For those of you living in the United Kingdom please note that the operation of the customs department within the Royal Mail and the interface with Jersey Post has changed.
In the latter half of 2011 during the argument against LVCR (low value consignment relief) it seems that UK Customs and Excise together with the Royal Mail decided to put maximum effort in to processing parcels and packets arriving from the Channel Islands. LVCR had set a de-minimis value of around £18 at which it had been decided that it was not worth the effort of processing VAT collection and even before the formal loss of the LCVR argument many more consignments were being subject to arbitary delays and nuisance tactics such as not attempting to deliver and instead leaving a card expecting the recipient to collect from a regional sorting office. Whether it was "suggested" by Royal Mail/Customs or Jersey Post I would not know but in 2012 Jersey Post has started to act as a VAT collection agent.
The situation with higher value letters packets and parcels seems to be as follows:
When a packet or parcel is sent to the UK any VAT due may optionally be pre-paid.
If it is pre-paid it is at the standard (20%) rate and the package receives a "prepaid" sticker and should then be delivered without undue delay and without any further charges.
If it is not pre-paid then UK customs may (treat as very likely) raise an import duty (VAT) charge on it at 20% and, if delivered by Parcelforce, will most likely add an extra £8 "processing fee" on top of that. Letter packets might possibly escape the processing fee. If the letter or parcel delivery service hands you the packet without raising a charge then it means that VAT is not being charged in that instance (lucky you).
For the moment I have decided to show my pricing without adding the VAT because my more local customers and those in countries other than the UK get no benefit from having to adjust the prices back down before possibly adding their particular import duty rates back on. In due course I will probably have an equivalent set of pages with VAT inclusive prices.
If you are a customer that falls within the UK VAT net please be aware of the option of pre-paying the VAT, once an item has gone over the counter it is on it's way and if the VAT has not been pre-paid and you get hit with a "processing fee" there is not much that I can do about it.