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UK & EU VAT clarification


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I am getting more questions on how I am going to handle UK and EU VAT regulation changes.

 

I already applied for an HMRC VAT number and I do not plan to cease shipping to the UK, or the EU.  My UK friends/customers are important to me and I will conform to the laws and regulations of the country. I plan to do the same for EU when the new laws go into effect in July.

 

However, you will have to pay the VAT on arrival for any order that I am shipping to the UK in the next 10 days or so.  Sorry for the inconvenience - there are close to 100 orders in this condition and I will send them an email to inform them of the situation. 

Edited by KursadA
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  • 3 weeks later...

This is great - Her Majesty's Revenue & Customs (HMRC) rejected my VAT number application as incomplete. I had every intention to obey any reasonable rule and do things the right way. But apparently they need not only my driver's license, but also bank account information, mortgage statement (as a secondary proof of ID) etc. 

 

I am not going to give any of this to a country that I am not a citizen of. No wonder many smaller businesses basically just stopped selling to the UK.

 

Did you guys really vote for this??  At this point I am not sure how to handle this - I may be forced to simply stop selling to the UK and redirect everyone to Hannants.   

Edited by KursadA
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~15 years ago I worked on a program to manage border control in/out of the UK.  The government requirements for personal information on each and every passenger on each and every trip led to the airlines throwing up their hands and telling the UK govt they would rather cease service to/from the UK rather than take on the enormous data collection task.  The UK eventually canceled the entire program after spending literally billions.

 

I once got the stink-eye from management when I asked them "why would anyone hire a Texas based company to design and implement a border control program???"  :rofl::rofl::rofl:

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10 hours ago, KursadA said:

This is great - Her Majesty's Revenue & Customs (HMRC) rejected my VAT number application as incomplete. I had every intention to obey any reasonable rule and do things the right way. But apparently they need not only my driver's license, but also bank account information, mortgage statement (as a secondary proof of ID) etc. 

 

I am not going to give any of this to a country that I am not a citizen of. No wonder many smaller businesses basically just stopped selling to the UK.

 

Did you guys really vote for this??  At this point I am not sure how to handle this - I may be forced to simply stop selling to the UK and redirect everyone to Hannants.   

That’s insane they want that info from a non citizen. I was recently shopping some mom and pop train stores online, and noticed a few had notices they will no longer be shipping to the UK due to the VAT requirements. 

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10 hours ago, KursadA said:

This is great - Her Majesty's Revenue & Customs (HMRC) rejected my VAT number application as incomplete. I had every intention to obey any reasonable rule and do things the right way. But apparently they need not only my driver's license, but also bank account information, mortgage statement (as a secondary proof of ID) etc. 

 

I am not going to give any of this to a country that I am not a citizen of. No wonder many smaller businesses basically just stopped selling to the UK.

 

Did you guys really vote for this??  At this point I am not sure how to handle this - I may be forced to simply stop selling to the UK and redirect everyone to Hannants.   

No we did not vote for this, but from what I gather (and it may not be correct) the EU is going to be doing something similar later in the year. The UK government is supposedly getting ahead of the game. It would be a pity if you cannot sell direct to UK people as I would prefer to give you the full amount for every decal sheet that I buy from you, so that it is invested in more decal sheets for me to buy.

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22 minutes ago, Jabba29 said:

No we did not vote for this, but from what I gather (and it may not be correct) the EU is going to be doing something similar later in the year. The UK government is supposedly getting ahead of the game. It would be a pity if you cannot sell direct to UK people as I would prefer to give you the full amount for every decal sheet that I buy from you, so that it is invested in more decal sheets for me to buy.

 

I don't want to have to do this either - not only because I really like the country and its people (I was in London for my last vacation before the pandemic), but also because I was able to reach here thanks to the support of hundreds of UK modelers like yourself over the years - ever since my very first sale as a  business went on its way to Glasgow.  I will try my chances with the UK bureaucracy, there has to be a reasonable way of doing this right.

