Buying and Selling models to/from Europe

[Colin_McLeod]

17 minutes ago, SM42 said:

Ok

 

As an example, using simple if a little unlikely numbers,  if someone could answer this, so I might get my head round it

 

If I buy a product from the EU and the total cost is €195, my credit card rate is £1 = €1.50. 

The sterling cost is £130

HMRC have set their rate at £1=€1.20 ( not that I know this at the time)

The sterling cost is now £162.50

 

Now as far as I'm concerned I am below the £135 limit. HMRC think otherwise

 

How much would I have to pay extra using HMRC's exchange rate compared to my credit card rate?

 

Andy

 

If you use realistic exchange rates, the issue you have raised is not such a problem.

[Jonboy]

21 minutes ago, SM42 said:

Ok

 

As an example, using simple if a little unlikely numbers,  if someone could answer this, so I might get my head round it

 

If I buy a product from the EU and the total cost is €195, my credit card rate is £1 = €1.50. 

The sterling cost is £130

HMRC have set their rate at £1=€1.20 ( not that I know this at the time)

The sterling cost is now £162.50

 

Now as far as I'm concerned I am below the £135 limit. HMRC think otherwise

 

How much would I have to pay extra using HMRC's exchange rate compared to my credit card rate?

 

Andy

 

the hmrc is always generous compared to real life values at the start of the month. As a comparison at one point a while back the hmrc euro rate was 1.17, the best market rate I could secure for 10,000ish euros was around 1.14 and credit cards were around 1.10 or below...

 

the only time the hmrc policy catches you out is if there are huge swings in the market rates, such as March last year when lockdown was announced and I had a lot of imports in transit.

[njee20]

44 minutes ago, spamcan61 said:

I don't see this as a UK loss as the goods will either be bought in the UK now or not at all. I'm not for one minute suggesting this change is a good idea but that's presumably the logic behind it.

You say that (and I fear you’re right that the populace don’t figure in this - screw ‘em), and without wishing to turn this into a bike forum I read with interest that you cannot currently buy a Brooks saddle, an English brand, made entirely in England, but because they’re send to Italy for onward distribution they’ve stopped selling their own product to the UK. Brilliant. 

Edited January 4, 2021 by njee20

[SM42]

Thanks to those who answered my hypothetical  question  with deliberately extreme exchange rates. 

It makes a bit more sense now. 

It seems the biggest hit will be from handling fees f you can find someone to buy from

 

Andy

[maico]

I do my own VAT returns and one thing I've noticed over the last few years is large internet vendors often have multiple VAT registration numbers in different countries where they have no physical presence.

One of the German orders I placed for a Piko V200 loco came with a valid UK VAT registration number on the invoice. I must admit I can't remember who it was possibly Besserepreise or Conrad.

[maico]

56 minutes ago, njee20 said:

You say that (and I fear you’re right that the populace don’t figure in this - screw ‘em), and without wishing to turn this into a bike forum I read with interest that you cannot currently buy a Brooks saddle, an English brand, made entirely in England, but because they’re send to Italy for onward distribution they’ve stopped selling their own product to the UK. Brilliant. 

 

I don't see why? Trade between two VAT registed companies continues as normal but with changes in how VAT is accounted for.

Reminds me of all the nonsense about people in the UK posting toy train videos on Youtube and being fearful the US authorites would fine them for harvesting the data of minors.

[phil-b259]

3 hours ago, maico said:

 

As part of the single market, I don't see how the Dutch can unilaterally charge import duties without being in breach of EU rules.

 

But the UK is NOT part of the single market any more!

 

Under EU rules ANYTHING imported to the Netherlands from outside the single market (i.e. the UK now Brexit has taken place in full) MUST be treated by them in the same way as anything being imported from Australia, the US, Egypt etc.

 

The exact charges to be levied will depend on the product and the specifics of the post Brexit trade deal now in force - but at a bare minimum it will require the imposition of the Dutch rate of VAT to imports plus a whole load of admin to prove it falls into the zero rated customs tariff bracket.

[SM42]

5 minutes ago, maico said:

 

I don't see why? Trade between two VAT registed companies continues as normal but with changes in how VAT is accounted for.

Reminds me of all the nonsense about people in the UK posting toy train videos on Youtube and being fearful the US authorites would fine them for harvesting the data of minors.

 

But surely the issue is not between VAT registered  companies it is  trade between such companies and an individual. 

I wonder who would be liable if the non UK based retailer, didn't  collect the VAT for the UK government or just kept it for themselves, as hey would be outside uk jurisdiction  or are they?

 

Andy

[maico]

23 minutes ago, phil-b259 said:

 

But the UK is NOT part of the single market any more!

 

Under EU rules ANYTHING imported to the Netherlands from outside the single market (i.e. the UK now Brexit has taken place in full) MUST be treated by them in the same way as anything being imported from Australia, the US, Egypt etc.

