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Belcher Bits sales and VAT


belcherbits

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To all UK modellers. I have just posted the following information on my website (www.belcherbits.com).

 

Because of some stupid UK rule changes about VAT collection, I will no longer be selling directly to UK customers and if you want any of my products, please look for them on my new eBay store “Belcher Bits Store”. (Non-UK buyers should not use this service; it's much cheaper to order from me as described on my website). Not all products will be available at all times, although I will try to keep the store stocked with popular items. Just to highlight to all UK customers, the list price is higher on the eBay store to cover additional fees, and you will have to pay VAT on the item and on shipping, so send your government a big thank-you note next time you talk to them. Please do not ask for your parcel to be marked as gift to avoid duty or VAT. It’s a sale, not a gift. Sorry.

 

I regret having to make this change to my business, as up 'til now, I have had a lot of business from the UK. However, the new policy on VAT collection at source (i.e by me, on behalf of the UK government) would have meant a tremendous burden in administration costs for these sales, would have required that I (as a Canadian) register with the VAT in the UK and give the same department the authority to audit my records. Using eBay instead means they (who already are VAT registered and set up for international tax collection) look after all this. The real loser in all this is the UK consumer. My prices on my eBay site are higher to cover the eBay fees, and UK consumers end up paying VAT on the full declared value AND on shipping, which never happened before. Furthermore, the old GBP 15.00 lower limit on orders (where many of my sets fell under) no longer exists; you folks will have to pay VAT on everything.

I'm not sure of the reasons for this change. It is released as a consequence of Brexit, but it also appears like a simple money grab by your government, getting a foreign company to do a UK job at no cost to yourself. It may also be a ham-handed attempt to force foreign sellers to stop dealing with UK customers directly, and instead sell their products through UK distributors. Whatever the thinking (or lack thereof) behind these new rules, the real losers will be UK modellers. Some foreign suppliers will find workarounds, but many will simply stop selling to the UK at all. 

Mike Belcher, Belcher Bits

 

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Yes, the EU is going to do this as well as the UK, and it isn't stupid.  It is in order to avoid the tax avoidance common with on-line off-shore sales, and to ensure that local suppliers are not trading at a disadvantage.   The phrase "a level playing field" is used.  Despite the OP's comments, VAT was always payable on the item and on the shipping costs.  The cost to the buyer should not change, as the supplier/agent should always have these additional charges anyway, if indirectly.

 

It is sad that rules required to combat the criminal and amoral end up as problems for the honest small business, but that is the nature of the world we live in.

 

There is a long and fairly sharp-spoken, often ill-informed, thread on this already, which has been running for some time now.

 

 

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Its a new law here but I would not say its stupid. A lot of Govts are doing this to get back tax revenue whether we agree with it or not. This is not a consequence of Brexit as the  EU is doing this come July. Other countries have already done this, and im sure tohers will follow suit. 

 

Julien

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I have seen more and more of these international suppliers having this reaction.  If people are going to boycott us then we shall just have to start making our own.  I have.

I, for one, will not be going back to these suppliers if they ever re-start supplying to the UK again.

 

Mike

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1 hour ago, Graham Boak said:

 The cost to the buyer should not change, as the supplier/agent should always have these additional charges anyway, if indirectly.

 

Not true. I sell the Lancaster Engine set on my website for $29.99. On my eBay store, it is listed at $35. With VAT on that cost as well as on shipping, the cost will be $55.20 vs $49.20. Buying through eBay will cost the consumer an additional $6.00. It adds up.

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1 hour ago, Julien said:

Its a new law here but I would not say its stupid. A lot of Govts are doing this to get back tax revenue whether we agree with it or not. This is not a consequence of Brexit as the  EU is doing this come July. Other countries have already done this, and im sure tohers will follow suit. 

 

Julien

Julien

Its not the tax I disagree with, its how it is to be collected. If you (as a Brit) want to make sure your country gets all the tax revenue it is entitled to, then go ahead and collect it ... in your country, by your tax collectors. Don't make me do it.

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28 minutes ago, bootneck said:

I have seen more and more of these international suppliers having this reaction.  If people are going to boycott us then we shall just have to start making our own.  I have.

I, for one, will not be going back to these suppliers if they ever re-start supplying to the UK again.

 

Mike

I am not boycotting the UK. By setting up an eBay store I am taking on  a fair amount of work keeping this running, in order to supply the UK customers. Its just something I shouldn't have had to do.

Mike B

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4 hours ago, belcherbits said:

Not true. I sell the Lancaster Engine set on my website for $29.99. On my eBay store, it is listed at $35. With VAT on that cost as well as on shipping, the cost will be $55.20 vs $49.20. Buying through eBay will cost the consumer an additional $6.00. It adds up.

But does that not mean I won't have to pay import VAT when the item arrives in the UK there by saving the £11 Parcel Force handling fee?

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7 hours ago, belcherbits said:

Julien

Its not the tax I disagree with, its how it is to be collected. If you (as a Brit) want to make sure your country gets all the tax revenue it is entitled to, then go ahead and collect it ... in your country, by your tax collectors. Don't make me do it.

