Buying and Selling models to/from Europe

[SimonBoulton]

On 06/04/2023 at 21:36, MikeB said:

Good Luck!

As the value of the items are below the threshold, you should get the whole £42 back, if they came from a major shop of through e-Bay, who should have dealt with the UK VAT requirements.  If it's a small shop or private seller and UK VAT has not been paid, there may be issues, but it's not your fault and you should at least get back any excess charges made.  When you say that the shipping label had gone, that sounds strange.  Who removed it - HMRC?  Was there a copy inside the package? .

 

 

In my experience, I don’t know any German retailer who follows the system correctly for orders under £135, they either charge the German VAT or deduct it and send the order VAT free

[irishmail]

21 hours ago, SimonBoulton said:

In my experience, I don’t know any German retailer who follows the system correctly for orders under £135, they either charge the German VAT or deduct it and send the order VAT free

Its very much the same when ordering from the UK!    Only Hatton;s seem to have it set up and are registered for VAT in Ireland and a few other EU countreis.  They give you a few shipping options for under £135/€150 or if over €150 use DHL. 

I think Gaugemaster deduct VAT,  not sure of any others. 

 

[brushman47544]

On 30/11/2023 at 08:04, irishmail said:

Its very much the same when ordering from the UK!    Only Hatton;s seem to have it set up and are registered for VAT in Ireland and a few other EU countreis.  They give you a few shipping options for under £135/€150 or if over €150 use DHL. 

I think Gaugemaster deduct VAT,  not sure of any others. 

 

I’ve used Kernow MRC for shipments to Portugal. They deduct VAT and ship via Royal Mail. There must be some automation because I now get an email from CTT here (Royal Mail’s partner) as soon as the parcel is processed in the Heathrow/Langley overseas shipments centre (or whatever it’s called), so in most cases I can provide the required documentation and pay the import VAT before the parcel arrives, so it doesn’t get held up in a warehouse awaiting processing.

[TTDB]

Hi all, ok I took the plunge and did the experiment I signed up to an account with MyGermany it’s free, I purchased a model bus by a new manufacturer KSW a DB IVECO Crossway from the Weser Ems region, i added the address from my “MyGermany” account as my delivery address and had the model posted there , I then advised MyGermany that I had a shipment en route to my account there, I then a few days later had an email to say the model had arrived so I went and arranged my shipping to the UK on my account very simple, it’s perfect for any items under the threshold or you will end up paying the German Mwst then our wonderful VAT on arrival unless off course the item is such a bargain it doesn’t matter about paying double! I’ve added my address to my eBay account also so if I purchase on eBay.de the items will get posted there  I highly recommend it, 

[irishmail]

Just  had an email from  Hattons about  overseas  orders.  Looks  like  they  may  be  changing  how  they  will ship  overseas  orders  in  the  near  future.  I have  copied  and  pasted  the  email,  expect  all non  uk  customers  will have  had  same.

 

Dear john

At Hattons, we strive to continuously enhance your shopping experience, and we have an important update to share regarding changes to our shopping cart and taxation system.

Within the next couple of weeks, we will implement adjustments to our system to ensure that you are charged the correct tax at the time of purchase. This change is part of our commitment to transparency and compliance with local tax regulations in your region.

As a valued international customer, we want to bring this to your attention to ensure a smooth transition. The good news is that if you despatch the items in your trunk within the next week, you will be exempt from any additional tax costs associated with these changes.

Please note that local customs duties and courier fees may still be charged, we are working on expanding this system to correctly cover landed fees in the future.

We understand the importance of budgeting for your hobby, and we want to make sure you have the opportunity to make the most of this window.

We appreciate your understanding and continued support as we work to improve our services. If you have any questions or concerns regarding these changes, please don't hesitate to reach out to our customer experience team.

Thank you for being a valued member of the Hattons community. We look forward to serving you and providing the best model railway products for your enjoyment.

[brushman47544]

9 hours ago, irishmail said:

Just  had an email from  Hattons about  overseas  orders.  Looks  like  they  may  be  changing  how  they  will ship  overseas  orders  in  the  near  future.  I have  copied  and  pasted  the  email,  expect  all non  uk  customers  will have  had  same.

 

Dear john

At Hattons, we strive to continuously enhance your shopping experience, and we have an important update to share regarding changes to our shopping cart and taxation system.

