Buying and Selling models to/from Europe

[Andy Hayter]

12 minutes ago, cbrooks122000 said:

I thought it was lower than that, either way that doesn't explain what is going on. From the post I don't know how much the parts cost, but firstly I get the impression that UK retailers are not taking off the VAT and I also get the opinion that EU Customs seem to be using it as a revenue collecting exercise. As I say it is now no different to ordering stuff from the US, but I keep reading these horror stories. As I say this is not the forum to start about this, I was just explaining what the rules are, lets face it we have been obeying them ourselves for US imports for the last god knows how many years.

My response about gifts was in response to Spiderletter's post. 

 

The situation now is no different to ordering from the US (whether you are living in the EU or the UK).  There should be no surprise by any of this.  Some of us involved in international trade tried to explain that such things would occur during the pre-referendum discussions but were either branded as experts (of whom Gove had had enough) or part of project fear.

 

The government could still have retrieved the mess we are in but decided to not partake of membership of the single market (available through the EEA).  There are good reasons why they made that decision but what we see now are the consequences. 

 

There is no malice involved on the part of the EU.  It is the simple rules of international trade.  And yes import taxes/local sales taxes (aka VAT)  is a money making exercise - one that is applied around the world.

 

We have been protected from much of this  through UK membership of the EU but no more.

 

Regarding my own experience, I was fully prepared for it and the only bit I did not know in advance was just how much the delivery company charge would be.

[Mikkel]

Just to clarify: The fees I'm getting hit by now here in Denmark aren't directed towards the UK specifically. They are the same for any order from countries outside the EU. It just so happens that the UK are now subject to them.

 

1 hour ago, cbrooks122000 said:

EBay and Amazon do a deal when ordering from the US where you pay the Duty up front so you don't get the nasty Service Charge, so our Retailers should start doing the same or sell through EBay to do it.

 

That sounds like a possible way forward. I wonder if it would be too much work for small traders though?  

[Jonboy]

In the perfect world it would be rolled into the payment gateway (e.g Barclaycard, PayPal, Sagepay etc) as they have the size and well established website connector protocols to roll it out.....but the sheer volume of commodity code and tariff rates makes it a minefield.

[LimboBrit]

1 hour ago, cbrooks122000 said:

It is a bit early but EBay and Amazon do a deal when ordering from the US where you pay the Duty up front so you don't get the nasty Service Charge

What I see happening is that one gets stung twice through eBay’s Global Shipping Program, on shipping and some retailers aren’t geared up to deducting sales tax or VAT for overseas shipment. In many cases, particularly on private sales, it is no longer interesting to buy through eBay

[SM42]

10 minutes ago, Jonboy said:

In the perfect world it would be rolled into the payment gateway (e.g Barclaycard, PayPal, Sagepay etc) as they have the size and well established website connector protocols to roll it out.....but the sheer volume of commodity code and tariff rates makes it a minefield.

 

It really shouldn't be beyond the capablities for a computer program to be able to do all this using the product barcode to identify the product and its origin and link this into the VAT accounting for destination country and produce a custom lable to attach to the consignment.

 

It wouldn't work necessarily  for those smaller companies  who make and sell,  but for the retailers shifting someone elses product it could.

 

Andy

[Andy Hayter]

Bar codes do not contain the Duty tariff codes required for calculating the import duty (as opposed to VAT).  

[Andy Hayter]

4 minutes ago, cbrooks122000 said:

Reading his post again obviously Denmark has a much lower break point for imported goods if the order was for £25.75, if the limit is £39.00 for the UK, then under our rules there should be no charge. Their VAT must be a lot more than ours as well, 20% of £25.75 is not £6.15.

 

You are confusing commercial sales - which are VAT and Duty liable at any level - with a gift which has the £39 limit (IIRC EU = €42 so completely in line with the UK)

[SM42]

17 minutes ago, Andy Hayter said:

Bar codes do not contain the Duty tariff codes required for calculating the import duty (as opposed to VAT).  

 

True, but they could. Just needs a bit of joined up thinking across the globe to make life and international trade easier.  They can identify the item in the supermaqrket, why not the tariff code too?

 

 

8 minutes ago, cbrooks122000 said:

Reading his post again obviously Denmark has a much lower break point for imported goods if the order was for £25.75, if the limit is £39.00 for the UK, then under our rules there should be no charge. Their VAT must be a lot more than ours as well, 20% of £25.75 is not £6.15.

 

This was a commercial transaction, not a gift. 