 

Sadly, this seems to be the way the world is going. The UK were not the first (Australia and New Zealand have been doing it for a while), and the EU is following in July. When it comes to products like these, with limited availability and distribution, everyone's a loser...

 

Jon

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17 hours ago, Tbolt said:

But does that not mean I won't have to pay import VAT when the item arrives in the UK there by saving the £11 Parcel Force handling fee?

True, but many of my products used to fall under the GBP 15 lower limit where apparently no VAT or handling fee was charged? Anyways, that lower limit is now gone as well :(

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2 hours ago, belcherbits said:

True, but many of my products used to fall under the GBP 15 lower limit where apparently no VAT or handling fee was charged? Anyways, that lower limit is now gone as well :(

 

I am pretty sure, as Graham mentioned above, that VAT was charged on the total price, including shipping. Certainly when I had to pay it, I paid VAT on the shipping. Thus it was very difficult indeed to source an item from North America that was not liable for VAT given shipping costs.

 

Jon

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The difference between buying from either North America or Japan previously was that we'd always pay the VAT on goods + shipping + handling fee, whilst stuff sourced from eBay dispatched from another large economy out east were habitually defrauded and marked as gifts or under-declared for tax evasion purposes. 

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I have some sympathy with those foreign companies being asked to act as unpaid tax collectors and I certainly wouldn't do it in fact I make sure in my business that my turn over never breaches the vat threshold by stopping trading for that year if it comes close.

 

Getting vat back on what I buy just isn't enough to offset the chew on of doing the bidding of the tax overseers.

 

There was system in place before called customs whose job it was to intercept incoming packages and apply vat and duty on behalf of the government, the PO got involved by paying these costs and then holding your goods hostage 'till it was paid and then charging you for the "service".

 

In the past when the exchange rate was better I used to bring in a lot of stuff from the US and over the course of three years only one package in four was stopped and had the correct vat and duty applied, all packages were sent with an honest customs declaration as to value, content and postage as I dealt with reputable companies but Customs failed to collect. All my prices were set at having paid what was due, this then gave me a moral dilemma about pricing for anticipated cost against pricing for real cost, at one point I actually contacted customs to say a package had come through without attracting the levies and to say that I wasn't taken seriously by customs is an understatement. In the end I priced at actual cost, which again caused customer issues when stuff was stopped and vat and duty charged and prices went up for the contents of that shipment.

 

Whilst I may not like taxes they are the law of the land and must be paid and the only way a tax can be in any way fair is if it is applied evenly. The previous system did not and now we have this situation.

 

Yes I am sure there is a lot of fraud as well with untrue declarations but at the end of the day enforcement is the only way stamp such practices out, I still think this a bit wrong for governments to be foisting their tax collecting duty onto foreign third parties, 'twill not effect the ebay's of this world and as always with such things it is the honest little person and business that suffers as a consequence.

 

 

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Well I had today a sell from my private collection(from the Netherlands)  to the UK and boy i hope  I figured it out correctly with the number part of which number needs to be were ...

Would have been a lot easier if they had an example for those forms on e-bay of which number is to be put in where..or had a tax form to be printed as they already have all the information.
Thankfully when somebody orders a kit they have a pdf form with all the info from e-bay and their vat numbers and so on..

Lets see if it ‘s all working correctly on both sides🤪

 

cheers, Jan

 

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  • 7 months later...
  • 3 weeks later...

Why would the recipient gotta pay Vat for postage?

I'm sure, sender had his tax already included in the postal price.

It works (I hope) with other mail, or you have to put few bobs on the Post Office table to collect a letter from Canada? 🤪

Hopefully, sooner or later, somebody will start a business importing/ distributing all those big and small bits.

Zig

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On 2/16/2021 at 6:02 PM, dromia said:

There was system in place before called customs whose job it was to intercept incoming packages and apply vat and duty on behalf of the government, the PO got involved by paying these costs and then holding your goods hostage 'till it was paid and then charging you for the "service".

 

Although I don't like the PO charge either, that's not strictly how it works. The government expect Royal Mail to collect the VAT and duty for them, but do not pay them for doing their work. They got involved because they were told to. This of course costs Royal Mail in time and many staff hours, and believe me, it's not a small undertaking by any stretch of the imagination. So Royal Mail are going to pass that cost on to us. Not good for us, but that's the way it is. I say this from the perspective of having worked there.

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Under HMRC rules, duty and/or vat is payable at variable rates on the total cost of any item arriving in the UK. Terms are classified as CIF - Cost, Insurance and Freight, and they are entitled to see evidence of this. No difference if it's a packet of resin, or a bulk shipment in multiple containers. Nothing to do with other terms of trading. This has been in force since God was a boy, and I was certainly processing imports in this manner 50 years ago. Membership of any trading bloc notwithstanding.

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Gents this topic has so been done to death.

 

Its not stupid it the rules. They have been there for a long time. The PO charge a fee which is well below any commercial rate. If you dont like this dont take the chance and buy from aboard. 

 

If companies dont want to sell to the UK & EU who are also bringing this in then they dont have to.  Some have gone down the route of registering for UK VAT which does not seem easy to do, but they have done it and it works.

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