VAT on Purchased coins from abroad

[Gollum 2]

I put this here because it's a kind of beginners question I always wanted to ask from the start, so if i buy a silver shilling from say malta, USA or the likes do you have to pay VAT or import duties on them. Is the VAT on historic collectors coins ( I think thats right ) only applcable to UK sold coins etc.

Thanks

Edited January 19, 2012 by Gollum

[azda 979]

I put this here because it's a kind of beginners question I always wanted to ask from the start, so if i buy a silver shilling from say malta, USA or the likes do you have to pay VAT or import duties on them. Is the VAT on historic collectors coins ( I think thats right ) only applcable to UK sold coins etc.

Thanks

Well, me being Scottish (apparently we're tight) thought, to get around always paying tax in Gemrnay on every purchase outside the EU i'd get a friend of mine in the UK to buy a coin for me from the USA:

Today he tells me the coin has arrived and parcelforce have gave him a wee letter saying i'm owing another 38 f*****g quid for tax, i would have been cheaper buying it myself and letting the Germans tax me 7% instead of the near 30% that i've had to pay.

I really thought Germay was bad for taxation, but that just pales into insignifigance as to what i've just had to add to the UK Governments coffers. 7% German tax or near 30% UK tax, hmmmmm thats a toughie

Edited January 19, 2012 by azda

[Gollum 2]

I put this here because it's a kind of beginners question I always wanted to ask from the start, so if i buy a silver shilling from say malta, USA or the likes do you have to pay VAT or import duties on them. Is the VAT on historic collectors coins ( I think thats right ) only applcable to UK sold coins etc.

Thanks

Well, me being Scottish (apparently we're tight) thought, to get around always paying tax in Gemrnay on every purchase outside the EU i'd get a friend of mine in the UK to buy a coin for me from the USA:

Today he tells me the coin has arrived and parcelforce have gave him a wee letter saying i'm owing another 38 f*****g quid for tax, i would have been cheaper buying it myself and letting the Germans tax me 7% instead of the near 30% that i've had to pay.

I really thought Germay was bad for taxation, but that just pales into insignifigance as to what i've just had to add to the UK Governments coffers. 7% German tax or near 30% UK tax, hmmmmm thats a toughie

Thank you Azda, that has put paid to me buying any silver proofs from canada or australia, I liked the look of those year of the dragon coins or from USA.

[davidrj 194]

I put this here because it's a kind of beginners question I always wanted to ask from the start, so if i buy a silver shilling from say malta, USA or the likes do you have to pay VAT or import duties on them. Is the VAT on historic collectors coins ( I think thats right ) only applcable to UK sold coins etc.

Thanks

Well, me being Scottish (apparently we're tight) thought, to get around always paying tax in Gemrnay on every purchase outside the EU i'd get a friend of mine in the UK to buy a coin for me from the USA:

Today he tells me the coin has arrived and parcelforce have gave him a wee letter saying i'm owing another 38 f*****g quid for tax, i would have been cheaper buying it myself and letting the Germans tax me 7% instead of the near 30% that i've had to pay.

I really thought Germay was bad for taxation, but that just pales into insignifigance as to what i've just had to add to the UK Governments coffers. 7% German tax or near 30% UK tax, hmmmmm thats a toughie

It's not the tax per se, it's the exorbitant fee the Royal mail charges for collecting the duty,

I've been caught twice, but that's a very low percentage of the number of packets I've received from overseas. Pot luck really

[Rob 3,152]

The actual rate of import VAT is only 5% compared to the normal rate of 20%, so if they charge 20% refuse to pay it and get them to recalculate. As David says, it is the RM admin fee that bumps the price up. Until you are talking a couple of hundred pounds in value, the admin fee exceeds the tax, but at this point the effective rate is about 10%.

Edited January 20, 2012 by Rob

[Gollum 2]

The actual rate of import VAT is only 5% compared to the normal rate of 20%, so if they charge 20% refuse to pay it and get them to recalculate. As David says, it is the RM admin fee that bumps the price up. Until you are talking a couple of hundred pounds in value, the admin fee exceeds the tax, but at this point the effective rate is about 10%.

