Import VAT and Amazon/Kickstarter fees

custardy

bzd wrote: »

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

Tha would be if RM incorrectly charged VAT wholly.
VAT is due so the fee will stand

visidigi

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

There is one really important bit of information you've missed. The HMRC clearly state you CAN leave your commissions off your declaration.

If your shipper chooses to include them and states a total value on the declaration including them then HMRC are not going to remove this from their calculation, they look at the bottom line (electronically) where the total is listed, add duties according to tariff and then charge a total.

I am sorry, but I honestly would give up, no matter how much of a principle to you this has become.

bzd

WTFH wrote: »

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?

Ah sorry, the first time I was unclear. I aim to be refunded the amount I was overcharged, not the whole amount. That's what I meant both times.

The customs declaration says the value of goods is $90.

bzd

WTFH wrote: »

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

Hi,

No it's not going to Amazon (hence the separate Amazon payment fee I guess). HMRC define Buyers commission as

Commission: Commission is a payment made to an intermediary who acts on behalf of either the seller of the goods (selling commission) or the buyer of the goods (buying commission).

which I think covers both Amazon payment and the Kickstarter fees (i.e. a payment made by me (the buyer) to Amazon/Kickstarter (an intermediary) acting on behalf of the buyer (I asked them to take and make the payment). Now clearly Kickstarter are also acting on behalf of the seller, but for the specific service the fee is for they're acting on behalf of me (the buyer).

EDIT: sorry I've been using the wrong term, it's "Buying commission" not Buyers commission.

WTFH

Hold on, you say it's not going to Amazon, then you refer to it as "Amazon/Kickstarter".
Was the "fee" going to Amazon or someone else?
Did you buy the goods from Amazon, or from someone else? i.e. on the website, when you clicked "pay now", did the payment come out of your bank and go to Amazon, or someone else?
Were the goods shipped from Amazon, from Kickstarter or from someone else?
Who is the invoice from?

bzd

WTFH wrote: »

Hold on, you say it's not going to Amazon, then you refer to it as "Amazon/Kickstarter".
Was the "fee" going to Amazon or someone else?
Did you buy the goods from Amazon, or from someone else? i.e. on the website, when you clicked "pay now", did the payment come out of your bank and go to Amazon, or someone else?
Were the goods shipped from Amazon, from Kickstarter or from someone else?
Who is the invoice from?

Hi, There are two fees -- one from Amazon payments and one from Kickstarter. Both seem to fall under the HMRC definition of a Buying commission and so neither should have been used when determining the Customs value for VAT under HMRC's "Method 1". This is the method that UKBA applied to arrive at a Customs value. Amazon payments took the whole invoice amount from my bank account (well, credit card). The goods were shipped from the company who produced them (not Amazon or Kickstarter) who also attached the invoice to the parcel. Hope that is clear now!
Ben

visidigi

bzd wrote: »

Hi, There are two fees -- one from Amazon payments and one from Kickstarter. Both seem to fall under the HMRC definition of a Buying commission and so neither should have been used when determining the Customs value for VAT under HMRC's "Method 1". This is the method that UKBA applied to arrive at a Customs value. Amazon payments took the whole invoice amount from my bank account (well, credit card). The goods were shipped from the company who produced them (not Amazon or Kickstarter) who also attached the invoice to the parcel. Hope that is clear now!
Ben

Not really important to be honest...

The duties and taxes were levied based on the declaration made on the shipment by the sender - the declaration made no mention of commissions or any such thing according to what you have said so far - if its declared as X on the declaration HMRC will assess based on X.

HRMC allow you to leave Commissions off the declaration, they do not require them for clearance compliance. What you/HMRC define as a commission makes no difference if you still declare it on the documentation. HMRC are not aware of a commission breakdown unless identified as so.

The shipper is responsible for your overcharge here, they should not have included a fee, or should have made appropriate international clearance documentation to present to Customs with the correct items on.

bzd

I see your point there visidigi.

What confuses matters is that there's a Declaration of $90 and an itemised invoice of $130. So the fees weren't in the declaration, but then again, neither was the shipping. In this case I would expect UKBA to look at the items and work it out, and accept a mistake if they made one, hence the need for their BOR286 form if you get mischarged

BOR 286. Complete this form if you believe that Customs Duty or import VAT has been incorrectly calculated on an item you imported by Post (Royal Mail or Parcelforce).

custardy

bzd wrote: »

I see your point there visidigi.

What confuses matters is that there's a Declaration of $90 and an itemised invoice of $130. So the fees weren't in the declaration, but then again, neither was the shipping. In this case I would expect UKBA to look at the items and work it out, and accept a mistake if they made one, hence the need for their BOR286 form if you get mischarged

BOR 286. Complete this form if you believe that Customs Duty or import VAT has been incorrectly calculated on an item you imported by Post (Royal Mail or Parcelforce).

The postage would likely be on the package,no?

visidigi

HMRC levy on the absolute total declared. The HMRC statement about commissions allow you to leave them off the declaration entirely. Lots of people who ship stuff can't/won't count, or don't fully itemise every item, so in the interest of time/speed of delivery they will go off the total declared.

If your shipment is under threshold for duty and tax it goes straight through, if not they levy based on the declared amount and the shipping charges.

The form you state is for times where you think the commodity within has been charged against a specific tariff that isn't applicable, or is a higher level of tax that applies.

E.g. Clothes for children attract no tax, adult clothes do, so if you had a delivery of childrens clothes and they were levied at Adult clothing tariffs you would fill in that form for a review.

I've had plenty of shipments where I could have taken issue like you have - where I buy from a store in the US who frequently have discount codes, so I pay $100 for an item that was $150 before the voucher. The payment taken is $100 but the paperwork which comes on the delivery states the item at pre voucher price, so I get charged based on the $150 not $100.

I gave up ordering from them in the end, now I only import if the shipper lets me pay up front and they take the customs risk.