eBay and VAT post-1 Jan. 2021

[M9reno]

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I know there has been some recent discussion in the Forum of the changes to VAT, and its effects on UK-EU trade.  My question is less on the technicality, and more on the application of the law, specifically in respect of items bought on eBay.

Could members please share their experience buying lenses etc. on eBay (from individual or professional sellers) from the EU since 1 Jan. 2021, specifically clarifying whether VAT is actually being applied on arrival of the item in the UK?

I ordered a lens in December from Germany.  Because of shipment stoppages related to Covid, the lens did not ship immediately, and did not arrive in the UK until early January.  It arrived normally (no VAT): did I get lucky?

[pedaes]

13 minutes ago, M9reno said:

: did I get lucky?

Possibly - or could be related to purchase date. Did it come through the eBay shipping programme or did your seller send directly to you?

[Matlock]

I purchased a lens from Austria and VAT was applied on arrival. Another purchase from The Netherlands and VAT was not applied.

[jankap]

Please add the data. Or were the purchases both in 2021 completely.

[Matlock]

4 minutes ago, jankap said:

Please add the data. Or were the purchases both in 2021 completely.

Both purchased this month.

[jankap]

From the send-it click over the bill (date) to the delivery at your address.

OK, perhaps the dutch administration is in disorder, because the government is in trouble. I don´t remember why.

[Matlock]

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30 minutes ago, jankap said:

From the send-it click over the bill (date) to the delivery at your address.

OK, perhaps the dutch administration is in disorder, because the government is in trouble. I don´t remember why.

The lens from Austria was ordered on 13th January, despatched on 14th and delivered on 18th. The Netherlands item was ordered and despatched on 14th January and delivered on 21st. Both by UPS.

[jankap]

I asked, because the bill for the cat on my roof carries a date of December and I received cat and bill in January. The tax in December was 3% lower than in January.

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[M9reno]

2 hours ago, pedaes said:

Possibly - or could be related to purchase date. Did it come through the eBay shipping programme or did your seller send directly to you?

The seller sent the lens directly on Jan. 4, I think through DHL/Parcelforce, and there was nothing on or in the box to suggest the purchase date had been on 21 Dec. 2020. The 20% VAT would have been £240 or so, which I was grateful not to have to pay.

[pedaes]

11 hours ago, M9reno said:

which I was grateful not to have to pay.

Fingers crossed, but my experience from buying in the US has been a bill from the courier turning up a couple of weeks after delivery for the import charge (including on postage) plus an 'admin fee' of ,I think, £25. I would hold the money in a reserve account until mid  February just in case, but as I said fingers crossed!

There may of course have been an unpublished policy of 'do nothing' for a couple of weeks or so grace period, and to cover purchases like yours made prior to 1st Jan, so I would be reasonably optimistic!

Edited January 23, 2021 by pedaes

[pedaes]

The new VAT rules are going to to reflect badly on some items. If it is a VATable item, then it will not be to bad, but for "VAT free' second hand items as sold by ,say, Leicashop Vienna, we will in future have to budget for an extra cost. As the prices are high to start probably will make their stuff a no no!

[M9reno]

10 minutes ago, pedaes said:

Fingers crossed, but my experience from buying in the US has been a bill from the courier turning up a couple of weeks after delivery for the import charge (including on postage) plus an 'admin fee' of ,I think, £25. I would hold the money in a reserve account until mid  February just in case, but as I said fingers crossed!

There may of course have been an unpublished policy of 'do nothing' for a couple of weeks or so grace period, and to cover purchases like yours made prior to 1st Jan, so I would be reasonably optimistic!

Many thanks.  I, too, experienced something similar to your bill when buying something from Japan last year - a letter from FedEx a week or two after delivery, so I paid online.

In this case,I don’t recall there being any declaration of contents or their value on the outside of the box, and there was no sign of the contents being inspected.  So it’s hard to see on the basis of what information taxes or charges would be levied, unless the info was shared by ebay directly... in which case the purchase date would probably result in no charge anyway.