Within the next couple of weeks, we will implement adjustments to our system to ensure that you are charged the correct tax at the time of purchase. This change is part of our commitment to transparency and compliance with local tax regulations in your region.

As a valued international customer, we want to bring this to your attention to ensure a smooth transition. The good news is that if you despatch the items in your trunk within the next week, you will be exempt from any additional tax costs associated with these changes.

Please note that local customs duties and courier fees may still be charged, we are working on expanding this system to correctly cover landed fees in the future.

We understand the importance of budgeting for your hobby, and we want to make sure you have the opportunity to make the most of this window.

We appreciate your understanding and continued support as we work to improve our services. If you have any questions or concerns regarding these changes, please don't hesitate to reach out to our customer experience team.

Thank you for being a valued member of the Hattons community. We look forward to serving you and providing the best model railway products for your enjoyment.

I’ve had the email. I can only imagine that Hatton’s is either changing the way it handles IOSS purchases (up to €150) or - what I’m hoping - is more countries are DDP. As regards IOSS, here in Portugal our Customs will impose a charge on everything imported irrespective of value unless they get evidence that Portuguese VAT has been paid. If other EU countries are the same, changes to IOSS seems mostly likely.

[irishmail]

10 hours ago, brushman47544 said:

I’ve had the email. I can only imagine that Hatton’s is either changing the way it handles IOSS purchases (up to €150) or - what I’m hoping - is more countries are DDP. As regards IOSS, here in Portugal our Customs will impose a charge on everything imported irrespective of value unless they get evidence that Portuguese VAT has been paid. If other EU countries are the same, changes to IOSS seems mostly likely.

I do hope that is the case and we will get more information from Hatton's once its sorted.  It is not 100% clear in the email if we are going to be liable for any charges/import duties in future, quote from email;  "Please note that local customs duties and courier fees may still be charged, we are working on expanding this system to correctly cover landed fees in the future."

Hopefully they will keep us updated with theese changes.

[fulton]

This is all covered in another thread, "Hattons to charge local taxes..." full explanation there.

[irishmail]

4 hours ago, fulton said:

This is all covered in another thread, "Hattons to charge local taxes..." full explanation there.

This  is  the  topic  for  buying  and  selling  to/ europe, thats why  I  originally  posted  here and  if  you  note  the time  my  post  was  posted  before  the  other  thread  started.  

Also  it  is  in the  model  shop  guide  and  this relevant thread  has been going  much  longer  for  thouse of us who  are affected/ interested  in  this  subject.

[Jason P]

Up until now I have tried to use Hattons as they are VAT registered in EU (I live in Spain) and receiving goods from them was as before Brexit.  Now that Hattons are closing does anyone know of an alternative supplier that is VAT registered in EU? Kernow and Rails of Sheffield both deduct UK VAT before sending.  The problem with that in Spain that as well as paying the VAT owed (I have no problem with this!) I'm also hit with an administration fee by Spanish customs, not to mention the complicated way I have to pay the courier before they'll release the goods.

[Andy Hayter]

Administration fees are standard @Jason P and make buying small value items an expensive affair and Ebay is no better with their global shipping plan.

[Barry Ten]

Just had a very straightforward experience ordering some Viessmann bits from Modelbanhunion in Germany. Reasonable postage, good tracking information and the parcel arrived a day after entering the UK.

[Stefan88]

Postage charges should not count as part of the value of the goods, so if Fedex are doing this then this is incorrect. Ebay do this too (and add on VAT to the postage amount). Whilst this is incorrect you are highly unlikely to get them to change this. I have had a few things sent from Germany and Italy with Fedex and didn't have this problem, this was however in 2022 if I recall, so perhaps they have changed their policy since then. I usually just use DHL from MyGermany which is then delivered by Parcelforce.

 

Re. Hattons, they are the only UK retailer I've heard of to actually bother registering with various EU tax authorities. Perhaps this didn't pan out as well as they thought it would and EU-based buyers just switched to EU-based sellers of British outline models? Modellbahn Union for example stock a lot of Hornby and Bachmann stuff.

 

If you're really lucky there are the odd retailers in the EU who either don't know how to correctly fill in the customs forms or just can't be bothered, and declare the value as €1. Hypothetically if one such trader had a 30% off sale, then minus 19% German VAT, one could end up with some huge bargains  😉

[Andy Hayter]

3 hours ago, Stefan88 said:

Postage charges should not count as part of the value of the goods, so if Fedex are doing this then this is incorrect

 

I am afraid you have this completely wrong so I have corrected it for you.

