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UK news Changes to VAT treatment of overseas goods sold to customers from 1 January 2021


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#1 OFFLINE   speedy

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Posted 22 October 2020 - 12:07 PM

https://www.gov.uk/g...-1-january-2021

This isn't going to be good for the collectors in the UK by the sounds of it.

Star Trek star William Shatner has threatened to stop selling merchandise from his online store to the UK because of costly red tape.

The Canadian actor, best known for playing Captain James T Kirk in the blockbusting sci-fi franchise, issued the warning on Twitter and apologised to fans.

He claimed the British government was seeking to make overseas sellers collect VAT on orders being sent to the UK from the New Year.

https://news.sky.com...d-tape-12105849

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#2 OFFLINE   slartibartfast229

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Posted 22 October 2020 - 12:50 PM

I can't see how the legalities of this can work.
Companies outside the UK are in another jurisdiction, and unless the government of the second country agrees to such rules, there are no legal powers of enforcement.
Some years ago I got a parking ticket in Newry town, across the border in Northern Ireland.
When I looked closely, it had no registration number on it, meaning the issuer knew well it could not be enforced.
It added a tiny amount to the local litter bin......

#3 OFFLINE   drivinghermad

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Posted 22 October 2020 - 12:51 PM

So basically in the UK tough times are going to be even tougher for buying what we love. :thumpdown: :dizzy: :hellno:

#4 OFFLINE   Baron von Zach

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Posted 23 October 2020 - 05:28 AM

It will be good times in the UK, because we don't spend any money abroad.
Because I'm the Baron. That's why.

#5 OFFLINE   forza!

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Posted 23 October 2020 - 06:11 AM

I'm not really sure what mr Shatner is on about. The new rules are primarily aimed at EU businesses.
For 3rd countries (ie Canada) it was already common practice to register in a destination country if they would want to perform services or deliver goods there.
Sure I'm not an expert but it seems to me that he should do some more investigation on the subject.
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#6 OFFLINE   GroupG

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Posted 23 October 2020 - 07:45 PM

This is exactly how Australia does it with our version of VAT (Goods Service Tax - GST). The Australian government put this in place about 2 years ago. There are still some smaller overseas companies that are not doing it but the larger ones have been. Evilbay included. Who cares about what Shatner does, he does not sell model cars.

#7 OFFLINE   jazzy426

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Posted 24 October 2020 - 02:34 AM

yea sounds like what Oz is doing now... basically a "cheap" implementation by the govt to impose 10% GST on all overseas purchase since they are forcing the overseas sellers to collect the $ on their behalf without needing to get customs and borders involved. Big ecommerce platforms like Amazon, Alibaba, eBay etc all complied and automatically charge 10% for all goods outside of Australia at checkout. I do think this started by some [email protected] hypocrite businessmen that have been lobbying the govt to impose personal import tax with the excuse to "level" the playing field.

#8 OFFLINE   ROBSMC

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Posted 25 October 2020 - 05:24 AM

Yes Jazzy, you are right, it was Jerry Harvey (of Harvey Norman) that was the main influencer of the decision by the Australian government to implement this new tax collection from eBay as he felt that his company was losing money to OS purchases.

A few other companies collect the GST tax on behalf of the government, and some will know that one company in Italy that does this also is MR Collection models. Buy from their site and the 10% GST is added in checkout.

Thankfully BBR does not do this yet, so no extra tax when I buy their models. Hopefully they don't as this will keep pushing prices up.

#9 OFFLINE   Baron von Zach

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Posted 25 October 2020 - 12:24 PM

So the UK is now carefully cloning every Australian misconcept?

God help us...
Because I'm the Baron. That's why.

#10 OFFLINE   jazzy426

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Posted 25 October 2020 - 09:39 PM

Yes Jerry Harvey is such a hypocrite. When the sale volume at Harvey Norman slumped he was quick to blame e-commerce for affecting his brick and mortar stores and he blamed Aussies for buying stuff from overseas and essentially he was asking govt to punish the buyers by slapping import tax on all purchase. Govt knocked back his proporsal initially because they reckon it would cost more to implement it than the amount of tax they could collect so what he did next was create an entity called Harvey Norman direct import in Ireland which sells UK/EU sourced games and movies to Australians.

