Import Duty etc On Goods From UK After 1 January 2021

[Paul J]

https://www.artitecshop.com/en/blogs/nieuws/tripping-over-red-tape/

Due to the uncertainty surrounding Brexit and the sudden closure of the borders we see no other option as to pause our webshop orders to the UK from 21 December 2020. We have disabled the UK as a destination until we are able to comply with the new rules. Click for more information.

The main reason is the new UK VAT regime. Businesses selling goods to be imported into the UK with a value not exceeding £135 will be required to charge and collect any VAT due at the time of sale. Businesses selling goods to be imported into the UK will therefor be required to register for VAT in the UK.

Further reading: EU firms refuse UK deliveries over Brexit tax changes.

Backstory: "The huge change in the collection of VAT was included in a 100-page bill that mainly focused on arrangements implementing the Northern Ireland protocol for business within the UK.

It was overlooked by MPs and peers who had very little time to scrutinise the bill and were assured in an explanatory memorandum from Jesse Norman, Financial Secretary to the Treasury, that the changes would have little impact on business."

We are ever so sorry. At this moment we don't know when we can ship to you directly.

Our b2b supply chain has not been broken it seems. To order our products from within the UK we kindly ask you to contact John Ayrey Die Casts or A&H Models.

As I said earlier, this HMRC policy should be on death row. Normally, this sort of policy would be killed stone dead by ministers as soon as it was proposed.

[Flange Squeal]

This is so confusing. I thought Boris had agreed a trade deal with the EU. That suggested to me that if I purchase model trains from the EU I wouldn't have to pay more than the sticker price and the postage. Am I right in thinking that now I'd have to pay the country of origin's VAT plus UK VAT?

[woodbury22uk]

This is so confusing. I thought Boris had agreed a trade deal with the EU. That suggested to me that if I purchase model trains from the EU I wouldn't have to pay more than the sticker price and the postage. Am I right in thinking that now I'd have to pay the country of origin's VAT plus UK VAT?

Your original understanding was correct, I believe, but UK government is encouraging EU retailers to register to collect the UK VAT at the point of sale, and then remit that VAT to the UK HMRC. To do this effectively the seller would need to sell at the pre-tax price plus UK VAT, plus a possible admin charge for the paperwork. If done correctly there should be no further charges when the goods arrive in the UK. The risk is that the the EU retailer will not deduct his country's VAT, will declare the base price plus VAT plus shipping etc. as the value on the CN22 form, and HMRC through Royal Mail/Parcelforce/other carrier will seek to collect UK VAT on the CN22 declared value when the goods land in the UK. The carrier will also charge for their admin. It another thing to watch out for when buying outside the UK.

[Paul J]

This is my understanding, based on what I have read.

The EU are setting up a central VAT registry, so that people within the EU pay the rate of VAT for the purchaser's member state, not that of the seller. That prevents member states undercutting each other on VAT. There remains only one body for EU traders to register, an EU-based one rather than that of the member state. All very sensible, no extra red tape for retailers other than a one-off re-registration.

The UK have set up a parallel registry for the UK only. To cuts the ins and outs of it down, the idea was that instead of the customer paying a roughly £8 handling charge for any low value imports, the cost would be shifted on to Johnny Foreigner by making them register for UK VAT. The expectation was that they would do this because the UK is the most important country in the world. However, it turns out we aren't, so they aren't bothering.

The solution is to abandon this stupid system and put up with the old system which is a result of our imbecilic decision to leave the EEA as well as the EU. This means that importing from the EU would only remain viable for large orders but better than nothing. At least until the grown-ups take charge again and we go back to a sensible trading arrangement.

[daffy]

Thanks Mike and Paul, that does seem to be the situation in a couple of nutshells. I too, probably like all the other 'average Joe's' in the UK, thought the trade deal mean no real change. But then I forgot that 'our lot' had a whole year to work out how to get it wrong.

Thankfully at the moment I have nothing I need to buy (other than a long Wishlist that is under negotiation with the Chief Accountant ), so I'll sit back and wait for the dust to settle and see where the best deals are to be had, here or over the Channel.

[Paul J]

Just about the only way to get back to a system similar to before is to rejoin the EEA, which means accepting freedom of movement. An alternative might be a Turkish-style customs union, but I am not sure of the ins and outs of that.

