Buying from the EU

[NickA]

So, Brexit.  Big changes when buying a bass, or anything else, from the EU.

As I import stuff for work, I had to look into this .. and here's what I found (corrections gladly accepted).

Buying privately

That last minute "no tariff" deal means that we avoid having to pay import (aka customs) duties, but we still have to pay VAT.  There is no exemption for 2nd hand goods.

The shippers will pay the VAT for you and then demand you pay them back before they deliver the goods; they will also add "a small administrative fee" and you have to pay VAT on that as well.

So let's say you buy a Bass from France for £3000, plus £100 delivery.  The shipper adds a £20 admin fee.  Total Bill = £3120.  Total VAT = £624.  Grand total = £3,744.

Buying from a company

If you buy from a company they should deduct the VAT from the selling price.  So that £3000 French bass should only cost £2500.  Then you pay £2500 + £100 shipping + £20 admin + £524 VAT = £3,144.  Not too bad.

The VAT rate varies from country to country eg 20% in France, 25% in Sweden, Germany 19%.  Buy from a shop in Sweden and it might be cheaper than you expect!

BUT:  there is this thing called the Marginal VAT rate for 2nd hand goods, whereby a company that bought a bass from a private buyer for £2000 and sells it for £2500 to another private buyer only pays VAT on the £500 profit (and in the UK only 16.66% VAT instead of the usual 20%); so they're not going to deduct more than £83.33.  

Ways around it?

Not a lot! 

You can get the seller to declare a false value ... then you will pay VAT on the declared value.  It's fraud of course.  But does a customs grunt know the difference between a rare vintage precision and an "antiqued" squire.

You can go collect the bass in person (post Covid!) and bring it back as hand luggage ... but if the customs people are bored or over keen they might want proof you took the bass away with you prior to bringing it back.  The official proof is a thing called an ATA Carnet - these cost over £300 (I've used them for taking tools to S Africa and Australia); you don't "have" to have one - you can just argue the toss.  But it only works if you take one bass out, bring another back and no-one spots the difference (my experience is that if you have a Carnet, they check the paperwork, but not the goods).  It's fraud of course.

Experiences

I'm interested in hearing what actually happens.  So it would be good if people buying from the EU (or elsewhere) can post their experiences below.  How much VAT were you charged, how much "admin fee" and was the shipping delayed at all?

Edited January 26, 2021 by NickA

[Steve Browning]

14 minutes ago, NickA said:

So, Brexit.  Big changes when buying a bass, or anything else, from the EU.

As I import stuff for work, I had to look into this .. and here's what I found (corrections gladly accepted).

Buying privately

That last minute "no tariff" deal means that we avoid having to pay import (aka customs) duties, but we still have to pay VAT.  There is no exemption for 2nd hand goods.

The shippers will pay the VAT for you and then demand you pay them back before they deliver the goods; they will also add "a small administrative fee" and you have to pay VAT on that as well.

So let's say you buy a Bass from France for £3000, plus £100 delivery.  The shipper adds a £20 admin fee.  Total Bill = £3120.  Total VAT = £624.  Grand total = £3,744.

Buying from a company

If you buy from a company they should deduct the VAT from the selling price.  So that £3000 French bass should only cost £2500.  Then you pay £2500 + £100 shipping + £20 admin + £524 VAT = £3,144.  Not too bad.

The VAT rate varies from country to country eg 20% in France, 25% in Sweden, Germany 19%.  Buy from a shop in Sweden and it might be cheaper than you expect!

BUT:  there is this thing called the Marginal VAT rate for 2nd hand goods, whereby a company that bought a bass from a private buyer for £2000 and sells it for £2500 to another private buyer only pays VAT on the £500 profit (and in the UK only 16.66% VAT instead of the usual 20%); so they're not going to deduct more than £83.33.  

Ways around it?

Not a lot! 

You can get the seller to declare a false value ... then you will pay VAT on the declared value.  It's fraud of course.  But does a customs grunt know the difference between a rare vintage precision and an "antiqued" squire.

You can go collect the bass in person (post Covid!) and bring it back as hand luggage ... but if the customs people are bored or over keen they might want proof you took the bass away with you prior to bringing it back.  The official proof is a thing called an ATA Carnet - these cost over £300 (I've used them for taking tools to S Africa and Australia); you don't "have" to have one - you can just argue the toss.  But it only works if you take one bass out, bring another back and no-one spots the difference (my experience is that if you have a Carnet, they check the paperwork, but not the goods).  It's fraud of course.

Experiences

I'm interested in hearing what actually happens.  So it would be good if people buying from the EU (or elsewhere) can post their experiences below.  How much VAT were you charged, how much "admin fee" and was the shipping delayed at all?

