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New VAT rules for overseas sellers supplying goods to UK customers - Any experiences yet?

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I have just read that the UK is now requiring overseas OMP's to register for VAT and to add VAT at the point of sale for UK B2C and B2B sales. As we all know some parts can not be sourced from ebay and such or if they can, it's often dispatched from China or at over inflated prices. From what I can understand a VAT number will be a requirement on the customs declaration, What I can not find is what would happen if there is no VAT number on the form, I would assume you would be issued with the dreaded Royal Mail surcharge notification for of £8.00 + the required VAT for any item purchased overseas as the allowances have been removed - I will purchase a PAS from Aliexpress as it is what I would class as a OMP and see if VAT is added at the point of sale. Could this be a tale of caution when purchasing high value items?

Edited by PC2017

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I ordered two controllers from China. They came a few days ago. No duty, no invoices, nothing different to before.

Nothing to do with bikes, but...

 

EU website purchases: the import charges UK customers have to pay

Consumers now face UK VAT, rather than local rates, as well as customs duty and courier admin charges

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

 

When I looked at Aliexpress the other day, I thought VAT was being added at time of order?

 

The small value consignment relief (£15) has gone.

 

Customs clearance can be £8 through Royal Mail but more through most others.

 

Above £135, you could also find yourself charged duties.

  • Author

from China

Did you order them before Jan 1st 2021?

 

There is three other things of note - I know of one company (not ebike related) that has removed the UK from their dispatch list - will this effect other sellers not wishing to deal with the bureaucracy?

 

I believe (not overly researched) that the EU was to bring a similar system into force in July 2021 but this has possibly been shelved due to Covid - Possible following the Dutch model (correct me if I am wrong)

 

And if overseas companies do ignore UK rules and we make a purchase in good faith we will get a RM notification and the added cost of handling.

  • Author

Customs clearance can be £8 through Royal Mail

Hopefully if the company does a lot of business with the UK then the VAT notice on the customs form Should prevent this from occurring. I will read that article. EDIT Good article a must read - Thanks oyster

Edited by PC2017

It's very early but I saw a response from a USA bike parts (motorbike - not cycle) supplier, he has decided to refuse to process any UK orders under $180.

Above this value UK customs handle any duty due - this is business as usual for him.

To process orders below this value he would have to register for a UK VAT number, collect the duty due from the customer, hold it securely, and forward it (quarterly?) to UK HMRC. He sees this as too complicated and time consuming, with the risk of something going wrong which could cost him time and money.

Anyone that has placed a bulk order for ebike parts from China would have experience of the additional duties, vat and ‘processing fee’ chargeable on their order. These costs have added around 40% to the prices listed on Chinese websites.

 

Looking at some of the prices that Chinese sellers are charging on ebay and the like there is a huge amount of tax avoidance going on!

[mention=11305]soundwave[/mention] thanks for the link, a very well presented view of why he stopped shipping to the UK.

I'd like to think UK.Gov will realise their new system is preventing UK from purchasing from overseas but I'm not convinced they will reverse or suspend their plans. Time will tell.

  • Author

It wouldn't surprise me if the USA bureaucracy magically disappears when the new POTUS has warmed his chair up and had that awkward chin wage with Boris:oops:

 

But as for the EU and China I am more concerned about the sellers that mark "gift" on the package hoping to circumvent the VAT minefield only for packages to get stopped and surcharged by greedy RM making the whole "money saving" point of buying from China null and void, not even mentioning the impossible to source parts. - Royal Mail shares are up 0.49% lets see if they go up:cool:

RMG 415.83 GBX +2.03 (0.49%)

22 Jan, 16:38 GMT ·

I bought a pair of cycling overshoes from Aliexpress at *$13.99 post free. They added $2.80 as vat which they will remit to UK (maybe!!??)

* I find I get a better £/$ exchange rate from my credit card company than if I bought directly in sterling.

CUSTOM DUTY ISSUE

We would declare a value of USD20 for most of the items (if it is not too big and heavy) to avoid custom duty issue. So for most cases nothing is to be worried about. However, in some countries (Germany, Sweden, etc.) , we feel sorry and helpless but duty may still occur, and buyer should be responsible for it. TFSAFARI would offer a coupon as a consolidation.

  • Author

declare a value of USD20

I got stung by that one, one package marked $20 at the time the exchange rate made it £15.30 or something stupid like that and I got charged however now the "up to" £15.00 allowance has now been scrapped.

 

my credit card company

Report back if you get any hassle from RM - Yer I noticed my debit card now charges 50p plus the currency rate of 2.99% but the credit card charges just 2.69% for now anyway.

 

Its appears to called notice 143

GOV

https://www.gov.uk/government/publications/notice-143-a-guide-for-international-post-users/notice-143-a-guide-for-international-post-users

Hallo

 

PayPal is ok. But we can´t deliver glue at the moment.

 

If we send only the Surrounds we can use a Letter ( € 4,50).

 

If send with Glue we have to take a Parcel and we have

 

to fullfill customs formalities that we don´t know.

 

Many Parcel Services have canceled deliveries to UK.

