

  17. shane says:

    secondly.the 8 pounds payes for royal mail toi collect your cash and process it into customs.and yes it does cost time money and effort for a postie to write ,deliver the card store the parcel and send it back if its not payed for..
    as you mentioned earlier keeping any parcel unable to be delivered is free only because it would cost far more and block up the system to return them all.personally i would make people pay for that too.this is a buisness (even if it is being run into the ground by bullying managment ready for privitisation)not a charity

  18. editor says:

    Shane are you a moron?

    1) the parcel was not sent back – so why would the fee have to cover that?

    2) the parcel was not opened in any way. It had a customs declaration on the front stating the value.

    3) In what way am I a tax-evader.(Not sure what a sentance is??) I bought an item and am very happy to pay the VAT. I do not accept it costs £8.00 to collect, and nothing you have written has given an indication that £8.00 is in any way an accurate reflection of the cost to collect the VAT,

    4) Royal Mail is indeed a business who I worked for for a number of years. You could argue it is being run into the ground by a moronic union that does not see the need to modernise and become more efficient.

  19. The tax man again says:

    Wha heyyyyyyy The ‘moronic union’ jibe,blimey,suprised it took so long.

    Anyway,if you morons fully privatise the place,i’m thinking the £8.00 fee would at least double.

  20. editor says:

    Welcome back tax man. No response on whether you had a British car or British clothes? I thought it was Mandelson who wanted to privatise Royal Mail? No?

  21. The tax man again says:

    Ok i'll answer yours if you answer mine,i've no car,what with the enviorment and all that,and yes my clothes are made in the UK.

    Mandy said part,you plums said fulll!!!

  22. editor says:

    No car.. of course. Must take alot of time to hunt out those UK produced clothes. Didn't realise we had that many textiles produced in the UK these days. You will have to tell me what retailer you can get them all from.

    Wasn't it a Labour Government who have presided over around 8,000 post office closures. Royal Mail Group – safe in their hands!

  23. shane says:

    ok for the editing moron.AGAIN.
    THE 8 POUNDS is because you tried to evade paying tax(ignorance is no defense).royal mail are FORCED to employe people to handle,open,checkand re package parcels deemed suspicious by customs.if its been declared correctly no charge is ever made but for people such as yourself who have it sent falsly declaring value or origns then royal mail are forced into collecting the tax on customs behalf.AGAIN the eight ponds pays for the running of all of these units,staff ,and everything else…
    it aint rockets science.

    as for the moronic also is a business and is looking after its balance sheet .less member =less they will try to block any and all change that threatens it.for the good or the bad of the company.BUT being a part time postie(30hrs)im screwed left right and center by royal mail.forced bullied and threatened if i dare to have the nerve to actually expect to work just the hours im paid for.i could do 48 hours a week,every week but if i take leave i only get 30 hrs pay as all overtime is voluntary.i hate the union and am a rabbid tory but it really is the lesser of two evils.350 years to get to this is sickening.
    id privatise the whole lot tommorow and watch it turn to dust.then i might finally get a saturday off..

    i hope that explains your 8 pounds you tax dodger

  24. editor says:

    No – you have again woefully been able to articulate why an £8 charge is appropriate. I would suggest the man hours and teams needed to post a parcel thousands of miles is higher than what is needed to collect £9 yet the cost of collecting the nine pounds is double the cost of getting a parcel from across the Atlantic. Perhaps it shows a gross inefficiency in the system.

    Again the parcel was not opened so your cost for opening and looking into parcels is not valid.

    So explain to me and all people who use ebay and all people who purchase things from abroad and receive parcels from family members abroad how I pay tax BEFORE I have received an item given I will have NO knowledge of its value and therefore the liable VAT.

    Funny how I have been charged the fee when I have received an unexpected gift. So are you a tax dodger when you receive a package you don't know is coming? According to your warped logic yes. Suggest you check out many of the other commenst hundreds of YOUR customers have about this issue. Plenty of feedback on many websites.

    Again you fail to show how £8 is a fair charge? What not £4 or according to your logic it could be £20, given

    With respect – perhaps being a postie isnt the right career for you if you don't like working Saturdays. Then again a final salary pension scheme is rather attractive to those of us not in the public sector. Of course the deficit in the fund is another reason why private funds are needed for Royal Mail.

