Import VAT and Amazon/Kickstarter fees

bzd

Hi,

My first port of call was to telephone Royal Mail since they were the ones I actually had to pay. This is because they automatically (without consultation) pay the VAT and add their handling fee, and then won't release the parcel to you until all of that's paid -- that's why there's also no opportunity to intervene and calculate it yourself. I have to say I think this is sensible as it means that in the vast majority of cases the item gets delivered with less of a delay. The £8 is too much but in principle Royal Mail just settling up and carrying on with the delivery makes sense.

The person at Royal Mail I spoke to told me I needed to fill in the HMRC BOR286 form and get the refund from UKBA direct, and added that if that's successful then Royal Mail are deemed to have mishandled the payment so the handling fee would be refunded by them. Odd that they volunteered the information but it doesn't seem unreasonable to me.

As for Customs not being worth dealing with I would have to agree, but I've already been through most of it and am at the last stage with the independent Tax Tribunal. Really I've dug my heels in because they've been so appalling in how they've dealt with me (did you know that if you appeal a decision and they fail to respond to you within the statutory 45 days then they automatically deem this to mean their original decision stands, i.e. they just ignore everything said in the appeal?) and I'm not willing to just roll over.

Thanks visidigi for the further clarification of the fees being transaction fees and not commissions, but I think they still fall in the HMRC description of a "buying commission" which would include any fee paid for a service made on behalf of the buyer.

I'm going to press ahead. I'll let you know how I get on!

Ben

custardy

bzd wrote: »

Hi,

My first port of call was to telephone Royal Mail since they were the ones I actually had to pay. This is because they automatically (without consultation)

We can just stop here.
Who did you have arranged to sort the VAT?
There is no mishandling if they work off the declaration
Customs decided there was VAT due. You would still be paying VAT on $90(AS I said before)
So who was doing that?

visidigi

bzd wrote: »

Hi,

My first port of call was to telephone Royal Mail since they were the ones I actually had to pay. This is because they automatically (without consultation) pay the VAT and add their handling fee, and then won't release the parcel to you until all of that's paid -- that's why there's also no opportunity to intervene and calculate it yourself. I have to say I think this is sensible as it means that in the vast majority of cases the item gets delivered with less of a delay. The £8 is too much but in principle Royal Mail just settling up and carrying on with the delivery makes sense.

The person at Royal Mail I spoke to told me I needed to fill in the HMRC BOR286 form and get the refund from UKBA direct, and added that if that's successful then Royal Mail are deemed to have mishandled the payment so the handling fee would be refunded by them. Odd that they volunteered the information but it doesn't seem unreasonable to me.

As for Customs not being worth dealing with I would have to agree, but I've already been through most of it and am at the last stage with the independent Tax Tribunal. Really I've dug my heels in because they've been so appalling in how they've dealt with me (did you know that if you appeal a decision and they fail to respond to you within the statutory 45 days then they automatically deem this to mean their original decision stands, i.e. they just ignore everything said in the appeal?) and I'm not willing to just roll over.

Thanks visidigi for the further clarification of the fees being transaction fees and not commissions, but I think they still fall in the HMRC description of a "buying commission" which would include any fee paid for a service made on behalf of the buyer.

I'm going to press ahead. I'll let you know how I get on!

Ben

Good Luck. Can tell you, the refund line from Royal Mail is a 100% refund gets your RM fees back, partial will not.

paddyrg

. I have to say I think this is sensible as it means that in the vast majority of cases the item gets delivered with less of a delay. The £8 is too much but in principle Royal Mail just settling up and carrying on with the delivery makes sense.

I guess the problem is that despite agreeing that the system is probably a good idea to avoid delays in the majority of cases, you did nothing in advance to alert Royal Mail to your preference to self-clear in advance of them having to do the work. If you want to self clear, you get the sender to note to that effect on the customs label on the package before posting. That means the handlers have a way of knowing that that individual wants to make their own arrangements in their own time.

If it's any consolation, £8 is cheap. Most other couriers it's around £15, except one of the DHL services where it's charged as a percentage (but the courier fee is typically significantly higher, plus the tax and fees apply to that higher courier fee as well). Also be aware self-clearing means your goods need bonded warehouse space and handling, RM include that in their fee where a third party may levy charges - a friend once had to pay a tenner a day to as bonded warehouse holding a small rug he bought - first 7 days were free then went up to a pre day cost. He was busy and didn't get the paperwork done in time! Paperwork itself is good for at least an hour of work for a small/first time importer, another compelling justification for the £8 to let someone else do it for you!

WTFH

visidigi wrote: »

The invoice total is imperatively important. It has to itemise whats in the box at the point of clearance. If the invoice said one went to the US and on to the UK it wouldn't clear. At all.