 

 

wtf is going on in the eu then as trying to get 2 bits of foam and some glue from Deutschland

On Friday, Europe’s largest parcel delivery network suspended its road service from the U.K. into Europe—including the Republic of Ireland, which has the EU’s only land border with the U.K. DPDgroup said the move was largely the result of new paperwork that is required to send British parcels into the EU.

 

https://fortune.com/2021/01/08/brexit-chaos-logistics-giant-dpd-pauses-uk-eu-parcel-shipments/

 

o_O

  • Author

send British parcels into the EU

I fear it'll be same which ever way round items are sent, I heard today amazon will remove some products normally sold from EU to Ireland (food supplements I believe) as the admin is too much hassle or complex for certain products, I did not pay too much attention to this so I could be wrong but I feel this is the start of a huge cluster....

Today I read on the dot gov website that as from xxth Jan 2021, imports under £135 including p&p don't attract import VAT or customs duty.

 

Does this mean the £8 royal mail customs processing fee is also gone for these items, given there's no customs 'duty' to process, or am I missing something here? After all it used to be 'keep it under £15 coming from China and you're golden" whereas now the £15 Low Value Consignment Relief (LVCR) has gone AND we're apparently still able to order bits of £2 tat from eBay arriving straight from China.

 

It's unthinkable that a £2 set of ebay clothespegs DIRECT from Shenzhen is now going to attract an £8 Royal Mail customs processing fee, right? And there's now no legal difference between that £2 clothespegs package and a £134 clothespegs package from Shenzhen, right? So does this or does this not mean that the hated £8 Royal Mail customs processing charge is also abolished for the £134 clothespegs package?

 

Jonathan M

 

EDIT - assuming the answer is "yes Jonathan, the £8 customs processing fee has gone" then what happens to the wholly China-based seller in relation to VAT (given he has to collect it somehow)?

last item i got from china was £253 ordered 1st jan and did not pay anything but there was no value of the item on the box neither was it opened.

 

but if i got it from the usa id get hammered with import duty and would of been torn open and looked at o_O

  • Author

imports under £135 including p&p don't attract import VAT or customs duty.

You had me stumped their for a while - but I THINK from very quick research and I must stress my lack of understanding here...

 

Yep its a mine field - Correct me if I am wrong - "import" VAT and VAT are different - Quote from a quick google....

 

"VAT on imported goods is paid directly to HMRC, while domestic VAT is normally paid to a supplier of goods "

 

And "customs duty" is paid on over £135 and Alcohol etc

 

Quote "Customs duty refers to the tax imposed on goods when they are transported across international borders. In simple terms, it is the tax that is levied on import and export of goods. The government uses this duty to raise its revenues, safeguard domestic industries, and regulate movement of goods."

 

You still have to pay VAT and RM charges - UNLESS the company or Marketplace collected the VAT at the point of sale then the overseas company SHOULD as they file the customs declaration print a VAT registration number either the Marketplaces or their own and then THEN in theory your package should just arrive as normal NO RM CHARGES.... From my understanding of it - Some companies can not be bothered with this hassle so they've removed UK from their shipping... I think

This crossed with [mention=18050]PC2017[/mention]'s post (not sure why I didn't get the 'there are other messages' prompt.

I think we are saying pretty much the same thing?

 

One extra comment on his: I think alcohol etc may both have higher levels of VAT AND be subject to excise duty as well as VAT and Import duty?

...

 

Today I read on the dot gov website that as from xxth Jan 2021, imports under £135 including p&p don't attract import VAT or customs duty.

 

Does this mean the £8 royal mail customs processing fee is also gone for these items, given there's no customs 'duty' to process, or am I missing something here? After all it used to be 'keep it under £15 coming from China and you're golden" whereas now the £15 Low Value Consignment Relief (LVCR) has gone AND we're apparently still able to order bits of £2 tat from eBay arriving straight from China.

 

It's unthinkable that a £2 set of ebay clothespegs DIRECT from Shenzhen is now going to attract an £8 Royal Mail customs processing fee, right? And there's now no legal difference between that £2 clothespegs package and a £134 clothespegs package from Shenzhen, right? So does this or does this not mean that the hated £8 Royal Mail customs processing charge is also abolished for the £134 clothespegs package?

 

Jonathan M

 

EDIT - assuming the answer is "yes Jonathan, the £8 customs processing fee has gone" then what happens to the wholly China-based seller in relation to VAT (given he has to collect it somehow)?

 

I've just realized from other posts here that there are separate Supply Vat and Import Vat. As I read it for goods under £135 the supplier is meant to collect and pay Supply Vat. I assume that is at some percentage rate (different % for different goods), which would make the difference between your £2 and a £134 packages. If that's the case, it would certainly have been more helpful if the dot gov website you referenced had pointed it out, rather than just saying Import Vat wasn't chargeable.

 

It may be that the page

https://www.gov.uk/guidance/vat-overseas-businesses-using-an-online-marketplace-to-sell-goods-in-the-uk

covers this ... I'm just too confused (but I suspect I'm not the only person who is confused).

Edited by sjpt

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