You'd be an idiot to falsify the value. I used to work for Customs and I was not the only one who would know exactly the value of something.

[ambient]

2 hours ago, NickA said:

So, Brexit.  Big changes when buying a bass, or anything else, from the EU.

As I import stuff for work, I had to look into this .. and here's what I found (corrections gladly accepted).

Buying privately

That last minute "no tariff" deal means that we avoid having to pay import (aka customs) duties, but we still have to pay VAT.  There is no exemption for 2nd hand goods.

The shippers will pay the VAT for you and then demand you pay them back before they deliver the goods; they will also add "a small administrative fee" and you have to pay VAT on that as well.

So let's say you buy a Bass from France for £3000, plus £100 delivery.  The shipper adds a £20 admin fee.  Total Bill = £3120.  Total VAT = £624.  Grand total = £3,744.

Buying from a company

If you buy from a company they should deduct the VAT from the selling price.  So that £3000 French bass should only cost £2500.  Then you pay £2500 + £100 shipping + £20 admin + £524 VAT = £3,144.  Not too bad.

The VAT rate varies from country to country eg 20% in France, 25% in Sweden, Germany 19%.  Buy from a shop in Sweden and it might be cheaper than you expect!

BUT:  there is this thing called the Marginal VAT rate for 2nd hand goods, whereby a company that bought a bass from a private buyer for £2000 and sells it for £2500 to another private buyer only pays VAT on the £500 profit (and in the UK only 16.66% VAT instead of the usual 20%); so they're not going to deduct more than £83.33.  

Ways around it?

Not a lot! 

You can get the seller to declare a false value ... then you will pay VAT on the declared value.  It's fraud of course.  But does a customs grunt know the difference between a rare vintage precision and an "antiqued" squire.

You can go collect the bass in person (post Covid!) and bring it back as hand luggage ... but if the customs people are bored or over keen they might want proof you took the bass away with you prior to bringing it back.  The official proof is a thing called an ATA Carnet - these cost over £300 (I've used them for taking tools to S Africa and Australia); you don't "have" to have one - you can just argue the toss.  But it only works if you take one bass out, bring another back and no-one spots the difference (my experience is that if you have a Carnet, they check the paperwork, but not the goods).  It's fraud of course.

Experiences

I'm interested in hearing what actually happens.  So it would be good if people buying from the EU (or elsewhere) can post their experiences below.  How much VAT were you charged, how much "admin fee" and was the shipping delayed at all?

You’d be a little daft to falsify the value, particularly if it’s an expensive instrument. You can’t give the real value for the insurance, and then a lower value for customs. 

[ambient]

There’s also a limit before the VAT is paid by the courier. If the item is below £135 then it’s paid to the seller - they need to register for UK VAT to do this. Consequently many are now refusing to ship low cost items to the UK. If it’s over £135 that when the VAT is paid by the courier etc,

[ambient]

There’s a good explainer here.

https://www.theguardian.com/money/2021/jan/21/eu-website-purchases-the-import-charges-uk-customers-have-to-pay

[tubbybloke68]

I posted my recent experience on another thread but in case anyone missed it.
posted a bass to Corsica (France) couple of weeks ago.Absolutely first class service by fedex (£130)express delivery,insurance by secusus but luckily no problems.Bass was just under 5 grand.Buyer had to pay french import tax plus handling charges which added up to €1375 before the bass left this country.so I would presume it would roughly be the same the other way round for anyone receiving from the EU now 

[silverfoxnik]

Not sure if this helpful or not, but thought I'd share it just in case... 

https://www.bbc.co.uk/news/business-55752541

[ambient]

6 minutes ago, tubbybloke68 said:

I posted my recent experience on another thread but in case anyone missed it.
posted a bass to Corsica (France) couple of weeks ago.Absolutely first class service by fedex (£130)express delivery,insurance by secusus but luckily no problems.Bass was just under 5 grand.Buyer had to pay french import tax plus handling charges which added up to €1375 before the bass left this country.so I would presume it would roughly be the same the other way round for anyone receiving from the EU now 

That’s a lot extra isn’t it? I hope it wasn’t too unexpected. I noticed a couple of adverts in the sales section stating EU only, obviously for this reason.

[NickA]

3 hours ago, Steve Browning said:

You'd be an idiot to falsify the value. I used to work for Customs and I was not the only one who would know exactly the value of something

Quite:  I wouldn't recommend it.  you may get unlucky with the customs people and lose an expensive instrument.

A friend went to live in Korea and took a load of vintage port with him (bankers, honestly); told customs the wine wasn't worth much being a) old, and b) Portugese;  Korean customs were fine with that!  But much stricter on camcorders (as the Koreans made those).