To be frank majority of the overseas purchases by most are just blurays, console games etc which doesn't really hurt HN's core business interest since they trade primarily in bulky white goods and premium furniture anyway. It is not like Aussies are importing wide screen TVs and fridges from overseas just because they are slightly cheaper elsewhere.

#11 OFFLINE   slartibartfast229

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Posted 26 October 2020 - 07:38 AM

View Postjazzy426, on 25 October 2020 - 09:39 PM, said:

Yes Jerry Harvey is such a hypocrite. When the sale volume at Harvey Norman slumped he was quick to blame e-commerce for affecting his brick and mortar stores and he blamed Aussies for buying stuff from overseas and essentially he was asking govt to punish the buyers by slapping import tax on all purchase. Govt knocked back his proporsal initially because they reckon it would cost more to implement it than the amount of tax they could collect so what he did next was create an entity called Harvey Norman direct import in Ireland which sells UK/EU sourced games and movies to Australians.

To be frank majority of the overseas purchases by most are just blurays, console games etc which doesn't really hurt HN's core business interest since they trade primarily in bulky white goods and premium furniture anyway. It is not like Aussies are importing wide screen TVs and fridges from overseas just because they are slightly cheaper elsewhere.
With people such as this, it's the idea that customers should have a choice where, and how they spend their money.
This was the idea of the new Irish state after independence in 1922.
Promote 'self sufficiency' through punishing import taxes on goods not manufactured in Ireland.
Of course the same governments who supported the idea didn't actually live by these rules, introducing a variety of loop holes for those with the right connections.
It took until the 1990's for Ireland's economy to wake from the slumber, and cast off the restrictions which stifled our lives.
This Tory scheme stinks of the same idealogical imposition.

#12 OFFLINE   spikyone

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Posted 26 October 2020 - 08:05 AM

View Postspeedy, on 22 October 2020 - 12:07 PM, said:

https://www.gov.uk/g...-1-january-2021

This isn't going to be good for the collectors in the UK by the sounds of it.

Star Trek star William Shatner has threatened to stop selling merchandise from his online store to the UK because of costly red tape.

The Canadian actor, best known for playing Captain James T Kirk in the blockbusting sci-fi franchise, issued the warning on Twitter and apologised to fans.

He claimed the British government was seeking to make overseas sellers collect VAT on orders being sent to the UK from the New Year.

https://news.sky.com...d-tape-12105849

Sounds like it will be much better for UK consumers.  No more buying stuff from overseas and not knowing how much you'll pay in VAT/duty when it arrives, and hopefully no more post office/Fedex fees.  Seems like a win to me.  The only downside is if sellers don't want to play ball and refuse to ship to the UK, unless I've missed something.

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#13 OFFLINE   EmilA

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Posted 26 October 2020 - 08:08 AM

There I was hoping things would improve for us all, fun :(

#14 OFFLINE   Baron von Zach

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Posted 26 October 2020 - 02:05 PM

View PostEmilA, on 26 October 2020 - 08:08 AM, said:

There I was hoping things would improve for us all, fun :(

Wrong century, m8.
Because I'm the Baron. That's why.

#15 OFFLINE   Hybrid Theory

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Posted 01 January 2021 - 06:37 AM

On my eBay all items from Europe are now showing up +20% vat will apply

I thought after a deal was agreed there would be no import duties for buying from Europe, has something changed?

#16 OFFLINE   vulpex

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Posted 01 January 2021 - 06:49 AM

At the moment everything seems to be undefined. :gaah:
Personally I will follow the „wait & see“ approach - i.e. neither buying nor selling from / to the UK until the fog has cleared...

