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Worried about Brexit VAT?

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Topic: Worried about Brexit VAT?

Posted By: Graham Slee
Subject: Worried about Brexit VAT?
Date Posted: 21 Nov 2020 at 4:21am

Get ready! For what? (does anybody actually know?)

Although Brexit happened a year ago, the European VAT (sales tax) doesn't change until January 1st 2021.

On January 1st, our European customers will not pay us VAT anymore, so our price to them will be the same as to the rest of the world - that's 20% less, but, wait for it...

VAT is so funny. Say the price was 100 Pound sterling, and so 20% VAT makes it 120 Pound sterling; how do you take off 20%?

You could multiply it by 0.8, but then it would be 96 Pound sterling. Wouldn't that be great?

Or, you could divide it by 1.2, and you'd get the real answer of 100 Pound sterling. We know a rhyme about that.

Polly put the V-A-T on, ... Sukey took it off again, ... then (48 years later) the VAT went away.

That was the easy part, and I'm sure savvy European customers already know that. But what worries them (you/him/her/it) most is being charged VAT twice if they order and pay for something before midnight on December 31st but don't receive it until the new year.

We will use the pre-January-1st order date as the date and tax point of sale, which cannot be argued with. The COMMERCIAL INVOICE / SALES INVOICE accompanying the parcel will show that VAT has been paid. The package will also have a sticker on it to alert customs agents to the fact.

At 00:01 hours, January 1st, we hope to have switched over the automatic EU VAT charge on our online shop to zero VAT ...

The Internet will most probably crash with thousands of UK online shops doing it at the same time, but I'm sure it will add to the fun!

... and from then the COMMERCIAL INVOICE / SALES INVOICE will show customs agents that the parcel shipped from outside the EU with no VAT charge.

Rather than merely receiving the parcel as in the past, European customers will most likely receive a card, asking for payment of VAT at their own country's rate before the package can be delivered.

However, as avid Brexit "free trade deal" watchers will know, it might all change at the 11th hour. It looks as if Barnier and Frost are going to keep the suspense going right to the end.

Best wishes,
Graham

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps

Replies:

Posted By: Graham Slee
Date Posted: 05 Dec 2020 at 12:35pm

We're doing nothing about Brexit until it happens.

We will refund any wrongly paid VAT in the hours between Brexit (if it happens) and the update of our e-commerce (when we have had time to do all the work).

CE marking and declarations of compliance (available on request) will remain. Our PSU1 CB certificate, obtained within the EU, remains valid.

The UKCA mark means precisely the same as CE. In my opinion, it is a case of Parliamentary virtue signaling, or to frustrate the importation of goods from the EU or both. The display of the UKCA mark might be used to prevent the sale of British goods to EU member states.

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps

Posted By: Graham Slee
Date Posted: 21 Dec 2020 at 4:17pm

Latest

Shop site cart will close at midnight 31st December, and reopen once the new web pages have uploaded.

Any order placed from EU before midnight 31st December, but delivered after, VAT will be refunded and terms will be DDU - receiver pays VAT in own country on receipt.

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps

Posted By: Graham Slee
Date Posted: 31 Dec 2020 at 8:29pm

Update:

The shopping cart will be available from 11pm tonight.

VAT will only be charged on UK orders.

VAT will NOT be charged on orders from EU27 member states. Instead, the VAT will be payable to the courier who delivers your order. The amount of VAT will depend on the VAT rate in your country.

Therefore, the displayed UK VAT inclusive price will not be very different to the total cost of the received goods.

As before, orders from anywhere other than the UK and EU will not be charged VAT, and may incur import duty and local sales tax.

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps

Posted By: Graham Slee
Date Posted: 04 Jan 2021 at 3:51pm

And now, the f*ck up

https://www.bbc.co.uk/news/business-55530721 - https://www.bbc.co.uk/news/business-55530721

https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021 - https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

https://ec.europa.eu/taxation_customs/sites/taxation/files/vatecommerceexplanatory_28102020_en.pdf - https://ec.europa.eu/taxation_customs/sites/taxation/files/vatecommerceexplanatory_28102020_en.pdf

The things they never even discussed as part of their hoorah-henry supposed "free" trade deal.

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps

Posted By: Graham Slee
Date Posted: 04 Jan 2021 at 8:58pm

To our EU customers

Britains' split from the European Union (EU) on January 1st, 2021, means VAT is now charged when your order enters your country.

When you place your order our shopping cart automatically deducts the VAT and you pay us the net price (the price is divided by 1.2).

When your order lands in your country, our courier will ask you for the VAT at the rate ruling in your country.

Once paid, the courier will deliver your order.

We are trying to negotiate with our courier so that there is no extra handling charge, and will update you here when we know more.

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That none should be able to park up and enjoy the view without a smartphone and the knowledge in how to use apps