 

Andy

 

Just seen Andy Hayter's post and he knows more than me about it so I've removed erroneous info

Edited February 4, 2021 by SM42

[SM42]

2 minutes ago, cbrooks122000 said:

The ones in the US do it through EBay, if you buy through their global program you get cheap postage and they sort out the tax etc. As I say, I buy loads of stuff from the US and that is how it works. The UK Supplier should not be charging you VAT, so the advertised price should be 20% cheaper. As I said at the moment it seems to be "open season" for scams, some by reputable organisations. I got charged 20% extra on EBay supposedly for VAT, by EBAY. Firstly it it illegal to do that and when I chatted to them explaining it was a Seller already in the UK, they said it was an error in their program and they didn't know when would be able to send me a refund. It was only I had bought the item and I didn't want a bad Buyer mark that I paid it.

 

 

Not necessarily a scam. More likely complete and utter confusion or more likely just not knowing what to do.

 

The VAT man is one of the people you really don't want to be getting on the wrong side of

 

Andy

[jpendle]

5 minutes ago, cbrooks122000 said:

The UK Supplier should not be charging you VAT, so the advertised price should be 20% cheaper. 

Actually the price without VAT should 16.666% cheaper, or divide the list price by 1.2.

 

Regards,

 

John P

[SM42]

1 minute ago, cbrooks122000 said:

No I am not, I thought the £39.00 was a bit high. When I was buying classic motorcycle parts, I sort of remember £18.00 was the limit but that was about 10 years ago. As most of my purchases lately, are through EBAY.com they handle the Shipping and the upfront Duty. It is also very important that the value on the Customs form is correct, as that is what Customs look at to work out the duty. None of my purchases were gifts, all commercial. In the US I think the limit is $50, which was a pain as a lot of suppliers would just put the value at that even if it was substantially less.

 

 

The small consignment exemption (sub £15) is probably what you are thinking of.

 

It was abolished on 1st jan

 

Andy

[Philou]

..... and don't forget, if you're buying model trains they're classed as toys and don't attract duty (for the moment) - perhaps I should rephrase that: they have a rate of duty of 0% (for the moment).

 

Cheers,

 

Philip

[Allegheny1600]

I must remind everyone again, stick to the facts concerning what we know about the subject matter.

 

Posts that are inflammatory and/or pro or against the current situation will not be tolerated. I will be as fair about this as I can but I simply will not accept any spouting off.

John Edge

[etendam]

11 hours ago, Philou said:

..... and don't forget, if you're buying model trains they're classed as toys and don't attract duty (for the moment) - perhaps I should rephrase that: they have a rate of duty of 0% (for the moment).

 

Cheers,

 

Philip

An overview of the rules after July 1st:

 

The Duty for Modeltrains will not change after July 1st but there is a catch here. They have a duty of 4.7% (Now also!) if they are not made (for at least 50%!) in the UK (but in f.i. China) This is why Hornby is setting up an EU warehouse! So if you sell a drive system with a Chinese motor it will be hit with a tariff. 

 

Beside the 0 or 4.7 % duty you will always (after July 1st) VAT for any purchase after July 1st when an item arrives in the EU and the carrier will also add a bill that differs by country (From € 5 to € 20) for handling the import duties, even if it 0.

 

Commercial sellers will need an EU VAT number and take care of the VAT and a VAT representative in the EU. A workaround for this is by working with dealers in the EU, or appoint an importer, setup a EU warehouse (where the items from China are shipped directly to)  With this system the EU wants to avoid that buyers are self importers and that the trade will go back to traders and that the VAT will go to the country where the goods are delivered to avoid that the VAT stays in the country where the warehouse is.

 

CE Markings are required on items that are classified in the Toy category (and Modeltrains is a part of this!). The exemption is that it is a collector item and only suitable for 14 years and older. Both the collector item and the 14 years rule should be on the package. Without the CE markings the customs will keep shipments until the CE documentation arrives.

 

When selling motors (as motors can also be suitable in not only modeltrains) you should not use the Tariff code for modeltrains but the Tariff code for motors or coreless motors.  They will have a duty of 18% ! (+ VAT + carrier handling fee) but then a CE marking is not needed. The same works for flywheels, gear, electronics used in modeltrains etc. 

 

After July 1st the double VAT is still possible if a commercial seller doesn't want to request a EU VAT number. Then everything is handled by the carrier and the buyer is faced with high additional costs! if a sale is done by Ebay (or any other marketplace that MUST collect the VAT for the EU) and the Ebay invoice is not attached to the shipping documentation where it clearly says that the VAT is paid, then you are also hit with double VAT. VAT on Ebay only applies to commercial sellers, when purchasing from a private seller the VAT will always be added, so sometimes it will be more expensive to purchase from private sellers in stead of buying new items.

 

As a commercial seller you can choose to use a more expensive GSP or additional costs will be charged when the item arrives at the buyer. Be aware that a buyer can leave negative feedback when he is hit with high additional costs that aren't mentioned in the Ad.