I think that is disgusting, if you have no other way of importing them other than by Royal Mail service then you are surely being forced to pay an admin fee you did not agree to, that is as far as I can see a contract you did not enter into willingly. Surely that can be tested in a court. What if you paid it directly to the inland revenue or customs or whoevr it is, are they still entitled to charge you ?.

Edited January 20, 2012 by Gollum

[azda 979]

The actual rate of import VAT is only 5% compared to the normal rate of 20%, so if they charge 20% refuse to pay it and get them to recalculate. As David says, it is the RM admin fee that bumps the price up. Until you are talking a couple of hundred pounds in value, the admin fee exceeds the tax, but at this point the effective rate is about 10%.

Here in Germany we're allowed €22 thereafter its charged at 7%. The coin i bought was $167 and i've been charged 24 pound odd import charge and 13 something clearance fee, which is as i've said f*****g outrageous. They've based everything on the 167 dollars, not on what the dollar is to the pound, so charged like it was 167 pounds and not what it should actually be, 108 quid

[bagerap 706]

Ask North American sellers to send via UPS. They don't make a meal out of customs clearance, simply calculate it correctly and don't overcharge for admin. DHL is similar but variable. Yes the shipping charges will be higher, but you'll pay a hell of a lot less duty.

[azda 979]

H the bill he sent me over the iphone, its in 2 parts but the same bil. Now bear in mind its a $167 coin and i'm paying 24 quid for import charges, i still think its wrong

Edited January 20, 2012 by azda

[Rob 3,152]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

[azda 979]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up, although saying that, i phoned my brother-in-law earlier (he's an accountant) and he said 20% applies, so i'm fooked if i know right now. Also if you look at the wording in the 1st picture, it states that parcelforce are unable to enter disputes............

Edited January 20, 2012 by azda

[Rob 3,152]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up

If still at the PO, you could question why the excessive charge at the desk. If the description says coin, then the RM have screwed up, but if the description is misleading, then the RM are perfectly entitled to charge what would be the appropriate rate. The application of 20% vat suggests the value inserted on the customs form is correct, so the description is also likely to be correct. I'm going for the shared brain cell making a balls up.

And you only have a finite time to challange it before the package is returned. It will be held until the correct tax is paid. Time is of the essence.

Edited January 20, 2012 by Rob

[azda 979]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up

If still at the PO, you could question why the excessive charge at the desk. If the description says coin, then the RM have screwed up, but if the description is misleading, then the RM are perfectly entitled to charge what would be the appropriate rate. The application of 20% vat suggests the value inserted on the customs form is correct, so the description is also likely to be correct. I'm going for the shared brain cell making a balls up.

And you only have a finite time to challange it before the package is returned. It will be held until the correct tax is paid. Time is of the essence.

20 days. My buddy is'nt the sharpest tool in the box though, so either he's gonna have to give the paper to my brother-in-law or i'm gonna challenge it from here. Will perhaps start morning

[Rob 3,152]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up, although saying that, i phoned my brother-in-law earlier (he's an accountant) and he said 20% applies, so i'm fooked if i know right now. Also if you look at the wording in the 1st picture, it states that parcelforce are unable to enter disputes............

Coins imported from outside the EU attract 5% import VAT. That is the same 5% charge applying to imported lots in auctions such as Spink or DNW. e.g lot 107 in Spink's last sale (13/12/2011) was marked with an x, signifying VAT of 5% would be applied to the hammer price and 20% to the buyers premium because the coin was imported into the EU under temporary import rules, but the buyers premium was incurred entirely within the EU. Unless the rules have changed since the middle of December, the 5% rule should still apply.

Parcelforce collects the VAT for HMRC, but a mechanism still exists to challenge incorrect taxation. Go to the PO counter and get it sorted - quickly because it might take a few days and the parcel will only be held for a week or two at the most.