#17 OFFLINE   snowman

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Posted 01 January 2021 - 06:55 AM

View PostHybrid Theory, on 01 January 2021 - 06:37 AM, said:

On my eBay all items from Europe are now showing up +20% vat will apply

I thought after a deal was agreed there would be no import duties for buying from Europe, has something changed?

Like most people who voted for Brexit (no idea if YOU did or not), you misunderstood!

You won't pay EU VAT anymore (or you shouldn't), but you'll still pay UK VAT, which is 1% more than German.

There are no DUTIES on the import, the 20% is ALL UK VAT as if you were buying from a retailer in the UK.

Retailers in EU countries, though, should remove their domestic Sales Tax as we're no longer in a reciprocal agreement.

Buying from the EU now will be like buying from the US, China or Japan.

View Postspikyone, on 26 October 2020 - 08:05 AM, said:

Sounds like it will be much better for UK consumers.  No more buying stuff from overseas and not knowing how much you'll pay in VAT/duty when it arrives, and hopefully no more post office/Fedex fees.  Seems like a win to me.  The only downside is if sellers don't want to play ball and refuse to ship to the UK, unless I've missed something.

There was no reason for not knowing how much VAT you would pay it's always 20% (if you didn't get charged, you got lucky!).

It will be interesting to see if the PO and Fedex now drop their charges. I suspect they'll actually go UP as they'll be checking to see if the VAT WAS paid in advance...

I suspect this will be final nail in my diecast collecting as most have come from Germany and, at the moment at least, the retailers seem to be struggling - I guess it's only day 1, so let's see how it pans out.

M

Edited by snowman, 01 January 2021 - 07:03 AM.


#18 OFFLINE   slartibartfast229

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Posted 01 January 2021 - 07:27 AM

EU retailers may drop the VAT on items they sell, although they may also claim additional costs for paperwork, customs decelerations etc.
Buyers already outside the EU will have stories to tell on this issue.
E-bay sellers - if they are private individuals - will probably not have this option.
If buying from such a seller in the EU you might find a demand for the additional 20%.
You have to be registered for VAT and have a VAT number (so that when the taxman calls you can explain).
This should always have been the case with second hand goods (used) because VAT had already been paid (an EU rule as far as I know).

Edited by slartibartfast229, 01 January 2021 - 07:28 AM.


#19 OFFLINE   Hybrid Theory

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Posted 01 January 2021 - 07:38 AM

Just been on ck-model cars and model prices are still the same, except you now need a minimum order of £135 (155 euro’s) and delivery has doubled to 19.95 euro’s.

Im guessing you will have another 20% VAT on top of that so really looking bleak for UK collectors.

#20 OFFLINE   Uzair

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Posted 01 January 2021 - 07:46 AM

Here's the bottom-line as I understand it: with the last-minute agreement import duties will not be present, however VAT certainly will be.

For buyers in UK from EU, and vice-versa, this will not, or should not in theory, change things drastically when buying from business sellers. However, it does change the game totally when it comes to private sales. Reason: private sellers will not be able to get any VAT removal on the item they are selling.

So let's say as a UK buyer you buy a model from CK-modelcars with European retail price of €100. CK will remove the German VAT when they sell to you since the item goes outside the EU. So you actually pay €84. When it enters the UK and before you can claim it you will have to pay UK VAT and any import processing customs fees. If UK VAT is 20% that means about €85 plus fees. Therefore, not a huge difference. However, if you want to buy a model from me (a private seller based in Denmark, part of the EU), I can not claim the VAT deduction with the Danish government. The model I am selling I have already paid full price whenever I bought it. So if I am selling a model for let's say €100, any buyer in the EU will have no additional fees since - again - there are no customs charges within EU. A UK buyer on the other hand will have to pay €100 + (let's say 20% VAT) €20 + any other processing fees.

And the same goes for me trying to buy items from private sellers in the UK. Actually Danish VAT is the highest, at 25% more than British VAT, so even from business sellers i will think twice before buying. And buying from private sellers in the UK? Forget about it!