 

Imports from the EU to the UK:

"Are import costs included in the VAT value?

If a further destination in the UK is known at the time the goods are imported,  costs resulting from the transport of the goods to that place must be included in the import VAT value. These rules also apply to imported goods which are removed from customs or excise warehouses."

 

https://www.gov.uk/guidance/working-out-the-vat-value-using-the-customs-value-of-the-imported-goods

 

 

Imports to the EU from the UK:

"Included in the taxable amount

Taxes, duties, levies and charges, excluding the VAT itself ;

incidental expenses, such as commissions, packing, transport and insurance costs that the supplier recharges to the customer;

subsidies directly linked to the price of the supply."

 

https://taxation-customs.ec.europa.eu/taxable-amount_en

 

In both cases the official documentation is clear that delivery costs/postage is included in the VAT calculation.

 

[Stefan88]

Then why have I not been charged UK VAT and handling fees on everything I have ordered over the last 3 years under the magic £135 (usually just under by anywhere between a few quid to a few pence)? And I'm talking about probably around 100 separate orders if not more. Customs documentation states value, i.e. say €150, and separately states the postage cost, say €15. Every single time adding the postage cost to the order value would have pushed it over the £135 limit. This has almost exclusively been items delivered by Parcelforce, who have always billed me for VAT and handling fee for anything that was over the £135 value. Only once have I had something slip through that was declared at over the £135 value, by Royal Mail a week or so after the rules came in and it had been sent before the year end when the old system still applied.

 

I suspect that guidance is for a business that is importing goods, not an end customer buying goods from abroad. An end customer would not be calculating VAT, they would just be handed a bill for it.

[Stefan88]

Quote

VAT

VAT is charged on all goods (except for gifts worth £39 or less) sent from:

• outside the UK to Great Britain
• outside the UK and the EU to Northern Ireland

VAT is not charged on goods that are gifts worth £39 or less.

You pay VAT when you buy the goods or to the delivery company before you receive them. If you have to pay VAT to the delivery company, it’s charged on the total package value, including:

• the value of the goods
• postage, packaging and insurance
• any duty you owe

VAT is charged at the VAT rate that applies to your goods.

Goods worth £135 or less in total

If you bought the goods yourself and they are not excise goods, the seller will have included VAT in the total you paid.

You will need to pay VAT to the delivery company if the goods are:

• gifts sent to you by someone else and worth more than £39
• excise goods

 

Goods worth more than £135 in total

You will have to pay VAT to the delivery company either before the goods are delivered or when you collect them.

https://www.gov.uk/goods-sent-from-abroad/tax-and-duty

 

So long story short, as experience has shown over the last 3 years, any goods worth £135 or less sail through. The value of the postage is only taken in to account when UK VAT is being charged to the person it is being delivered to, which is only when the goods are worth more than £135.

Edited January 10 by Stefan88

[Andy Hayter]

You have been lucky.  As have I.  I have received goods where no VAT has been charged but should have been. 

 

But the instructions are clear even if they don't seem to be so to you.

 

Under the section VAT - and before we get into GBP135 - so this is a general comment;

 

You pay VAT when you buy the goods or to the delivery company before you receive them. If you have to pay VAT to the delivery company, it’s charged on the total package value, including:

the value of the goods

postage, packaging and insurance

any duty you owe

VAT is charged at the VAT rate that applies to your goods.

[Stefan88]

The £135 rule is central to this topic though.

 

What is clear is that HMRC have taken the position of assuming VAT has already been paid to the retailer at the point of sale for any goods totalling £135 or less. This would then also assume VAT has been paid on the postage cost too, which is not part of the value of the goods. VAT may be chargeable on both but there is differentiation between the value of the goods and the total package value. The value of the goods as far as the £135 rule is concerned does not include the postage cost. A VAT calculation would.

 

In the real world it is as per my previous comment, goods £135 or less sail through with no charges, anything above will be charged at point of delivery. No need to create a debate regarding VAT procedures, this is what happens.

 

On a side note re. VAT on postage, some traders remove VAT from the postage cost as well as on the goods, some don't, and eBay add VAT on even though the listed postage rate will have already included domestic VAT in the cost.