Edited January 20, 2012 by Rob

[azda 979]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up, although saying that, i phoned my brother-in-law earlier (he's an accountant) and he said 20% applies, so i'm fooked if i know right now. Also if you look at the wording in the 1st picture, it states that parcelforce are unable to enter disputes............

Coins imported from outside the EU attract 5% import VAT. That is the same 5% charge applying to imported lots in auctions such as Spink or DNW. e.g lot 107 in Spink's last sale (13/12/2011) was marked with an x, signifying VAT of 5% would be applied to the hammer price and 20% to the buyers premium because the coin was imported into the EU under temporary import rules, but the buyers premium was incurred entirely within the EU. Unless the rules have changed since the middle of December, the 5% rule should still apply.

Parcelforce collects the VAT for HMRC, but a mechanism still exists to challenge incorrect taxation. Go to the PO counter and get it sorted - quickly because it might take a few days and the parcel will only be held for a week or two at the most.

It says on the paper (the picture i uploaded) 20 days. I'll ask the brother-in-law again about import charges, is the 5% just on coins outside the EU, or everything?

Edited January 20, 2012 by azda

[Rob 3,152]

So they have charged import vat at 20% instead of 5%. This is what needed to be challenged. If a misleading description was put on the customs form though, the 20% could apply. Attempting to mislead would be thieves by replacing coin with cuddly toy in the description would backfire on the VAT front.

I doubt it would be misleading, it came froma large US dealer and i doubt he'd do that. I'm gonna call my buddy tomorrow and tell him to hang fire and not pay until this is cleared up

If still at the PO, you could question why the excessive charge at the desk. If the description says coin, then the RM have screwed up, but if the description is misleading, then the RM are perfectly entitled to charge what would be the appropriate rate. The application of 20% vat suggests the value inserted on the customs form is correct, so the description is also likely to be correct. I'm going for the shared brain cell making a balls up.

And you only have a finite time to challange it before the package is returned. It will be held until the correct tax is paid. Time is of the essence.

20 days. My buddy is'nt the sharpest tool in the box though, so either he's gonna have to give the paper to my brother-in-law or i'm gonna challenge it from here. Will perhaps start morning

If it has been paid already, you will have to apply to HMRC for a refund, but will need all the documentation including invoices and proof of payment. I don't know which department you would call, but there will be some means of reimbursement. Just be aware of it for the future. Whilst we all like import tax free goods that get through the system unchecked, we also like the process to be painless and efficient with the correct tax paid if applied. Probably a case of be careful what you wish for. Sometimes the fully legit route is not as bad as the alternatives.

[Rob 3,152]

It says on the paper (the picture i uploaded) 20 days. I'll ask the brother-in-law again about import charges, is the 5% just on coins outside the EU, or everything?

It applies to coins imported from outside the EU, but there may be other categories that are also favourably treated. Most goods are 20%, but books are zero rated in the UK for example. It also depends on the country into which it is imported. Once VAT has been charged at the appliciable rate in a specific country, it is deemed to have been paid throughout the EU. Chris does this with books which are sold from the UK where they attract 0% VAT as opposed to what the going rate is in Germany. I charge my customers UK VAT if our rate is below that of their country. If our rate is above that of the recipient's I will export VAT free against a VAT number and let them pay their home rate of import VAT. The only difference is the amount changes in two boxes on your VAT return. It may only be a percent or two to the end user, but any reduction in money available to p*** against the wall by the snouts in troughs is to be welcomed.

Edited January 20, 2012 by Rob

[azda 979]

Just an update. Got my brother-in-law (he's an accountant) to do some digging on this subject very close to my heart, here's what he found.

I have been charged VAT and duty for goods bought over the internet, why is this?

All goods imported into the UK from countries outside the EU are subject to Import Duty and VAT at the rates applicable.However, import VAT is not payable on commercial consignments if the total value of the goods in the consignment does not exceed £18 (£15 with effect from 1 November 2011). If this tax was not applied, there would clearly be an unfair advantage to foreign businesses over UK trade. This limit is raised to £40 for personal gifts between private individuals.Where the value of gifts is below £630 per consignment, a flat rate of Customs Duty of 2.5 per cent will be applied – but only if it is to your advantage.Customs Duty becomes payable if the value of the goods is over £135 but duty is waived if the amount of duty calculated is less than £9.Please note if your goods are subject to customs charges, there may also be a handling fee to pay to the carrier.For further information see:

[Rob 3,152]

Just an update. Got my brother-in-law (he's an accountant) to do some digging on this subject very close to my heart, here's what he found.