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38 minutes ago, KursadA said:

 

I don't want to have to do this either - not only because I really like the country and its people (I was in London for my last vacation before the pandemic), but also because I was able to reach here thanks to the support of hundreds of UK modelers like yourself over the years - ever since my very first sale as a  business went on its way to Glasgow.  I will try my chances with the UK bureaucracy, there has to be a reasonable way of doing this right.

It's frustrating for us too especially if you didn't vote for it but I can just say that your efforts are appreciated. 

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Playing devil's advocate for moment, wasn't VAT due all this time even before BREXIT?  It just wasn't collected by the overseas seller.  I can remember placing my first Hannant's order 20 years ago and seeing the VAT tacked on before I created my account with my USA address.  It was a bit of a sticker shock since the rate was so high.

 

My state of residence in the USA forces domestic online retailers to collect sales tax if they meet a minimum amount of annual business in the state.  Several other states do the same thing.  The funny part is you were always supposed to pay that sales tax, but no one ever did.  And flipping eBay collects sales tax on ALL my purchases, even if they are from overseas sellers.

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As I mentioned in a similar thread (under Zactomodels), the new system has nothing to do with Brexit as some seem to think, other than having been introduced here on the same date that the UK/EU transition period ended...

....the new process is mainly because of the sheer volume of goods being imported on which no VAT was being paid, through the likes of eBay, Ali Express, etc, etc. With it being so easy to order online and buy direct from all over the world, the days of bulk importers paying the customs duty are long gone -  governments have woken up to the fact that they have to recover that lost revenue somehow, and are putting the onus on businesses to do it for them...

....unfortunately, the associated bureaucracy is simply causing many to say 'Sod it', and simply stop selling to us in the UK - and doubtless to the EU when they bring in a similar scheme in six months time...

 

But as someone observed in a BBC News article, it's unclear how anyone selling something to someone in the UK could be forced to register with HMRC for VAT - "And if they send the package anyway, what are you going to do?"

Edited by andyf117
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2 hours ago, andyf117 said:

But as someone observed in a BBC News article, it's unclear how anyone selling something to someone in the UK could be forced to register with HMRC for VAT - "And if they send the package anyway, what are you going to do?"

 

Even this "solution" (sending it anyway) is not possible now, because the shipping provider I use to print the postage labels will not let me print a shipping label to UK without a VAT number on the customs form. The only way around this seems to be declaring the item to be "gift" - not exactly legitimate. My concern is not that the SAS will raid my house here in Texas but rather the UK customer will be inconvenienced to be forced to pay the tax on delivery. 

Edited by KursadA
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On 2/4/2021 at 2:19 AM, KursadA said:

 

My concern is not that the SAS will raid my house here in Texas but rather the UK customer will be inconvenienced to be forced to pay the tax on delivery. 

Just to make matters worse this UK customer would be happy (ish) to pay the 20% tax on delivery however the Royal Mail also charge an £8 'handling fee' for their trouble and that ramps up the cost even further. I hope you do keep your tie-in with Hannants, it just means we have to wait longer to get our hands on the latest releases. I purchase decals from three excellent US based artists and sadly one has said that he can no longer sell to customers in the UK 😩

 

Michael 

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As mentioned in my post in the other thread, I forsee some of us going back to the old days, when if we wanted something 'from abroad', we'd ask family or friends there to get and send it to us...

....I'm fortunate in knowing a retired USAF Major in Florida who'll happily forward stuff on to me - back in the days when he was stationed this side of the pond, he was known to exit a BX or two with armfuls of AMT C-135s and jars of Testors paint, most of which I still have!

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I wanted your new F-117A sheet in 1/72 and l cannot buy it from you or Hannants (sold out) in the UK.

 

I will have to wait for it to be restocked, hopefully.

 

It is a very crazy situation we have here.

