A post brexit question.

[EBS_freak]

10 minutes ago, Mikey D said:

[EBS_freak]

1 minute ago, ambient said:

No, the courier will pay the VAT for you, then claim it back from you along with a handling charge. They’ll then release your item and deliver it to you.

That depends.

[EBS_freak]

3 minutes ago, geoham said:

I'm absolutely not sure of anything... an interesting read.

The points about VAT being charged at the point of sale for goods under £135 is massive and should prevent delays and handling fees on these. However, based on my quick read of this, I think what I described will still be applicable for goods exceeding £135. 

It'll be interesting to see how the likes of Thomann deal with this, since the £135 is per consignment - so a £120 bass shipped alone would require them to charge UK VAT, but add on a £20 of strings to the same order and VAT will instead be charged upon import.

I think I'll be buying locally to avoid problems, and I suspect this may be their intention.

George

 

[Steve Browning]

3 minutes ago, Leonard Smalls said:

It's not a link, just a quote from this:

https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

That's just a policy paper. It doesn't have the force of Law. I was trying to attach an up to date link but all the HMRC links are dead.

[Dood]

9 minutes ago, ambient said:

I’m wrong, I apologise. There’s 2% duty on them too. I’ll amend my post.

Choosing an inappropriate moment to derail this thread, I scrolled to the bottom of your quote image and all I could think of was....

I’m sorry 😂🤣

[Al Krow]

@ambient - please note the import duty is 2% "UNLESS subject to other measures" e.g. the UK / EU free trade agreement

=> no import duties on goods sold EU <--> UK in either direction

[Steve Browning]

I wonder if this can be linked to the buying/selling to the EU thread. I think that is more useful. The answer was provided ages ago and the later contributions seem to adding confusion and inaccuracy.

[Lozz196]

1 hour ago, Steve Browning said:

If you sell a bass to someone in France you charge them as normal. When you send it you fill out a Customs form and the French tax authority charge your customer French VAT on the import. The value base is the cost + carrier cost. You won't see any of those additional costs.

So in other words Steve, it’s pretty similar to buying an item from the US?

[Steve Browning]

Yes. In essence exactly the same. The agreement with the EU means there is no Customs Duty on the purchase but it's the same in all other respects.

[Leonard Smalls]

Was it Boris who famously said "F*** business?"

If so, he obviously meant it!  😀

[BaggyMan]

from the go

3 hours ago, Leonard Smalls said:

It's not a link, just a quote from this:

https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

interesting section from this reads..

The changes will not apply to consignments of goods containing excise goods or to non- commercial transactions between private individuals. Existing rules will continue to apply for these transactions.  does that mean no import tax? 

 

[BaggyMan]

So the status seems to be, no import duty for non business transactions, but VAT will be charged locally, probably paid by the courier who will add a handling charge based upon the value of the item, if its more expensive than £135.

 

[ambient]

5 minutes ago, BaggyMan said:

from the go

interesting section from this reads..

The changes will not apply to consignments of goods containing excise goods or to non- commercial transactions between private individuals. Existing rules will continue to apply for these transactions.  does that mean no import tax? 

 

That’s how I read what I posted from the Gov website. You’ll obviously pay VAT - which you didn’t before on used goods - plus a handling charge. I’m pretty certain there’s no additional duty.

[Steve Browning]

As I have said, this is nothing but a policy document. It tells us nothing about the Law. Do not use it as any form of guidance. It is nothing of the sort.

[Newfoundfreedom]

How many different times and different threads are we going to go over this? 

 

[BaggyMan]

so working on past experience of 'handling fees'

What would have cost £1000 is now £1210   (assuming a 10 handling fee)

 

 

worth noting bearing in mind there are french/spanish and sometime Italian sellers on the forum.  Good chat thanks.

 

 

Edited January 4, 2021 by BaggyMan

[Steve Browning]

The answer was given in my 3rd post in this thread. Refer to that and you can't go wrong. 