The whole thing is terribly confusing!  And, I guess more to the point, it seems to make buying on eBay from the EU a roll of the VAT dice.

[pgk]

14 hours ago, M9reno said:

I know there has been some recent discussion in the Forum of the changes to VAT, and its effects on UK-EU trade.  My question is less on the technicality, and more on the application of the law, specifically in respect of items bought on eBay.

Could members please share their experience buying lenses etc. on eBay (from individual or professional sellers) from the EU since 1 Jan. 2021, specifically clarifying whether VAT is actually being applied on arrival of the item in the UK?

I ordered a lens in December from Germany.  Because of shipment stoppages related to Covid, the lens did not ship immediately, and did not arrive in the UK until early January.  It arrived normally (no VAT): did I get lucky?

You could be opening up a can of worms. Having looked into this I think that VAT is now due on any imports from the EU including, it appears, on anything from private sellers. It will be charged at standard rate + the courier's fee. There may be an exemption which is for antiques or collectables which, as long as the UK continues to be 'in sync' with EU vat law, as I assume it is at present, may make such items subject to only 5% vat - but this might need a lot of sorting out and be subject to a reclaim if successful - so keeping receipts and paperwork in order to do so is important. Many older Leica items may fall into this category perhaps/maybe/depending - could be fun sorting this out but potentially worthwhile on an expensive older film camera or lens for example. I would like to find out the reality of whether this can easily be applied if it is valid though.

Avoiding paying vat is in practice a tricky one to figure out the consequences for (apart of course from it being fraudulent🤨 and illegal!). That said if something is delivered and no vat levied I have no idea if any mechanism is in place to actually enable payment with appropriate paperwork. I've wondered about the ramifications of this and can only think that if you subsequently travel abroad and have to prove that an expensive item that you are carrying (Leica cameras and lenses may fall into this category) was sorced/imported into and is owned in the UK where it will return then paperwork which shows anything being imported without vat being paid might prove problematic at some point. The eBay GSP system levies vat but doesn't seem to differentiate antiques or collectibles, and I'd guess that trying to get a vat refund out of eBay might prove to be complicated if not impossible due to it being time consuming and uneconomic for eBay to work on individual cases.

All that said, tI have been told that he 'system' for checking what parcel items should be scrutinised and checked to see if vat is chargeable has been somewhat random and unless this changes we will sometimes pay and sometimes not. A classic British administrative 'mess'.

[willeica]

3 minutes ago, pedaes said:

The new VAT rules are going to to reflect badly on some items. If it is a VATable item, then it will not be to bad, but for "VAT free' second hand items as sold by ,say, Leicashop Vienna, we will in future have to budget for an extra cost. As the prices are high to start probably will make their stuff a no no!

Ditto going the other way from UK dealers and auctions and in our eyes Sterling is an over-valued currency. I have sent some material from a Danish source on a vintage camera website in the last few days to Peter Loy and he is trying to confirm it with HMRC. Here it is below.

"Would appreciate a view on this. Issue is buying collectible stuff from the UK either at auction or retail.

 

"Everything imported into the EU above a nominal value incurs:

1. The national VAT tax ( for Denmark, this is 25% of the total value - including transport costs).

2. For private importers, a fixed admin charge per item to the government appointed agency ( about 20 usd). 

3. For imports from the UK which originate elsewhere (for example, China) there will be extra customs tariffs. Not huge amounts but these differ for various categories.

So around 30% extra for anything I buy from the UK now! 
For me, this influences not only EBay UK, but also purchases from the many Photographica Auctions based in the UK.
This is exactly the same situation as buying from the USA to the EU has always been.

There is an escape from this terrible VAT in some situations when the item is “a collectible” or “ an antique- 100 years old”. The EU has a rule that these items from outside the EU are only charged at 5% import VAT rate. This fact is not very well known - even amongst the authorities who administer the rules! It usually takes a few emails to get the 25% down to 5%!