 

Ed

[irishmail]

On 03/02/2021 at 19:47, Mikkel said:

Well, I joined the fun today from across the North Sea. I live in Denmark and recently ordered some kits direct from Langley Models worth GBP 25,75. Received notification today that the parcel won't be released until I pay a total import fee of... GBP 25,15 

 

Interestingly - and outrageously - that fee breaks down as follows:  Actual import tax GBP 6,15. Service charge for Danish postal service to handle the import tax: GBP 19,00.

 

It is of course a real luxury of a problem compared to what else is going on in the world. Still, it does look like I need to start looking for non UK suppliers - much to my regret.

 

I did read somewhere not sure if it was on here or a facebook group the model railways were exempt from import and custom duties.  Obviously not!   Be handy if there was a model railway distribution warehouse in the EU,  well that's what the UK ministers seem to be telling firms to do who are having problems sending to the EU.   https://www.bbc.com/news/uk-england-tyne-55858598

[Andy Hayter]

1 hour ago, irishmail said:

I did read somewhere not sure if it was on here or a facebook group the model railways were exempt from import and custom duties.  Obviously not!   Be handy if there was a model railway distribution warehouse in the EU,  well that's what the UK ministers seem to be telling firms to do who are having problems sending to the EU.   https://www.bbc.com/news/uk-england-tyne-55858598

 

This is part of the understanding problem. 

"model railways were exempt from import and custom duties."  This is absolutely correct.  Neither Mikkel nor I have paid any import or customs duties.

 

We have however paid VAT and a handling charge for the organisation collecting the money.

 

[etendam]

2 hours ago, Andy Hayter said:

 

This is part of the understanding problem. 

"model railways were exempt from import and custom duties."  This is absolutely correct.  Neither Mikkel nor I have paid any import or customs duties.

 

We have however paid VAT and a handling charge for the organisation collecting the money.

 

Exactly and cloths, electronics and lots of other stuff all come from the far east and then third country duty is also added! The same is for cars made in the UK. As most car parts are not made in the UK, then a third country duty applies (10 %) on the entire car value. This is why the goverment is saying UK businesses that are exporting to the EU to consider to setup a selling hub in the EU or import a part into the UK and a part in the EU.  In the last 4 months almost 1000 UK firms have made a registration in the Netherlands to avoid current and future issues. Hornby did this as well.

Ed

[SM42]

5 hours ago, etendam said:

Exactly and cloths, electronics and lots of other stuff all come from the far east and then third country duty is also added! The same is for cars made in the UK. As most car parts are not made in the UK, then a third country duty applies (10 %) on the entire car value. This is why the goverment is saying UK businesses that are exporting to the EU to consider to setup a selling hub in the EU or import a part into the UK and a part in the EU.  In the last 4 months almost 1000 UK firms have made a registration in the Netherlands to avoid current and future issues. Hornby did this as well.

Ed

 

I seem to recall there was a lot of discussion about what % of a car could be made outside the EU / UK and still be classed as a domestic product of either customs area and hence have no tariff applied when traded between the EU/UK. IIRC it's about 60%

 

Back to model railways.

 

I have in front of me a loco sold by Piko.

 

On the box sleeve it mentions the above 14 years age limit model for collectors, it has a CE mark and it has Piko's German address and website on the box.  However

 

there is also a lot of I presume Chinese writing i.e pictograms on the box too.  No obvious mention is made of actual country of manufacture

 

Now what would a customs official make of all this if it  wasn't a model train. What will they make of it given that it is?

 

Andy

Edited February 5, 2021 by SM42

[etendam]

17 minutes ago, SM42 said:

 

On the box sleeve it mentions the above 14 years age limit model for collectors, it has a CE mark and it has Piko's German address and website on the box.  However there is also a lot of I presume Chinese writing i.e pictograms on the box too.  No obvious mention is made of actual country of manufacture

 

Now what would a customs official make of all this if it  wasn't a model train. What will they make of it given that it is?

 

Andy

Andy,

To make sure they have a CE Mark AND 14 years age limit model for collectors mentioned. Just to be sure whenever someone tries to bring them in court if something goes wrong. Smart move but the CE is the most significant one.

 

As Piko models are made in China they are hit with duty when they come into the EU. However if this item is in the UK now and you sell it to a buyer in the EU and the customs opens it it will be classified as a third country item.

 

The same counts (and most of you perhaps are not aware of this!) when an item that is made in China, sold from the UK to an EU buyer it will added with third country duty (+VAT + carrier fee). However when it doesn't work and the buyer ships it back then it is hit with VAT when arriving in the UK (+ a carrier fee) The third country fee is 0 for the UK. When the item is repaired and sent back the third country duty (+VAT + carrier fee) is added for the 3th time. There are NO exceptions for guarantee or repairs to  skip the customs and VAT! 