[irishmail]

3 hours ago, Stefan88 said:

Then why have I not been charged UK VAT and handling fees on everything I have ordered over the last 3 years under the magic £135 (usually just under by anywhere between a few quid to a few pence)? And I'm talking about probably around 100 separate orders if not more. Customs documentation states value, i.e. say €150, and separately states the postage cost, say €15. Every single time adding the postage cost to the order value would have pushed it over the £135 limit. This has almost exclusively been items delivered by Parcelforce, who have always billed me for VAT and handling fee for anything that was over the £135 value. Only once have I had something slip through that was declared at over the £135 value, by Royal Mail a week or so after the rules came in and it had been sent before the year end when the old system still applied.

 

I suspect that guidance is for a business that is importing goods, not an end customer buying goods from abroad. An end customer would not be calculating VAT, they would just be handed a bill for it.

Well you have just been very lucky and got away with it. 😁. Nothing gets past Anpost (Irish postal service).

[Stefan88]

The only bit of luck is that HMRC are effectively ignoring anything under £135!

[Ian Morgan]

The EU is currently implementing ICS2. This is supposed to reduce the risk of dangerous items being imported into the EU, and requires more formal documentation and declarations of contents of any items passing into, or through, the EU. By its nature, it will also include information that will be useful for Customs for collecting duties and identifying the origin countries of any component parts of items entering the EU. Phase three of ICS2 comes into force this March.

 

I expect UK HMRC and UKBF will be interested in setting up similar arrangements in the UK in the near future.

 

[maico]

6 hours ago, Andy Hayter said:

You have been lucky.  As have I.  I have received goods where no VAT has been charged but should have been. 

 

But the instructions are clear even if they don't seem to be so to you.

 

Under the section VAT - and before we get into GBP135 - so this is a general comment;

 

You pay VAT when you buy the goods or to the delivery company before you receive them. If you have to pay VAT to the delivery company, it’s charged on the total package value, including:

the value of the goods

postage, packaging and insurance

any duty you owe

VAT is charged at the VAT rate that applies to your goods.

 

It's not luck, Stefan is correct! I have had the same experience.

 

Your quote is for commercial transactions where no vat has been charged at the point of sale.

 

The HMRC site aimed at consumers says:

 

"Goods worth £135 or less in total: If you bought the goods yourself and they are not excise goods, the seller will have included VAT in the total you paid.

You’ll be charged Customs Duty on all goods sent from outside the UK (or the UK and the EU if you’re in Northern Ireland) if they’re either:

excise goods or worth more than £135.

If you’re charged Customs Duty, you’ll need to pay it on both: the price paid for the goods postage, packaging and insurance."

 

In practice HMRC has no sway on German dealers who decide to ship without applying local MwSt.

The value of the goods (using the monthly exchange rate on the HMRC site) is the figure they use.

That may not be the intension but many in the UK use a very imprecise form of English. 

 

(The way HMRC have worded the above statement is somewhat clumsy and probably written by someone who went to a failing comprehensive school...)

 

 

Edited January 11 by maico

[jjb1970]

There are two questions - what is the legal requirement, and is that requirement being properly implemented.

 

The fact that VAT is often not collected on lower value packages does not alter the applicable legal requirements.

[LimboBrit]

15 hours ago, Stefan88 said:

Then why have I not been charged UK VAT and handling fees on everything I have ordered over the last 3 years under the magic £135

In this case I understand that it is the responsibility of the seller to be registered for UK VAT and pay the VAT directly to HMRC. i.e. you should already have paid the VAT to the seller.

Edited January 11 by LimboBrit

[Porfuera]

Just to chip in my 2-pence-worth, I received a parcel from Germany (Modellbahnshop-Lippe) on 27th December and this also didn't have UK VAT added.

 

The ex-VAT price was €154,37 (which the invoice says corresponded to £132.50, although I believe it has been stated earlier in this thread that HMRC use their own rates to calculate the EUR-to-GBP price) - the P&P was €12,90 so that would've easily taken the value to over £135 had it been included in the overall price.

 

That's my second purchase from Modellbahnshop-Lippe, the first earlier in the year also didn't have UK VAT charged but the price of that one came to well under the £135, even including the postage charge.

 

I think I read somewhere (probably here or somewhere else on RMweb) that all incoming goods should technically have UK VAT added, regardless of value, but HMRC don't have the staff available to do it and have set an arbitrary limit of £135 to ease their workload.

 

Edited January 11 by Porfuera