The upshot of all this: I doubt I will be selling models to UK based buyers anymore. That's ok for me since the European market is large and yes while I lose a few potential customers I still have many countries in EU where people can buy models from me. UK private sellers, as far as I understand, are out of luck. Their market will be drastically reduced.

While Brexit is a matter of internal UK politics (in my opinion, matters of enormously important and complex state policy which few people still understand properly should be decided by experts, not be a referendum, and certainly not where one side was lying through its teeth and manipulating the masses the whole time and to this very day (the £350 million a week bus, Boris?)),  there is a very real impact here on our hobby. and many other areas of commerce and where people would be buying and selling stuff privately across borders.

Not a good outcome at all.

Edited by Uzair, 01 January 2021 - 08:21 AM.

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#21 OFFLINE   snowman

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Posted 01 January 2021 - 08:33 AM

OK, let's take an example of CK-Modelcars

The Kyosho Lancia 037 is shown as 179.95 Euros

Add it to your basket and go to checkout with a UK address

You will see the price is now 151.22 Euros

This is the net price (ex 19% German VAT)

If you buy you will pay 171.17 Euros (with 19.95 Euro postage - No idea why that's skyrocketed!) BUT you are liable for 20% on top of that, so you SHOULD end up paying 205 Euros plus whatever you get charged by the shipper for administering the VAT charges on importation to the UK (probably around £15 - Although they may have hiked that TOO or it may account for the increment in the postage cost, being factored in - well, we can dream!  :rolleyes: )

EXCEPT, there's an odd rule I don't understand about a £135/155 Euro minimum of goods - So you can't buy the Kyosho Lancia 037 alone as it's less than that!

So, just like it used to be when importing from anywhere outside the EU, except we're now even more isolated - Better? Is it F...

M

Edited by snowman, 01 January 2021 - 08:37 AM.


#22 OFFLINE   jusali

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Posted 01 January 2021 - 08:53 AM

Yep it's an utter shitshow for sure.
But come on, it was clear as day this was coming. I think everyone will lose out eventually, I can see CK losing a lot of uk customers, whether that is a big base for them I don't know, but I'm seriously gonna have to reconsider my purchases with them in future. I noticed the hike in postage but didn't clock the minimum order price!

#23 OFFLINE   Uzair

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Posted 01 January 2021 - 08:59 AM

View Postsnowman, on 01 January 2021 - 08:33 AM, said:

So, just like it used to be when importing from anywhere outside the EU, except we're now even more isolated - Better? Is it F...

M

View Postjusali, on 01 January 2021 - 08:53 AM, said:

Yep it's an utter shitshow for sure.
But come on, it was clear as day this was coming. I think everyone will lose out eventually

I knew back in 2016 right after the shock election result (which other 2016 election result shocked us, and who was an architect behind the scenes in both? R. Murdoch) that this would be a slow but definite disaster in the unfolding. I've got a lot of very choice appropriate words to say about the matter and those behind all the deception and political thuggery but since this a hobby forum and not a political one will abstain. But make no mistake, Brexit affects everyone in Europe. Effects on EU citizens? A little bit. Effects on UK citizens? A whole lot, and very little for the better.

Political campaigns based on absolutely cynical sloganeering mixed with a populace too caught up in a simplified worldview and unable to exercise critical thinking gets us to these kinds of things. And here I thought politics in the south-Asian sub-continent (where I grew up) was full of charlatans and gullible citizenry...
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#24 OFFLINE   slartibartfast229

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Posted 01 January 2021 - 09:28 AM

Gullible people exist everywhere.
Religion exists long after it's expiry date because of them.
Fortune tellers, palm readers, purveyors of lucky charms - all (and many others) continue to prey on the foolish.
"There's one born every minute".
A long time ago I learned a valuable lesson - listen once, cross check twice.

#25 OFFLINE   Uzair

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Posted 01 January 2021 - 09:33 AM

Well said Slarti! And I would expect no less from a reader of Douglas Adams.
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