Questions about VAT on buying items from USA

I was looking on ebay for an item I need and found a seller in America. I contacted them about the shipping costs and they told me that I would need to pay VAT if I was from the UK. The item is £1600, so this is £320.00. Is this correct for them to charge me the 20% VAT. Previously I have seen ebay adverts from UK sellers that state no VAT paid if outside the UK.
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  • superbigal
    superbigal Posts: 600
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    edited 13 September 2022 at 1:27PM
    You should not be paying the Seller VAT as no Vat is Chargeable.
    You are liable for 20% Import Vat however and any possible Import Duty depending on what you are buying.
    You should be paying the Import VAT and Duty demand to whoever comes looking for it when your goods are clearing in the UK.
    Ie DHL or Fedex etc.
    They will also charge a handling fee of circa £15
  • Thanks for the info. If I bought the same item from Czech Republic would I have to pay VAT.
  • Spoonie_Turtle
    Spoonie_Turtle Posts: 8,304
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    edited 13 September 2022 at 1:53PM
    LouiseAH said:
    Thanks for the info. If I bought the same item from Czech Republic would I have to pay VAT.
    Yes.
    (Before we left the EU, you wouldn't have, but now we have to pay import VAT and possibly customs duty for things from anywhere outside the UK.)
  • The product is a digital product. It's an online course. So would I still need to pay the 20% import duty? 
  • How are there shipping costs if it's a digital product?
  • RFW
    RFW Posts: 10,009
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    LouiseAH said:
    I was looking on ebay for an item I need and found a seller in America. I contacted them about the shipping costs and they told me that I would need to pay VAT if I was from the UK. The item is £1600, so this is £320.00. Is this correct for them to charge me the 20% VAT. Previously I have seen ebay adverts from UK sellers that state no VAT paid if outside the UK.
    To charge you UK VAT they'd need to be registered in the UK, which they may well be.
    You could ask for their VAT number in advance of paying.
    As it's a lot of money and sterling is really low against the dollar you could try asking for a discount.



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  • Altior
    Altior Posts: 616
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    The UK changes at a glance

    1. eBay is obliged to collect UK VAT on goods sold through eBay to UK customers in the following circumstances:
      • Goods imported into the UK, with a parcel value of up to £135. Note that there is no longer a VAT exemption for small consignments up to £15
      • Goods of any value sold by a non-UK seller and shipped from inventory stored in the UK. Sellers may still have UK VAT obligations and should consult their tax advisors for further information
      If an order fits either of these criteria, neither sellers nor carriers should collect VAT from UK buyers. eBay will collect the VAT from the buyer and remit it to HMRC.
    eBay will not collect UK VAT if:
    • Consignment values are above £135. In practice, the recipient pays import VAT to the shipping agent as part of clearing the package through customs

    There's nothing about services in eBays help pages, but it appears they won't apply vat on the purchase. I suspect it will be down to the seller's local legislation if they charge any sales tax, as unless you are a vat registered business, you'll have no requirement to report reverse charge vat. 
  • Altior
    Altior Posts: 616
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    Other interesting elements of the help pages:
    1. How VAT appears to buyers:
      • All prices on eBay.co.uk will be displayed inclusive of UK VAT. UK buyers will see VAT-inclusive pricing when they view listings in search and on the listing page
      • Where eBay is responsible for collecting VAT on orders sent to a UK delivery address, this amount will also be shown separately on the invoices issued to buyers
    2. eBay seller tax-related responsibilities:
    • Sellers may be required to collect VAT in cases where eBay is not obliged to collect VAT, for example if the buyer is a VAT registered buyer. In these cases, eBay will provide you with the buyer's details so that VAT can be collected correctly
    A reasonable assumption I feel therefore is if this is a b2c and not b2b transaction, there is no VAT requirement from HMRC's or eBay's perspective.
  • Is it a physical product, e.g. on a disc posted to you?  If so, you'll have Import VAT and customs duties when it enters the country.  If it is sent via the Global Shipping Programme they collect the fees - your payment at checkout - and then pay them on your behalf when it enters the country.

    If not, that's where it gets tricky - online marketplaces (including eBay) do not collect VAT for purchases over £150.  The question then is whether purely digital goods are liable for VAT.

    Altior said:
    A reasonable assumption I feel therefore is if this is a b2c and not b2b transaction, there is no VAT requirement from HMRC's or eBay's perspective.
    You've got that wrong.  As you are a consumer you should be paying VAT if the product is liable for it.


    If it is a purely digital product, it is ultimately up to the seller to know how to deal with any legal obligation regarding sales taxes based on where their customers are located.
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