Personally, I have no problem with freedom of movement, but most people do. They have to decide what is more important. To have freedom is to have freedom to choose, not freedom to have what you want with no strings attached.

[Richard Taylor]

This is so confusing. I thought Boris had agreed a trade deal with the EU.

Hahahahahahahahahahahahahahahaha. Oh, bless.

RT

[Flange Squeal]

Well at least I made someone laugh 😃

[dannyboy]

Taken from one of my posts in 'Ebay Madness' thread -

..... when I order anything from the UK now, I am liable to 21% VAT when it gets to Ireland and if the UK seller does not deduct the UK 20% VAT, (which one UK seller did not do when I placed an order the other day), I am paying that in the original cost price, so two lots of VAT!.....


the seller concerned is registered for VAT, (his number was on his invoice), but the packet arrived today and I was not charged Irish VAT nor duty, so the item(s) have actually cost me the same as they did prior to 31st December. 

[daffy]

Sounds good to me.

At the moment!

[longbow]

I've yet to come across a UK retailer in our hobby that refuses to deduct VAT on a non-EU order. Which is more than can be said for some high-street names.

[Paul J]

Taken from one of my posts in 'Ebay Madness' thread -

..... when I order anything from the UK now, I am liable to 21% VAT when it gets to Ireland and if the UK seller does not deduct the UK 20% VAT, (which one UK seller did not do when I placed an order the other day), I am paying that in the original cost price, so two lots of VAT!.....


the seller concerned is registered for VAT, (his number was on his invoice), but the packet arrived today and I was not charged Irish VAT nor duty, so the item(s) have actually cost me the same as they did prior to 31st December. 

At least in the UK, I think packages sometimes get through the system unscathed. They don't have a limitless capacity even before the current upheaval. Perhaps the situation is the same in the Republic of Ireland?

[carlmt]

Taken from one of my posts in 'Ebay Madness' thread -

..... when I order anything from the UK now, I am liable to 21% VAT when it gets to Ireland and if the UK seller does not deduct the UK 20% VAT, (which one UK seller did not do when I placed an order the other day), I am paying that in the original cost price, so two lots of VAT!.....


the seller concerned is registered for VAT, (his number was on his invoice), but the packet arrived today and I was not charged Irish VAT nor duty, so the item(s) have actually cost me the same as they did prior to 31st December. 

At least in the UK, I think packages sometimes get through the system unscathed. They don't have a limitless capacity even before the current upheaval. Perhaps the situation is the same in the Republic of Ireland?

Which is why HMRC are trying to get the overseas retailers to register for UK VAT and collect it on their behalf BEFORE the package is sent to the UK - hence the reason why overseas retailers are refusing to send packages to the UK now........they cannot be arsed with the agro!

[Paul J]

Taken from one of my posts in 'Ebay Madness' thread -

..... when I order anything from the UK now, I am liable to 21% VAT when it gets to Ireland and if the UK seller does not deduct the UK 20% VAT, (which one UK seller did not do when I placed an order the other day), I am paying that in the original cost price, so two lots of VAT!.....


the seller concerned is registered for VAT, (his number was on his invoice), but the packet arrived today and I was not charged Irish VAT nor duty, so the item(s) have actually cost me the same as they did prior to 31st December. 

At least in the UK, I think packages sometimes get through the system unscathed. They don't have a limitless capacity even before the current upheaval. Perhaps the situation is the same in the Republic of Ireland?

Which is why HMRC are trying to get the overseas retailers to register for UK VAT and collect it on their behalf BEFORE the package is sent to the UK - hence the reason why overseas retailers are refusing to send packages to the UK now........they cannot be arsed with the agro!

Agreed. Which makes the removal of the below £15 VAT exemption even more bizarre!

[dannyboy]

At least in the UK, I think packages sometimes get through the system unscathed. They don't have a limitless capacity even before the current upheaval. Perhaps the situation is the same in the Republic of Ireland?

Packages can get through "unscathed". I have in the past had two orders from Japan that I knew should attract the attention of the customs people - one got through, one didn't. Unfortunately, it was the more expensive one that did not get through - and that cost me about €80 in duty etc.!  . That is why, in general, I ordered anything of any value from the EU - as I said earlier, I might have to put my buying on hold, (temporarily  ).