 

Regards

Robert

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8 hours ago, scotthldr said:

This whole crazy saga has set our hobby back 25yrs in the UK, struggling to get any kind of supplies shipped here now, whether from the US, Japan or Europe.

Agreed.

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Depending how bad you want things. You can try a mail forwarding service, it's not free but you can have a US Address. When I was an expat I used this and bought everything online including ebay. Then once a month have them forward everything to me overseas.

 

Even better if you can find one in a state without sales tax.

 

 

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On 2/8/2021 at 2:56 AM, scotthldr said:

This whole crazy saga has set our hobby back 25yrs in the UK, struggling to get any kind of supplies shipped here now, whether from the US, Japan or Europe.

 

Just out of interest, what are you struggling to source?

 

Jon

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On 2/6/2021 at 7:38 PM, Tomcat Trebor said:

I wanted your new F-117A sheet in 1/72 and l cannot buy it from you or Hannants (sold out) in the UK.

 

I will have to wait for it to be restocked, hopefully.

 

It is a very crazy situation we have here.

 

Regards

Robert

Technically not sold out - has not arrived, found in the future releases section!!!!

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On 2/3/2021 at 8:35 AM, KursadA said:

This is great - Her Majesty's Revenue & Customs (HMRC) rejected my VAT number application as incomplete. I had every intention to obey any reasonable rule and do things the right way. But apparently they need not only my driver's license, but also bank account information, mortgage statement (as a secondary proof of ID) etc. 

 

I am not going to give any of this to a country that I am not a citizen of. No wonder many smaller businesses basically just stopped selling to the UK.

 

Did you guys really vote for this??  At this point I am not sure how to handle this - I may be forced to simply stop selling to the UK and redirect everyone to Hannants.   

No we didnt vote for the change in the way VAT is charged, that was an EU idea. As you said the rest of the EU will follow suit later on this year.

 

Proof of who you are and that you are not going to disappear with HMRC money is always going to be drawn out.

 

The whole thing is a complete and utter debacle, the Brussels have made it so things like the change in the way VAT is charged is part and parcel of Brexit, but its not. It just happens to be happening at the same time. You would have had this problem regardless of Brexit.

 

The UK government decided to charge VAT at the point of sale rather than import so as to be able to catch more of the sales taxes because sellers will send them the tax defacto (as they usually operate within the law, or face penalties) rather than the buyer simply waiting to get caught.

 

The EU have made Brexit really really gritty with rule changes like this, so now when other countries look on and thing twice about leaving because they might have some of the same problems. Thats all its all about.

 

HMRC just want some reassurance that you wont do a "missing trader fraud" with their money. 

Edited by ElectroSoldier
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Kursad, are you required to track, charge, collect and pay state sales tax on US orders outside your home state? 

 

(just asking if you are "required to"... :coolio: )

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4 hours ago, habu2 said:

Kursad, are you required to track, charge, collect and pay state sales tax on US orders outside your home state? 

 

(just asking if you are "required to"... :coolio: )

 

Yes, I am required to do it for many states - the accounting software makes it easy to keep track of this. But having to register for taxes with another country is at a completely different level..

 

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  • 2 weeks later...

Despite the apparent EU bashing from some quarters in this thread, Kursad you should kwnow that if you do decide to go with registering for the EU you'll only need to register in one country. 

However,  my info at the moment is it will be optional,  you can continue to trade as before and I'll pay the charges when I collect the package.

https://www.revenue.ie/en/tax-professionals/tdm/value-added-tax/part10-special-schemes/vat-ecommerce-rules-1-july-2021/vat-ecommerce-rules-1-july-2021.pdf

 

I do take exception to the inference further up that the EU is somehow responsible for doing this to UK in order to "punish" them and make brexit difficult. UK tax laws are set in UK. Brexit and any consequences of it are the responsibility of one country only. The one that left.

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  • 4 weeks later...

Sorry, nothing new yet. If it happens I will post it in this thread literally at that minute; but honestly I don't expect a quick resolution. 

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