  25. shane says:

    being a postie isnt the job i ever wanted more needed as the last 2 jobs went bankrupt.i thought this would be redudancy proof.oh how wrong was i.NO postie i know wants to work saturday either.

    as for the pension.with respect you clearly havnt been a postie for some years.the final salary pension is no more.its now a carrer defined pension scheme.basicly part timers have just lost a third of what they would have had.the very large pension deficit as i hope we all know is due to the last tory government giving royal mail and pension holiday because ours like evryone elses pension pots had such vast surplusses.then came the lie-bour party who slapped taxes on all pensions.even when the holes began to form,still allowed royal mail to make NO contributions.17 years in total of non payments.that and this government wanting to lead europe by opening up our postal market to competion when the rest of europe wouldnt,are the sole reasons for the massive deficit and need to privatise.
    oh plus if they do privatise the government get their hands on the 22 billion pounds thats in the pension fund as they will pay future pension from taxes not the fund..wonder why they want 22 billion pounds??????

    anyway i digress….x ray machines ,maintenance,staffing,rents rates and on and on all needed because people such as yourself try to cheat the are the importer so you pay the fees.ignorance is no defense.if you dont know how to pay for importing good correctly look it up..dont go off blaming others for your mistakes

  26. shane says:

    i am truely sorry for my woeful typing by the way.when reading back i feel i should have been flogged more often at school.arnt you glad they banned it.or maybe it was taking away my half pint of milk

  27. editor says:

    I always use the excuse that my hands can't keep up with the brain… must be a sign of intelligence.

  28. The tax man is back says:


    This is funny LOL again.

    And why are you quoting labour to me,anyway you plums started the PO rot.

    Actually if you don't mind me asking,what is your job.

  29. editor says:

    Shane again you miss the point. The xray machines are not needed to collect VAT. Xray machines are part of the equipment a post office operation needs anyway. They are used to stop drugs weapons and all sorts, so that argument is a straw man.

    And again you accuse me of "cheating the system" which is fairly offensive. You do know businesses collect VAT and then pay it after collection – not before.

    So again I ask the question. If you are sent a gift and have no knowledge it is a) coming b) value how can you pay the VAT without incurring a fixed £8 Royal Mail fee. As according to you – people are cheating the system if they are charged the £8 which is wholly inaccurate.

    The Conservatives started the PO rot? Funny – when I worked there at Head Office 2001 ish there were 19,000 post offices and a surplus in the pension fund. Hardly a rot at that time.

  30. The tax dude says:

    Oh for gods sake,you on a one man,or girley mission to slag off RM.

    It was 8 spondoolies for christs sake,you bought a pen for £60 live with it.

    Oh and what's wrong with BRITISH pens.

    Oh and you've got me,me pants are from china,i'll admit that.:(

    PS:Tory HQ 2001,2009 now,so what you doing now cleaning kazis!

  31. editor says:

    When I said there I meant Royal Mail headquarters.

    Think Royal Mail could be great (again). It needs reforms – and charges like this do not endear itself to customers who at some point will have a choice and can use FedEc UPS, and so on.

    Kazi cleaner.. about right yes.

  32. The tax bloke says:


    Don't worry,that orrible union is gettin them lazy posties out on strike so the £8 will seem a distant memory soon.

    Do you use a toilet duck?

  33. RM Manager says:

    I would, on behalf of my fellow managers, like to say thankyou to people who helped pay my £9000 bonus this year, I hope they put the charge up next year because I'm looking to buy a new BMW next year.

  34. The tax dodger bloke says:

    Whayy heyyyy screws on the prowl!

  35. Talisker says:

    Dear Sir,
    As a postie I dont have the slightest clue what criteria is used to pick a courier when items coming from abroad. I bought a jacket about 9 years ago whose value was $300 plus $53 postage. Fedex was the courier used in this instance and I was hit for £20 charge plus the vat. This was 9 years ago!!! I think that the whole system of customs is wrong but believe it or not I think you struck lucky by getting Royal Mail with it's £8 charge as opposed to the other couriers. I may be wrong but I think RM is the cheapest. Feel free to investigate and get back to me. If I am wrong I will be happy to apologise.

  36. k66yla says:

    Perhaps you should of bought a British pen then you would not of been charged £8. £60 is an obscene amount of money to spend on a pen, I do hope you are not putting it on your expenses.

  37. RM Manager says:

    £60 for a pen seems reasonable, that's only 7.5 times the handling fee. Anyway, I've got loadzamoney with my bonus so I can afford some nice pens (and being in the position that I am I wont even be paying the customs charge).

  38. editor says:

    You guys are so funny! Again I'm not sure why people seem to think you can replace the word have with of? But I digress. I do love your message board:-

  39. k66yla says:

    Oh I am so very sorry,… 'Perhaps you should have purchased a nice British pen as one may have not have had to pay the extortionate amount of £8, one hopes one is not putting the amount of 60GBP in to ones expenses department.'

  40. POSTMAN says:

    Tory boy said
    on August 6, 2009

    You guys are so funny! Again I’m not sure why people seem to think you can replace the word have with of? But I digress. I do love your message board:-

    Gee thanks 🙂

  41. Al says:

    I got a £5.01 VAT bill on items bought in the US. Including cost of items and VAT (postage was free on an order over $50) it was still cheaper than buying the same items in the UK. But add on Royal Mail's extortion and it suddenly gets expensive. Perhaps this fee is just a government way of trying to prevent us from buying at a better price in another country. However, the fee is a fixed amount and in my case there is no postage to pay so in future I will mitigate the loss by placing much larger orders. Sorry Mandelson, you lose again.