 

The exact charges to be levied will depend on the product and the specifics of the post Brexit trade deal now in force - but at a bare minimum it will require the imposition of the Dutch rate of VAT to imports plus a whole load of admin to prove it falls into the zero rated customs tariff bracket.

 

What I said is correct. The Netherlands cannot unilaterally set import duties., it is the competence of the European commission.

Edited January 4, 2021 by maico

[Talltim]

This is has been brought on by Brexit, but relates to all foreign sellers, EU or not. In the model railway world I suspect the big sellers of nasty foreign trains into to UK will get themselves set up  for paying HMRC, (such as Modelbahn-shop Lippe) but we are going to lose access to a lot of the smaller manufacturers and one man bands, not just from the EU but also from the US (my area of annoyance) because the admin will not be worth their while.

[phil-b259]

8 minutes ago, maico said:

 

What I said is correct. The Netherlands cannot unilaterally set import duties., it is the competence of the European commission.

 

You miss the point.

 

Up until the end of December 2020, no charges of ANY kind were applicable to imports from the UK.

 

From the first of January such imports MUST have Dutch VAT added to the cost of the item in addition to any charges specified by the EU / WTO rules, all of which is also likely to mean the imposition of a handling charge by the postal service.

 

The upshot therefore is that a customer within the EU will face extra charges when purchasing items from a UK retailer, just as people in the UK buying from the EU will face increased charges / costs.

[steve1]

Very rarely have I even considered buying anything from EU member countries. From now on I just won't bother.

 

steve

[maico]

27 minutes ago, phil-b259 said:

 

You miss the point.

 

Up until the end of December 2020, no charges of ANY kind were applicable to imports from the UK.

 

From the first of January such imports MUST have Dutch VAT added to the cost of the item in addition to any charges specified by the EU / WTO rules, all of which is also likely to mean the imposition of a handling charge by the postal service.

 

The upshot therefore is that a customer within the EU will face extra charges when purchasing items from a UK retailer, just as people in the UK buying from the EU will face increased charges / costs.

 

Why are you lecturing me on things I didn't say?

I originally answered Limbobrits post which said "As it stands any shipment from the UK with a value higher than 150 Euros is liable to import duty and Dutch VAT"

As I said in a previous post, I'm VAT registered, do my own VAT returns, and trade in Europe I, therefore, do know what's going on!

Edited January 4, 2021 by maico

[AY Mod]

Up until a couple of weeks ago it was no more difficult than ordering from a shop down the road.

[Andy Hayter]

45 minutes ago, maico said:

 

Why are you lecturing me on things I didn't say?

I originally answered Limbobrits post which said "As it stands any shipment from the UK with a value higher than 150 Euros is liable to import duty and Dutch VAT"

As I said in a previous post, I'm VAT registered, do my own VAT returns, and trade in Europe I, therefore, do know what's going on!

So just how does that break EU rules.

Any package coming into the Eu is subject to import duty if its value is above 150€ and will be subject to local VAT.

The only thing that has changed is the the UK now falls into the group of countries that this rule applies to.

[Mel_H]

It is complex. For example a business I am involved with has to be registered with a German VAT number (nothing to do with model railways or selling goods) and it is not possible to claim back the German VAT, so it gets passed to the end customer (despite the items not always being 20% VAT rated, sometimes they are 0%). Many firms in this sector have to use specialist tax accountants.

 

For shipping some goods to the USA it's worse due to its strict product liability rules. This means the UK (for example) manufacturer has to take out expensive insurance in case they get sued. This is a big problem for classic car parts for UK cars, which means if you've got one in the USA life ain't great.

 

And all this was before Brexit. But, generally, buying from Europe was great. Big 'ouch' bills only arrived with 'Yank' stuff.

 

But, many suppliers will now find it just too difficult to sell us trains, and that's that. It will be like living somewhere with 'tricky' postal services, such as some African countries, where shops simply won't supply.

 

Many UK businesses (including Hornby) stopped accepting overseas orders in the run up to 31 December due to the uncertainty. 

 

All in all, it's not great news. It's also a problem for those of us with funny foreign classic cars who can only get parts from the former East Germany.

 

Also of note is that Irish Railway Models online shop now doesn't charge VAT at the checkout. I presume it will be added later...

 

The end of the 16% German VAT rate (for C*V*D) was always due to happen on 31 December, but if you were making large-value purchases it was a good saving.

 

Anyway, for those modelling upside-down-railways, Auscision Models still seems to be supplying to the UK. Phew!  http://www.auscisionmodels.com.au/index.htm

 

 

Edited January 4, 2021 by Mel_H

[Andy Hayter]

11 minutes ago, Mel_H said:

 

 

Many UK businesses (including Hornby) stopped accepting overseas orders in the run up to 31 December due to the uncertainty. 

