MegaSack DRAW - This year's winner is user - rgwb
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I want to buy a bike part from Australia, its £89.
At first I used the government tariff lookup to get the commodity code and the duty/VAT calculator reckons I will pay £28 (plus £8 handling fee assuming its Royal Mail that processes it) At this point I binned the idea as the postage is also £25 so the cost is eyewatering.
But then I just had another look as I'm sure low value items don't attract duty/VAT, and the Gov website states:
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.
Is this correct...surely any VAT would be the local rate for Australia? The summary at the top of the page appears pretty clear;
You will not have to pay anything to the delivery company to receive goods worth less than £135 unless they’re gifts over £39 or excise goods (for example, alcohol and tobacco).
If this is correct, I guess the duty calculator is ignoring this £135 dispensation, even though I've punched in the price and postage into their respective boxes...
Duty will only be 4% so included or not makes little difference. I theory the Aus company should prepay your UK VAT, but I bet they won't. They can just send it and see what happens this end. I suspect you'll just get the bill.
I just paid 220$ for some bike bits from the states. That was their price less sales tax, plus postage. Bits turned up here a few days later no questions asked. No VAT, no duty, no handling charges. It seems to be pot luck but I don't think there is much appetite (or available staff) post Brexit to go through the paperwork on every little packet coming in from overseas.
Under IOSS, online retailers should be collecting any VAT due in the destination country at the point of sale for shipments up to £135 (they can also collect for higher amounts, but there is no legal requirement for them to do so), however most small retailers simply don't do it, as it's an admin nightmare (or added expense if they use a third party provider).
Instead they will simply slap on a customs sticker/invoice and let the receiving country/delivery company handle it, which will mean you will very likely get an additional handling charge.
Also the £135 figure is related to Import Duty.
Below that Import Duty doesn't get applied, however VAT does, which is the main driver behind IOSS.
spooky_b329
Full Member
I want to buy a bike part from Australia, its £89
Before you disappear down this rabbit hole, have you confirmed the shop will even ship to the UK??
Vlad, yes this is the kicker, there was a small importer and a few uk website reviews but the company ended up setting up a uk website to sell direct. At least its made obvious at checkout unlike some EU companies where you only realise when you get courier tracking updates from Spain...
I've been in contact with them and they referred me to some european distributors but they are also all out of stock. They themselves only have a few left at the moment hence not saying what the product is, just yet!
I'll ask them about IOSS and prepaying the VAT, they've been pretty helpful so far
So how does this work?
This explicitly states that I would not pay duty, VAT or handling for goods under £135.
https://www.gov.uk/goods-sent-from-abroad/tax-and-duty
The seller checkout states:
Note: Prices on this stock have been reduced and exclude VAT to allow for the relavant UK taxes and duties.
So, if I end up paying nearly £30 in additional charges, can I then reclaim it based on the .gov advice, or will it simply come down to he didn't pay, it so I have to?!
That page is assuming the goods are being sent under IOSS, which they legally should be, but see my previous post.