This is one of the most important reasons (According to the guys in Brussels - Don't blame Me! ) why a distributor, importer or a selling hub should be setup within the EU to protect the rights of private buyers. I know that this is killing for all smaller suppliers in the UK that are depnding on Export.

 

Ed

[LimboBrit]

27 minutes ago, SM42 said:

Now what would a customs official make of all this if it  wasn't a model train. What will they make of it given that it is?

Very good question. I imagine that it will depend on whether we’re talking about lorry loads of goods being exported/imported or just a package. I expect customs officers will not be able to spend a great deal of time investigating every parcel otherwise they will need to employ an army of people to avoid things coming to a standstill. 

[LimboBrit]

5 minutes ago, etendam said:

Andy,

To make sure they have a CE Mark AND 14 years age limit model for collectors mentioned. Just to be sure whenever someone tries to bring them in court if something goes wrong. Smart move but the CE is the most significant one.

 

As Piko models are made in China they are hit with duty when they come into the EU. However if this item is in the UK now and you sell it to a buyer in the EU and the customs opens it it will be classified as a third country item.

 

The same counts (and most of you perhaps are not aware of this!) when an item that is made in China, sold from the UK to an EU buyer it will added with third country duty (+VAT + carrier fee). However when it doesn't work and the buyer ships it back then it is hit with VAT when arriving in the UK (+ a carrier fee) The third country fee is 0 for the UK. When the item is repaired and sent back the third country duty (+VAT + carrier fee) is added for the 3th time. There are NO exceptions for guarantee or repairs to  skip the customs and VAT! 

This is one of the most important reasons (According to the guys in Brussels - Don't blame Me! ) why a distributor, importer or a selling hub should be setup within the EU to protect the rights of private buyers. I know that this is killing for all smaller suppliers in the UK that are depnding on Export.

 

Ed

I’m was wondering how this sort of thing was dealt with before the UK joined the Common Market. I suppose the main difference is that at that time the world economy hadn’t really taken off so wasn’t such an issue as it is today. 

[jpendle]

Hi,

 

Is it a CE mark or a China Export mark?

Somewhere in this thread, I think, there were some examples.

 

The CE mark has the letters spaced and the E is shaped like the C, more like the Euro symbol than an E.

 

Regards,

 

John P

[Jonboy]

15 minutes ago, etendam said:

However when it doesn't work and the buyer ships it back then it is hit with VAT when arriving in the UK (+ a carrier fee) The third country fee is 0 for the UK. When the item is repaired and sent back the third country duty (+VAT + carrier fee) is added for the 3th time. There are NO exceptions for guarantee or repairs to  skip the customs and VAT! 

This is one of the most important reasons (According to the guys in Brussels - Don't blame Me! ) why a distributor, importer or a selling hub should be setup within the EU to protect the rights of private buyers. I know that this is killing for all smaller suppliers in the UK that are depnding on Export.

 

Ed

 

Except of course in the Uk you can get import tax relief on items temporarily imported, particularly if they are for repair. They do need to be clearly marked as such on the accompanying paperwork and if an electronic carrier booking there is normally a field to indict this (with our main carrier you chose from Sale, repair or replacement, or gift when making the booking on their online system).

 

You do need to keep very clear records of the consignments coming in and going back out of the uk in case of an inspection.

 

I have also used the same routine for items sent back to Turkish factory’s for repair in the past.

[etendam]

16 minutes ago, Jonboy said:

 

Except of course in the Uk you can get import tax relief on items temporarily imported, particularly if they are for repair. They do need to be clearly marked as such on the accompanying paperwork and if an electronic carrier booking there is normally a field to indict this (with our main carrier you chose from Sale, repair or replacement, or gift when making the booking on their online.

None of the Dutch shippers accept this possibility but perhaps this is possible in a few countries. Catawiki also makes a very clear statement that returned items from outside the EU are double hit with VAT.

 

Ed

[etendam]

30 minutes ago, jpendle said:

Hi,

 

Is it a CE mark or a China Export mark?

Somewhere in this thread, I think, there were some examples.

 

The CE mark has the letters spaced and the E is shaped like the C, more like the Euro symbol than an E.

 

Regards,

 

John P

CE mark of course. Everyone like some chinese factories does can put CE on the label but the customs want to see the paperwork on inspection from a certified (and perhaps expensive) body when a batch is inspected. The next shipments from the same factory will be under i nvestigation as well. (According to a customs official) with the new EU VAT number they will be easier to track for the customs and they know upfront which shipments shoul be inspected as they don't inspect every shipment.

 

They work with a hit and follow system.  Once inspected and something isn't right you know the next shipments are high risk and will be inspected. 

 

Ed