 

 

 

 

 I would (at this stage at least) separate out such cases.

 

There was a very real issue around 31/12. 

 

Orders shipped before that date were considered under EU rules for VAT.

Orders delivered into the EU after that date were subject to new (for the UK) rules on VAT.

With the many delays in delivery at the end of this year, there was a very real possibility that a company and its customer could fall foul of both sets of rules.

 

At least I hope that interpretation is correct.  

[Mel_H]

2 minutes ago, Willoughby Glen said:

I noticed impact from a number of the model shops I deal with for single items before Christmas with a number stating they will be unable at the moment to deal with sending to the UK.

 

Modellbahn Lippe for instance issued the following advice on Brexit:

 

https://www.modellbahnshop-lippe.com/Events+and+dates/News/Information+about+Brexit+and+delivery+to+UK+%26+Ireland/gb/index.html?id=326

 

Another site I used just dropped delivery to UK full stop and only realised when I got to trying to checkout.

 

In most of the cases the locos I am after have either never made it to the UK or have sold out due to limited numbers and probably the main issue for me, I went AC 3 rail.

 

Hopefully the situation will become clearer to us all soon

 

Perhaps all is not lost. This is on a Dutch eBay seller's site. Sadly, it's not model railways...

 

[Andy Hayter]

11 minutes ago, Mel_H said:

 

Perhaps all is not lost. This is on a Dutch eBay seller's site. Sadly, it's not model railways...

 

Afraid not.  he is simply selling at prices excluding VAT.  Nothing more and nothing less.  VAT is added at the sales point but unless you input an order for delivery to the Uk there is no way to tell if that is a solution or just a way of displaying cheap prices on eBay that are not quite what they seem.

[MikeB]

So now I understand this. If a non-UK based supplier sends goods directly to a customer in Great Britain (I'm not sure if the situation is different in Northern Ireland), the supplier has to be registered for UK VAT and charge UK VAT if the value of the consignment is not over £135. If the value is above this, VAT is charged on import through the shipping company .  So what will suppliers in Germany etc do? One option is not to supply to the UK, or have a minimum order value of £135 for orders to UK.  That will save them the need to register for UK VAT.  What happens if they ignore the demand from a third-party  country (the UK) and just send the goods anyway?  UK law does not extend into the EU or the USA, and will it be worthwhile for HMRC to pursue this, especially smaller suppliers for relatively small sums of money?  Interestingly, there is no minimum for UK VAT registration for non-EU companies, so a single sale would trigger the registration requirement, whereas a UK company only has to register for VAT if the annual turnover is above £85000 - hence many of the smallest suppliers do not have to add VAT.

 

 

 

[ColinK]

I’ve got a small parcel of modelling bits ordered from a small German supplier and paid for. It hasn’t reach me as DHL stopped delivering from Germany to UK and its gone back to the supplier.

 

I’ve also ordered some small components from Shapeways which I think come from the Netherlands. My next project is stuck until they arrive.

 

Frustrating.

[Colin_McLeod]

31 minutes ago, MikeB said:

Interestingly, there is no minimum for UK VAT registration for non-EU companies, so a single sale would trigger the registration requirement

 

Does this apply to private sales

 e.g.  an individual selling a surplus locomotive on e bay?

[CloggyDog]

20 minutes ago, ColinK said:

I’ve got a small parcel of modelling bits ordered from a small German supplier and paid for. It hasn’t reach me as DHL stopped delivering from Germany to UK and its gone back to the supplier.

 

I’ve also ordered some small components from Shapeways which I think come from the Netherlands. My next project is stuck until they arrive.

 

Frustrating.

 

I had a delivery from Shapeways last Tuesday, it was held-up by the border delays in recent weeks, but did eventually arrive.

 

I've enquired of a couple of German and Czech retailers of model trains in recent days, I think the consensus is 'we are waiting for some clarity'  

[Geep7]

Having, in the last 6 months, taken up modelling Spanish railways, and finding that most of the parts that I really need can only be purchased online from EU based shops (Spain and Germany mostly), this is really frustrating. Most of my orders would be for less than the £130 threshold, unless buying a locomotive, so what would happen if an EU based online shop send me an order and didn't collect the VAT? Would my order just be sent back to them, or would I have to pay a charge to the shipping company before they would deliver it?

 

I've ordered from the US before, but i'm pretty sure the rules weren't this complicated. I guess that i'm lucky that the majority of Spanish outline is made by Electrotren, which, now being owned by Hornby, actually distribute their models from Kent, but this doesn't cover some of the smaller manufacturers in Spain, like Mabar.

 

Maybe it's time to set up an importer business, if the market is there, of course?

[creweboy]

So when ebay states 20% VAT is the added on by the seller or by UK customs at point of entry like many items from the US?