I have been charged VAT and duty for goods bought over the internet, why is this?

All goods imported into the UK from countries outside the EU are subject to Import Duty and VAT at the rates applicable.However, import VAT is not payable on commercial consignments if the total value of the goods in the consignment does not exceed £18 (£15 with effect from 1 November 2011). If this tax was not applied, there would clearly be an unfair advantage to foreign businesses over UK trade. This limit is raised to £40 for personal gifts between private individuals.Where the value of gifts is below £630 per consignment, a flat rate of Customs Duty of 2.5 per cent will be applied – but only if it is to your advantage.Customs Duty becomes payable if the value of the goods is over £135 but duty is waived if the amount of duty calculated is less than £9.Please note if your goods are subject to customs charges, there may also be a handling fee to pay to the carrier.For further information see:

That's even muddier than it was before. At least the 5% for coins was easy to understand

Edited January 20, 2012 by Rob

[azda 979]

Long and short of it is, up to 18 quid is free, after that you Pay 20% on the total value plus insurance plus postage

[Gollum 2]

Just an update. Got my brother-in-law (he's an accountant) to do some digging on this subject very close to my heart, here's what he found.

This limit is raised to £40 for personal gifts between private individuals.

I suddenly have a lot of foreign relatives

[Peter 615]

I guess I've just been lucky.

Never 1 import bill to date and I've bought a lot from the US.

I will factor in the risk in the future.

[Rob 3,152]

Long and short of it is, up to 18 quid is free, after that you Pay 20% on the total value plus insurance plus postage

But that still doesn't explain why coins in UK auctions that are sold by non-EU residents attract the 5% VAT instead of 20%. As I said before, the 5% rule was in force last December, so barring a change in the law over Christmas/New Year, this should still apply. I still suspect that someone somewhere in customs or their agents doesn't realise that coins are taxed at a reduced rate. I vaguely remember someone saying it is something to do with them being classed as collectables or artefacts, but can't think where I read it.

[Gary D 76]

Long and short of it is, up to 18 quid is free, after that you Pay 20% on the total value plus insurance plus postage

But that still doesn't explain why coins in UK auctions that are sold by non-EU residents attract the 5% VAT instead of 20%. As I said before, the 5% rule was in force last December, so barring a change in the law over Christmas/New Year, this should still apply. I still suspect that someone somewhere in customs or their agents doesn't realise that coins are taxed at a reduced rate. I vaguely remember someone saying it is something to do with them being classed as collectables or artefacts, but can't think where I read it.

As far as I'm aware coins fall into the same catagory as antiques and are only subject to 5% VAT. no customes duty. Rather than just put coin etc on the customs form you should put the customs comodity code for that artical on the form then no confusion. The codes are available from the IR website.

[azda 979]

Long and short of it is, up to 18 quid is free, after that you Pay 20% on the total value plus insurance plus postage

But that still doesn't explain why coins in UK auctions that are sold by non-EU residents attract the 5% VAT instead of 20%. As I said before, the 5% rule was in force last December, so barring a change in the law over Christmas/New Year, this should still apply. I still suspect that someone somewhere in customs or their agents doesn't realise that coins are taxed at a reduced rate. I vaguely remember someone saying it is something to do with them being classed as collectables or artefacts, but can't think where I read it.

As far as I'm aware coins fall into the same catagory as antiques and are only subject to 5% VAT. no customes duty. Rather than just put coin etc on the customs form you should put the customs comodity code for that artical on the form then no confusion. The codes are available from the IR website.

I doubt an American will know the customs commodity code Gary, even i don't know it, but i think this should be investigated further for future reference should it happen to anyone else.