Have we found out what the invoice total was yet?

bzd

Hi,

Number of questions I could clear up:

The Customs certificate declaration of the value of goods (or whatever it's called) was displayed clearly on upper left of the address label and said the value of the goods was $90. I'm not disputing paying VAT on that. I also know they can charge VAT on the shipping, which is listed on the invoice (displayed on the right of the address lable) as $15.
The invoice showed, itemised, the goods ($90), the shipping ($15) and the Amazon and Kickstarter fees (can't remember the exact amount for each, around $12 each), with an invoice total of $130.

So to be clear: I agree that the $90 and $15 are subject to VAT, I don't believe the Amazon and Kickstarter fee (listed separately in the invoice) are subject to VAT. I'll let you know how that gets on. If Amazon payment and Kickstarter fees are classed as "buying commisions" then I am correct. To me they appear to be so:

(HMRC Reference:Notice 252 paragraph 3.16(f))

3.16 Can I leave out any items from the customs value?

Yes. The following items may be left out of the customs value:
...
(f) Buying commission. You may leave out fees or brokerage paid to your agent for representing you outside the EC in buying imported goods, providing the commission is shown separately from the price paid or payable for the goods.

This is part of UKBA's "Method 1" for calculating VAT, and the method UKBA followed.

Also, I didn't want to self-declare, what I wanted was UKBA to get it right! There would have been no way to get the sender to adjust the label (it was a pretty intensive mass-mailed affair coming from Singapore). Not that I knew you could do that anyway.

I have since sent the appropriate reclaim form and had it essentially ignore, an appeal, and had it completely ignored (well, they sent a response saying we too too long to look at your appeal so we were right)! Ridiculously I've had to fill in a tax tribunal case to get them to read my letter. Yes I know this all sounds like complete overkill, but I just want them to read my points (which they are now doing) which only uses their own definitions and process. And relax...

Anyway, I'll see what they say next...

Cheers all,

Ben

custardy

bzd wrote: »

Hi,

Number of questions I could clear up:

The Customs certificate declaration of the value of goods (or whatever it's called) was displayed clearly on upper left of the address label and said the value of the goods was $90. I'm not disputing paying VAT on that. I also know they can charge VAT on the shipping, which is listed on the invoice (displayed on the right of the address lable) as $15.
The invoice showed, itemised, the goods ($90), the shipping ($15) and the Amazon and Kickstarter fees (can't remember the exact amount for each, around $12 each), with an invoice total of $130.

So to be clear: I agree that the $90 and $15 are subject to VAT, I don't believe the Amazon and Kickstarter fee (listed separately in the invoice) are subject to VAT. I'll let you know how that gets on. If Amazon payment and Kickstarter fees are classed as "buying commisions" then I am correct. To me they appear to be so:

(HMRC Reference:Notice 252 paragraph 3.16(f))

3.16 Can I leave out any items from the customs value?

Yes. The following items may be left out of the customs value:
...
(f) Buying commission. You may leave out fees or brokerage paid to your agent for representing you outside the EC in buying imported goods, providing the commission is shown separately from the price paid or payable for the goods.

This is part of UKBA's "Method 1" for calculating VAT, and the method UKBA followed.

Also, I didn't want to self-declare, what I wanted was UKBA to get it right! There would have been no way to get the sender to adjust the label (it was a pretty intensive mass-mailed affair coming from Singapore). Not that I knew you could do that anyway.

I have since sent the appropriate reclaim form and had it essentially ignore, an appeal, and had it completely ignored (well, they sent a response saying we too too long to look at your appeal so we were right)! Ridiculously I've had to fill in a tax tribunal case to get them to read my letter. Yes I know this all sounds like complete overkill, but I just want them to read my points (which they are now doing) which only uses their own definitions and process. And relax...

Anyway, I'll see what they say next...

Cheers all,

Ben

So VAT is due
You didnt want to self declare
So you are claiming the RM fee back for........?

bzd

Hi custardy,

I'm claiming the RM fee back because RM told me I could if the VAT charged was incorrect. I don't know why (I assume because they "mishandled" the payment?), but I was told by RM that I could. I am very doubtful it will work, but I will also give it a shot! (the process wasn't meant to drag on so long, but that's UKBA's fault).

Cheers,

Ben

WTFH

Why do you think the Kickstarter is a "buyers commission"? It's not going to Amazon, is it?

WTFH

bzd wrote: »

The person at Royal Mail I spoke to told me I needed to fill in the HMRC BOR286 form and get the refund from UKBA direct, and added that if that's successful then Royal Mail are deemed to have mishandled the payment so the handling fee would be refunded by them. Odd that they volunteered the information but it doesn't seem unreasonable to me.

bzd wrote: »

I'm claiming the RM fee back because RM told me I could if the VAT charged was incorrect. I don't know why (I assume because they "mishandled" the payment?), but I was told by RM that I could. I am very doubtful it will work, but I will also give it a shot!

OK, you've told us two different things here. First is that RM will refund if you get a refund from UKBA, then you've changed that to "if the VAT charged was incorrect" then you'd get a refund.
That's not the same.

Next question:
What does the customs declaration say?