  42. Wibble says:

    Rather like WitchEnd, I too received a card from my local post office informing me that they were unable to deliver an item as there was postage due. The sender had underpaid by 8p so I am being asked for £1.08 including the RM's administrative fee. I find this rather excessive – and as I know from previous experience that they won't give me any information about the item – I shall let them return it to the sender.

  43. lisa says:

    Just received a teeshirt and fleece top ordered from USA – they don't do them in good old rip off Britain for my daughter for xmas.
    Happily paid for them and the shipping when i ordered them…..only to find a grey card from Royal Mail today ….left on my doormat and soaking wet – obviously too much trouble for them to put in the postbox next to the door or even god help them through the letterbox! charge for customs £13.14! turns out VAT £5.14 and an £8.00 handling charge!!! how the devil do they justify that?
    We next time my mail is left on the doorstep or hanging out of my post box (which it is quite often) I will find out if I can fine them for leaving my personal details at risk….not funny if it was a bank statement , credit card bill etc. Maybe when the postman/woman (or should that be postperson!!) leaves my mail in their hand when walking around the houses so it gets soaking wet – shall i charge them a drying fee? oh yes and what about when they take a shortcut across my front garden trampling my grass – even making a little path for themselves in this wet weather – shall i charge them a fee for viewing my living room and entering a private lawned area!!!! all totally stupid and pointless but so is their bl**dy handling fee!

  44. huw williams says:

    The royal mail has just tried to charge my mum a £1 handling fee on a letter that was somehow slightly to big and so should had 8p
    more. That is 1250% of the missing amount , for not delivering and forcing her to go to the sorting depot which is outside the town centre of another town(rather than the post office in the town).

  45. Darren says:

    Just got ripped off by Royal Mail too, I've put in a complaint to trading standards regarding this one as I believe Royal Mail may be breaking the law.

    The card we got clearly stated on it that a £1 HANDLING FEE applied. However when I went to get the item it was actually £8 'cos it was a customs handling fee.

    No where on that card did it state that the handling fee would be £8, and the person at the desk told me it doesn't have to. The handling fee they print on the card is for unpaid items, not for customs charges.

    This is probably quite misleading and breaking trading standards laws, as to state one handling fee on the card and then to be charged a totally different handling fee just isn't on.

    It's very misleading for the customer, and so I've put a complaint in to both Royal Mail and Trading Standards to see if I can get the rest of the £7 back. This is like altering a legally binding contract after the deal has been done.

    That card constitutes part of the contract, and on the card it clearly states that the handling fee is £1 not £8. Therefore in effect the charge is actually null and void. Hopefully I get the full £8 back.

    Also anyone else who's had to pay the £8 might want to try this, quite sure everyone has a strong legal case to get their money back, until Royal Mail print new cards stating that the customs handling fee is £8 and the underpaid items handling fee is £1.

  46. Darren says:

    btw – Huw Williams – you don't need to go to the sorting office to collect a parcel that is underpaid, you can pay the money online or over the phone and then they will re-deliver it for you.

    Had I not wanted my item today I would have done that with my item and made Royal Mail work for their £1 or £8 or whatever they're feel like charging.

  47. Joe Bloggs says:

    How about good old Royal Fail stop bullshitting UK consumers and give us the real cost of all this "extra" work they have to do and start charging something more proportionate? If I order an item from abroad, I have already paid for that item to be delivered right to my front door. If Customs think I owe Duty & V.A.T., I have no problem paying it to them.

    What I DO have a problem is not having a choice as to how that money gets to Customs. Did I ask Royal Fail to pay this money on my behalf? No, I'm betting no-one else does either. How about Customs hold my parcel till I pay THEM anything owed and then release it Roya Fail for delivery? Oh wait, then the wankers don't get to charge me £8 for doing what amounts to basically sweet f all. Rip-off Britain, at a sorting centre near you.

  48. Robbed Joe Public says:

    Just been mugged by the Royal Mail too.Had a a small item sent from the U.S approx value 18.00 pounds so it's borderline as to whether VAT is payable depending on exchange rates.The charges were roughly as follows.
    Value of goods 18.00 pounds
    Costs for postage from U.S 6.00 pounds
    VAT 3.60
    Royal Mail will not deliver untill their grossly disproportionate charges are paid.
    How can the office of fair trading allow this?? ??

    I've since avoided using the Royal Mail services whenever possible, please do the same until this extortion is stopped or at least a fairer more proportionate charge is in use.

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