Using the Pitney Bowes/Ebay GSP scheme cuts the buyer off from using loophole as getting a refund is impossible without taking them to court!

Here is the EU directive - read section 6.

https://ec.europa.eu/commission/pres...ail/en/IP_95_1 "

Peter said he would attempt to check this out with HMRC.

William

 

[pedaes]

8 minutes ago, pgk said:

subject to only 5% vat

This precedent for older (Leica) cameras and lenses has been set, in that  UK auction houses recover the 5% charge, plus duty, on items temporarily imported for the auction. This of course could now be re-visited!

Edited January 23, 2021 by pedaes

[willeica]

6 minutes ago, pedaes said:

This precedent for older (Leica) cameras and lenses has been set, in that  UK auction houses recover the 5% charge, plus duty, on items temporarily imported for the auction. This of course could now be re-visited!

The issue is outside of the UK. Peter has some stories about excessive taxes being imposed by European tax authorities (eg Belgium) in the last few weeks, which is leading to cancellation of further orders emanating from GB. You should talk to him, Keith. Nobody is a winner here.

William

[pgk]

38 minutes ago, pedaes said:

This precedent for older (Leica) cameras and lenses has been set, in that  UK auction houses recover the 5% charge, plus duty, on items temporarily imported for the auction. This of course could now be re-visited!

Yes, I'd noticed this and assumed that it was the 5% antiques/collectable exemption operating. But there is far more likely to be more of a problem if an individual imports something privately and then has to reclaim vat based on this I would say. Another problem is if a retailer in the EU does not want to bother with a vat free export (I'd suggest that quite a few don't want to see their paperwork increase and why should they?) and simply sells as normal with the vat component charged (if applicable). Some areas will no doubt sort themselves out, others we may be stuck with. As Wiliam shows, there is now also the issue of 'country of origin'. Many things were not sorted out, or were sorted out badly with the last minute 'agreement' between the UK and EU and we will no doubt reap the 'benefits' of this for a long time to come. Still people seemed to want to decide to pay more for stuff so ..... . [So far I've seen many negative consequences since 1-1-21. Can someone please tell me of a +ve?].

Edited January 23, 2021 by pgk

[pedaes]

22 minutes ago, willeica said:

Nobody is a winner here.

That is for sure!! 

[jaapv]

14 hours ago, jankap said:

From the send-it click over the bill (date) to the delivery at your address.

OK, perhaps the dutch administration is in disorder, because the government is in trouble. I don´t remember why.

That would not have any influence   BTW, there is no more disarray than usual - it was a pure formality.  Anyway, the application of VAT and customs charges through the mail has always been a complete lottery in most countries.

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[willeica]

17 minutes ago, jaapv said:

That would not have any influence   BTW, there is no more disarray than usual - it was a pure formality.  Anyway, the application of VAT and customs charges through the mail has always been a complete lottery in most countries.

I agree, particularly with stuff from the US which is a 50/50 apply/no apply situation as regards tax. Calculation and collection have costs too and sometimes it is cheaper for them just to let a parcel run. One big issue for us in Ireland was the the GB 'landbridge' for deliveries to/from continental Europe. While there will continue to be trade between Britain and Ireland by ferry, the capacity requirements will be far less. Stena have already made an adjustment and have shifted one large ferry from Holyhead -Dublin - Holyhead to Dublin-Cherbourg-Dublin where it will achieve a much higher capacity loading. Things are still in a 'settling in ' period and soon surviving GB traders will have found a way of dealing with a different kind of 'new normal'. I'm just drawing attention also to the 'special status' of Northern Ireland in the 'new normal' as I have not yet worked out whether having branch operations there might work. I suspect that the extra logistics costs might outweigh any tax advantages, though .

William

Edited January 23, 2021 by willeica