Reply With QuoteYou will have to pay 20% VAT yes. Plus whatever handling fee the courier levies
Sent from my SM-G950F using Tapatalk
Ive tried to research this but can’t seem to find a definitive answer, does anyone know for sure.
Am discussing a watch from a private seller in the EU via Chrono24, most dealers will give you a price
less VAT but a private seller can’t do that but does anyone know for sure if I will have to pay 20% VAT when it arrives in UK.
You will have to pay 20% VAT yes. Plus whatever handling fee the courier levies
Sent from my SM-G950F using Tapatalk
Depends if the seller declares the full value or not. If they don't, the package won't be insured, so I would assume they would want to declare full value.
I think they can also mark it as a gift rather than goods, but not sure how insurance works with that.
Better to be safe and accept one of the many benefits of Brexit, by adding 20% to your purchase price.
It is likely that your seller will have already paid VAT in the country of purchase and you will pay it again when it lands here. You could always try and claim it back if your seller has an invoice showing that it was paid - but good luck with that one.
Different if buying off a dealer, they can sell as an export and remove the VAT so that you only pay it here.
Unfortunately 20% VAT, handling charge and postage puts it very close to the price of a new one here and above my budget.
The issue is that the sale is through Chrono24, which is an Online Market Place, so counts as a business sale even for private sellers.
I believe that a truly private sale eg between acquaintances, is exempt.
‘Non-business sales
Sales made by persons who are not in business are outside the scope of these measures. This includes gifts and consignments sent from consumer to consumer. Guidance on whether an activity is a business activity or not for VAT purposes can be found in the Non-business manual’
https://www.gov.uk/government/public...-point-of-sale
Developed a little further:
VBNB28000 - VAT Business and Non-Business activities: disposal of private assets - which this watch is I assume?
The disposal of private assets is a non-business activity. If, however, the
goods are sold through a business you will need to look at the circumstances carefully before deciding whether the sale can properly be regarded as being separate from the business. This is demonstrated in Mittu (JS) (VBNB72800).
When considering if a sale is indeed private you should consider the nature of the transaction carefully, in particular:
- are the goods sold of a type normally sold through the business? Yes, normal C24 business.
- was the sale dependent upon the contacts and reputation of the business? Yes.
Therefore the sale is classed as a business to customer (B2C) transaction and liable for VAT.
Originally Posted by alfat33
Thanks for the input everyone, think it’s probably best to look for another one.
so - does this mean if you were to buy a watch (goods) from an individual on a private basis in the EU and import to the UK you can rightfully claim back any VAT paid on import? That is very interesting if so.
“ Ford... you're turning into a penguin. Stop it.” HHGTTG
I think in theory that's correct however I can't imagine it being an easy process. The obvious solution would be for the Customs Declaration to ask whether it's a business or personal transaction however that would be an easy fraud route for businesses to mis-declare and therefore inappropriate as a solution.
Actually this is going to be such a common question on here I'll give our VAT Policy people a call next week to get the definitive position and relay it here.
many thanks! I did also read this section
VBNB27000 - VAT Business and Non-Business activities: hobbies
People sometimes have hobbies that involve the making of taxable supplies, for example repairing cars or selling stamps. These supplies are not automatically made in the course or furtherance of business. You should apply the business test.
It is unlikely that hobbies which involve a registered person making minimal supplies are business. However, in some cases the person’s hobby can lead them to make substantial supplies and may grow to become a business activity. Many successful businesses grow out of a hobby or private interest.
When judging whether a hobby should be seen as a business activity you should consider whether the activity is taxable for income tax purposes. The Income Tax (Trading and Other Income) Act 2005, Part 2, Chapter 2, Section 5 states that:
Income tax is charged on the profits of a trade, profession or vocation.
This is a similar provision to the VAT definition of business in VAT Act 1994 Section 94(1) which includes “any trade, profession or vocation”.
VIT VAT Input Tax VIT44000 gives guidance on situations where people feel that tax paid on the costs of their hobbies may have been incurred to promote or advertise their business.
“ Ford... you're turning into a penguin. Stop it.” HHGTTG
Private sales aren't exempt from VAT on import. The difference is how it is collected.
The 'measures' mentioned is the scheme to collect VAT at POS.
Brexit. The gift that keeps on taking.
F.T.F.A.
I am trying to understand how it ever worked.
I spend all day every day trying to unravel the Withdrawal Agreement and Northern Ireland Protocol to give UK / NI traders the best opportunity to continue to trade effectively within the new parameters. It's absolutely exhausting.
Ok thanks, that makes sense. I guess it stops dealers pretending they are individuals and avoiding VAT.
Posting Permissions
