Post-Brexit trade deal - Customs?

[kitesurfer2]

Expecting every small foreign supplier to register for UK VAT why would they?
This is dumb and cutting off billions in trade to recover £300m sums up the lack of practical common sense in this government, IMHO basically the government could not be relied on to organise a beer party!
What next..

[gridgway]

But is that right? I've not heard of it from anywhere else

[911hillclimber]

Think it is Graham, and possibly why the little German company would not take payment for the £10 order?
IF it IS true, many Euro companies wont bother unless it is worth their while.

I'm sure there will be much bigger issues unfold this year on post-Brexit.

[inaglasshouse]

I am pretty sure that the small German company has the option of selling via Amazon or eBay, in which case it's the intermediary's responsibility to collect the VAT (and the vendor does not need to register for UK VAT). But only for low value stuff, up to 150-ish Euro.

[gridgway]

seems to make sense. Looks like I have little chance of buying my sight correcting lenses to go in my VR headset from "VR Optician" the go-to people in Germany! I'll see how I get on.

[Lightweight_911]

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I've just had this message from a seller in Italy that I was trying to persuade shipping an item to the UK:

"Hello the carrier replied to me the cost is 40 EUR but the UK is non-EU and an invoice is required for customs.

I cannot issue an invoice, because I'm a private individual.

I can't sell in the UK now that it's non-EU.

Greetings"

There are/will be ways around this but in the meantime I have a feeling that this is going to be a frequent response ...

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[Bootsy]

Yes, until things settle and it's clearer on how and what to do there will be a lot of this

[904GTS]

This article is quite a good explanation of the new system, the EU is doing something similar but starting in July, it seems the main target is the large amount of imports coming from China which are often avoiding VAT. Unfortunately it is catching small businesses selling directly to consumers and making them account for VAT directly to HMRC, there doesn't appear to be an option for the consumer to pay the VAT on import (usually via the courier/post office) , presumably the courier/post in the seller's country will only accept shipments which comply. If selling via online market places like Ebay, they will be responsible for collecting the VAT and paying it to HMRC .

https://www.accountingweb.co.uk/tax/bus ... -stop-shop

Presumably in response to these changes Ebay have recently changed how sellers get paid :-

"eBay will now manage how you get paid, this means that fees and expenses will be deducted before you get paid. The remainder of your eBay earnings will go directly into your bank account, not your PayPal account."

so they will deduct the VAT from the overseas seller and pay them the net amount, where the overseas seller is not a business ebay will add the VAT to the selling price and the buyer will pay it to ebay, there is a note on listing to warn the buyer if this is the case.

It would seem the burden is on the courier to determine whether VAT needs to be collected at import or not.

All the above applies to purchases less than £135, above that the courier will account for the VAT on import and collect it from the purchaser as has been the case for non EU imports previously.
Fortunately business to business transactions are largely the same as before, albeit with more "paperwork" involved.

In essence the days of dodging the VAT are gone, no doubt there will be a degree of chaos before things settle down and understandably it won't be worthwhile for very small overseas businesses to sell directly to UK consumers except through the likes of ebay and Amazon.

Happy days !

[904GTS]

Following on to the above I have just made a purchase on ebay and my Paypal payment has gone to ebay not the seller, I wonder how this will affect the degree of protection provided by Paypal ?

[gridgway]

where the overseas seller is not a business ebay will add the VAT to the selling price and the buyer will pay it to ebay

Does that mean that private sales from outside the UK effectively get a 20% tariff? That's a strange side-effect.

[Jonny Hart]

Anyone care to comment on why we have seen a surge of EU non-business orders since Jan 1?

Since Jan 1, we no longer charge VAT to EU customers. My thoughts are that perhaps it is easier to reclaim VAT if it was charged in their own country. A pessimist might say it’s because they don’t realise that they will be charged VAT on import.

[Lightweight_911]

Does that mean that private sales from outside the UK effectively get a 20% tariff? That's a strange side-effect.

No - ebay will add 20% (VAT) to the selling price at check-out which they pass on to HMRC (presumably for a handling fee).

Direct sales will have the VAT collected from you by the courier (+ a handling fee) on arrival in the UK - same as current US imported goods being delivered here by Parcelforce, etc.


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[knapmann]

Obviously I have been totally naieve to all of this. I thought the whole idea of getting a deal was that we could buy and sell goods into/from europe without paying taxes, thats what Boris has been promising me all this time as far as I was concerned. Now you're all saying we will be paying 20% taxes on everything... and we all know how many parts we get from europe which are already expensive enough. This is a massive kick in the balls as far as Im concerned. I dont see why we should be paying 20%VAT when buying used goods from private individuals no matter the circumstances or where they are from. If I sell my broken lawnmower to my neighbour for 20 quid I dont change him VAT do I... they had the VAT on it once years ago, and im not running a business in lawnmower parts sales. If true this really pisses me off, as I have an expensive package on its way from France as I type

And dont get me started on handling fees...

[anglophone1]

Anyone care to comment on why we have seen a surge of EU non-business orders since Jan 1?

Since Jan 1, we no longer charge VAT to EU customers. My thoughts are that perhaps it is easier to reclaim VAT if it was charged in their own country. A pessimist might say it’s because they don’t realise that they will be charged VAT on import.

I’d say the latter Jonny-how does a private EU individual reclaim VAT?

[gridgway]

Does that mean that private sales from outside the UK effectively get a 20% tariff? That's a strange side-effect.

No - ebay will add 20% (VAT) to the selling price at check-out which they pass on to HMRC (presumably for a handling fee).

Direct sales will have the VAT collected from you by the courier (+ a handling fee) on arrival in the UK - same as current US imported goods being delivered here by Parcelforce, etc.

I didn't express myself very well. I meant the same that private sales from outside the UK will now attract 20% VAT (to go HMRC) so are 20% more expensive for us than pre brexit - ie a 20% tariff.
Graham