[Steve Browning]

1 minute ago, BaggyMan said:

so working on past experience of 'handling fees'

What would have cost £1000 is now £1210   (assuming a 10 handling fee)

 

No.

[BlueMoon]

Am I correct in understanding that, while the seller (let's say in the UK) still advertises and sells the (2nd hand) item at the agreed price, the buyer (let's say in Belgium) will be required to pay local VAT on the declared cost and shipping + admin cost? So the cost to the buyer goes up by around 25%.

I think this could hit sales of cross channel BC classifieds on 2nd hand gear, won't it?

 

[Leonard Smalls]

3 minutes ago, Steve Browning said:

As I have said, this is nothing but a policy document. It tells us nothing about the Law. Do not use it as any form of guidance. It is nothing of the sort.

There's a link to the actual rules in the policy document...  https://www.gov.uk/guidance/vat-and-overseas-goods-sold-directly-to-customers-in-the-uk

Yer actual rules appear to be:

Consignments valued at £135 or less

The seller must charge and account for VAT at the point of sale, unless the consignment is a business to business sale and the customer has given them their UK VAT registration number.

To charge and account for VAT the seller will need to:

• know the precise nature of the goods to find out the correct rate of VAT to charge
• register for VAT - sellers that are already registered for VAT do not need to re-register
• keep records of the goods sold, and make sure they get accurate information to apply the correct VAT treatment to them

For goods supplied into Northern Ireland from outside the UK and EU, low value consignment relief will no longer apply and the seller will be liable to account for the VAT on the VAT return instead of at the border.

[Steve Browning]

Let me give you 2 examples (pre and post Brexit)

Private purchase

Pre

You pay £1000 on the BC forum to a seller in Germany. They send you the bass and that's it.

Post

You pay £1000 to the seller and you then get a bill for VAT on the 1000 + delivery cost + the £10 handling fee. Let's say delivery was £30 - you end up paying £1216 (£206 VAT plus the admin).

Business purchase (not Thomann for this purpose)

Pre

You pay £1190 + £30 delivery (yes, German VAT was 16% for 6 months but that's not important for this illustration). The total is £1220.

Post

You pay £1000 (the net value) + delivery + handling. The cost is as above £1216

The net effect is that the purchase through BC now costs you a lot more.

 

[BlueMoon]

1 minute ago, Steve Browning said:

The net effect is that the purchase through BC now costs you a lot more.

So it could indeed impact cross channel sales to "must have" items.

Trades presumably increase costs at both ends.

[Steve Browning]

2 minutes ago, BlueMoon said:

So it could indeed impact cross channel sales to "must have" items.

Trades presumably increase costs at both ends.

If you mean a swap of goods with a cash difference? That is two separate sales. VAT looks at each transaction on its own.

[BigRedX]

15 minutes ago, Newfoundfreedom said:

How many different times and different threads are we going to go over this? 

Given, that previously the question of import charges was asked on average once a month when the information was well known and plenty of people had actual first hand experience of the process, do not be surprised that there are now multiple threads and most people still don't know what is going to happen when they buy and sell items to/from countries outside of the UK.

AFAICS what @Steve Browning says should be correct, but right now it is just one (well-informed) person's interpretation of the rules. How others including HMRC actually interpret them once goods start moving may not be the same. 

Personally I wouldn't want to buy or sell anything aboard for a good few months until I've seen what others are actually experiencing.

[Steve Browning]

Just now, BigRedX said:

Given, that previously the question of import charges was asked on average once a month when the information was well known and plenty of people had actual first hand experience of the process, do not be surprised that there are now multiple threads and most people still don't know what is going to happen when they buy and sell items to/from countries outside of the UK.

AFAICS what @Steve Browning says should be correct, but right now it is just one (well-informed) person's interpretation of the rules. How others including HMRC actually interpret them once goods start moving may not be the same. 

Personally I wouldn't want to buy or sell anything aboard for a good few months until I've seen what others are actually experiencing.

Wise words. It makes sense to delay, if you can. Aside from anything else, HMRC are not ready for it. Let the dust settle.