When I lived out there myself I used to buy cameras, laptops etc in Singapore, claim the VAT back at the airport and just carry them into the UK; but everyone has cameras and laptops; so they don't question you.  A couple of Alembics might be more obvious!

[EBS_freak]

You'd be stupid to falsify the value. You never know who is on basschat that works for HMRC.

Edited January 26, 2021 by EBS_freak

[Steve Browning]

3 minutes ago, EBS_freak said:

You'd be stupid to falsify the value. You never know who is on basschat that work for HMRC.

Used to, in fairness.

Of course the real point is that you're trying to convince someone else to do it.

[EBS_freak]

I know of somebody who is - although to be fair, they don't seem to be around too much of late.

Falsifying documents is on a hiding to nothing - especially if you get caught.

 

Anyway, funny story about somebody trying to pull a fast one. The wife of a basschatter on here used to be the claims handler for a sizeable insurance company and out of the blue, I got a message saying, "what do you reckon this is?" from the fellow Basschatter.

What it was, on face value, was a picture of a genuine Fender J bass with a close up of the headstock stating P bass with maybe some modifications. He was claiming for a USA P bass of a much, much higher value. We thought it may have been a bitsa but it piqued our interest enough to have a closer look.

Given the guys telephone manner, the wife had her suspicions about the validity of the claim. We mused over the photo and figured out that it was a bastardised Mark Hoppus bass and what was being claimed for was a much, much more expensive USA P bass. I would loved to have been a fly on the wall when he got the message, that despite his attempt at defrauding the insurance company, they would honour the payment out for a Mark Hoppus bass.

Bet the guy thought he was quids in when he had a seemingly wet behind the ears when it comes to basses claims handler. Just goes to show eh? You never know who's eyes things end up under.

Edited January 26, 2021 by EBS_freak

[stingrayPete1977]

It even had us baffled for a while didn't it! He'd probably be even more surprised to find out she makes Donuts in a bakery and he might have got away with it at any other time! 

[richardd]

Does that mean stuff like Sandberg will have an increase,How will dealers work? 

[NickA]

2 hours ago, richardd said:

Does that mean stuff like Sandberg will have an increase,How will dealers work? 

Transactions between businesses are pretty much unaffected, though there is more paper work to do.  Sandberg can knock off Germany's 19% vat and the UK dealer can add our 20%.

Difficult I guess for someone like bass direct who import a Smith, say, from the USA and then want to export it to a buyer in the EU ... It's not made in the UK, so EU import duties apply as well as VAT.  Who'd buy from a UK company?

[ambient]

5 minutes ago, NickA said:

Transactions between businesses are pretty much unaffected, though there is more paper work to do.  Sandberg can knock off Germany's 19% vat and the UK dealer can add our 20%.

Difficult I guess for someone like bass direct who import a Smith, say, from the USA and then want to export it to a buyer in the EU ... It's not made in the UK, so EU import duties apply as well as VAT.  Who'd buy from a UK company?

I didn’t realise that. I know Mark’s been complaining. I sad an advert in the sales section here saying EU sales only - can’t be bothered with the paperwork I guess.

[Grahambythesea]

How is this working for elsewhere? I seem to remember a year or so back Japan agreed a free trade deal with EU.  I’ve never imported from Japan so don’t know if back then imports became Tax free. If they did had Brexit knocked that on the head?

[Pseudonym]

2 hours ago, Grahambythesea said:

How is this working for elsewhere? I seem to remember a year or so back Japan agreed a free trade deal with EU.  I’ve never imported from Japan so don’t know if back then imports became Tax free. If they did had Brexit knocked that on the head?

The underlying problem is that the amount of confusion, ambiguity and doubt makes a transatlantic purchase too annoying to complete, for me at least. Too many things in flux, too much scope for nasty surprises for reasons beyond one's control. Life's too short. A lot of this will probably settle down, but in the meantime it does discourage international custom. I have suspended all purchases from the UK for the time being. I'm buying German and Italian instead. I feel sorry for British businesses trying to deal with all this, and for anyone trying to execute ostensibly straightforward transactions. I would buy British, but I'm neither a charity nor a masochist.

[tauzero]

9 hours ago, Grahambythesea said:

How is this working for elsewhere? I seem to remember a year or so back Japan agreed a free trade deal with EU.  I’ve never imported from Japan so don’t know if back then imports became Tax free. If they did had Brexit knocked that on the head?

Specifically in terms of Japan, the UK managed to agree a free trade deal sometime in 2020 which is roughly equivalent to the EU-Japan one. Liz Truss did insist on getting some specific stuff in there about cheese, of which we export about £100k-worth per annum to the largely lactose-intolerant Japanese.