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[Genem]

Seeing this a day or so ago was concerning, I've checked and its not a spoof, its legitimate. This will, I suspect, have an impact on imports of all sorts of things, from Door-tops to cheap LEDs...

I saw an associated article about William Shatners "Star Trek" related shop, deciding not to export to the UK any more, the cost of setting up a system to pay VAT from the US to HMRC was not worth the effort.

[w3526602]

Hi,

Barbara made contact with a long lost cousin in USA (Indiana) thru her geneology searches.

Coz is obviously "better heeled" than us Brits, as Barbara received a "billet doux" from the Post Office saying that they were holding a parcel at the local sorting office until she paid the various fees ... Customs Duty, plus Handling Charge plus VAT on the handling charge. Please bring this card plus £30 to the sorting office.

The handling charge was £8 + VAT. Sorting Office was 10 miles away.

Coz was miffed that Barbara knew the price of the gift.

Barbara begged Coz to wind her wallet in a bit, as we couldn't afford the presents ... but the prezzies keep coming.

602

[RobS]

Seeing this a day or so ago was concerning, I've checked and its not a spoof, its legitimate. This will, I suspect, have an impact on imports of all sorts of things, from Door-tops to cheap LEDs...

I saw an associated article about William Shatners "Star Trek" related shop, deciding not to export to the UK any more, the cost of setting up a system to pay VAT from the US to HMRC was not worth the effort.

It's going to be fun for sure, importing goods from Canada (door tops) will not change as long as it's a UK company importing the goods into the UK, vat and duty is charged on the goods by HMRC which the VAT is claimed back by the importer (or is charged directly to the buyer if they have gone direct to the supplier), then when the goods are sold here in the UK VAT is charged based on the selling price as normal.  It's Europe that is currently a sack of *&%^$ as no one really knows what will happen.

We do a lot of third party shipments out of Europe to Asia, that one will be interesting to sort out as we don't charge our customers as they are Z rated which means VAT is not applied.

It will be all about how quickly trading agreements are put in place.

RobS

[Rob_W]

I was reading it as the US supplier would need to charge the VAT and then pay HMRC the VAT?  Or is it an ambiguous article and the Gov guidance is clearer? 

[RobS]

I was reading it as the US supplier would need to charge the VAT and then pay HMRC the VAT?  Or is it an ambiguous article and the Gov guidance is clearer?

As I said it depends on the trade agreement, but the government already charges VAT on goods coming here from the US, it's charged to the customer, who if he's VAT registered, claims it back, then when the goods are sold here in the UK the seller charges the end users VAT (based on buying price plus profit) and they are responsible for paying the VAT to HMRC. 

RobS

[AlexB]

It's going to affect any musician / band who tours europe and want s to sell merchandise

Who ever voted for this state of affairs?

[agg221]

As I said it depends on the trade agreement, but the government already charges VAT on goods coming here from the US, it's charged to the customer, who if he's VAT registered, claims it back, then when the goods are sold here in the UK the seller charges the end users VAT (based on buying price plus profit) and they are responsible for paying the VAT to HMRC. 

RobS

If I'm reading the guidance correctly, the difference would appear to be where a customer in the UK wants to buy from a seller in, say, the US.

At present, if I buy a LR component from the US or Malaysia and it is under £15, I pay nothing when it arrives. If it is over £15 I pay the VAT plus the handling fee. In future, for me to buy the component at all, the company selling it will have to have pre-registered for VAT in the UK. If they choose not to, they can no longer sell to me in the UK at all.

Where I am anticipating the major headache if my interpretation is correct is if I buy something from Europe (say the Cyprus-based seller of LR parts on Ebay) and he has not realised he needed to register. I have paid for it but what happens to my parcel when it reaches the border and they establish that he is not registered? Does it get sent back at his cost? My cost? Impounded and vanish into a Customs & Excise hole forever and either he or I loses our money?

There was a point a few years ago when HMRC decided to do away with local tax offices and centralised everything in Wales to save money. The self-assessment forms arrived faster than they could process them, to the point where they had sackfuls of unprocessed forms. They then issued fines for late payment because they hadn't found the forms. When you wrote a complaint letter, they didn't answer it because they couldn't process the letters. In the end, I started getting letters threatening bailiffs, so I went through the external complaints procedure (one step before the ombudsman) who advised me on what to write and to whom to send it. This resolved the matter. I see no reason to believe that the new system is any better thought through than the above example.

It does make a mockery of the 'Britain's Open for Business' campaign doesn't it.

Alec

p.s. an aside, but if you go to the government website and try to establish what the entry requirements will be for different countries in Europe when travelling on business, it has no answers but points at websites in whichever country you are considering, in the language of that country, which also do not contain the information. Chaos does not begin to describe it.

[Wittsend]

It will be all about how quickly trading agreements are put in place.

RobS

 

[RobS]

If I'm reading the guidance correctly, the difference would appear to be where a customer in the UK wants to buy from a seller in, say, the US.

Technically you need to be an importer of goods to work the system, if a US company wants to sell here directly with no third party involvement then that's a different situation, currently has it stands, HMRC would still charge you VAT and duty as the person it's been delivered too and will therefore collect the taxes. At the moment there is no guidance or change other than what has always been stated on the current rules stated by HMRC - from the releases I've seen nothing has been mentioned with regard to none EU companies registering for VAT, the only time this will apply is if they set themselves up as a trading entity here in the UK. You do need an EORI number (Economic Operators Registration and Identification number) for importing / exporting of goods to outside the EU but in the future you will need one for working with the EU as well.

The big change is importing and exporting to the EU, currently the discussion / guidelines is we Zero rate the sales to the EU which will make our goods cheaper to buy if in the EU, it depends on what the EU does in response to this - this is the grey area.

It's still a bag of balls which are still up in the air, a lot of the papers are just second guessing and generally making a mountain out of a mole hill - which as far as they are concerned sells papers.

I think I've had a bulletin every day for the past week reminding me on to be prepared.

RobS

[ChrisJC]

Who ever voted for this state of affairs?

Me.