Importing from China

[Dan1]

Hi all,

I've identified a number of products which I would like to import from China, and was wondering what actually happens once the goods reach customs (I am not VAT registered).

Will they be impunded until I pay VAT ? or is that not an issue ?

Is there any required documentation ?

Also - does anyone know of a cheap shipping company ?

Regards

Dan

 

[art200380]

Dan

We started importing jewellery from China last month ready for our new online eccommerce website.

We have imported 4 different shipments, 3 with DHL and 1 with Fedex.

DHL insisted that we paid the VAT and duty before they released the goods, and we have paid both the delivery driver in cash, and by card at the DHL depot.

Fedex just released the goods and sent us an invoice for the VAT and duty about a week later.

Have a look on the HMRC website to see the duty rate for the goods you are importing.

Thanks

Andy

 

[Col66]

Import Duty (Not to be confused with VAT) varies for different types of product. Some products are zero rated whilst some might be 30%. I'm fairly sure that VAT is always charged at 20%.
The amount you pay will be determined by the Landed Value. This means that if you buy an item for £100 and pay £10 for the air freight then your taxes will be based on £110.

If you are charged an Import Duty of 20% (£132) plus VAT of 20% (£158.40) then you can see that the taxes add up!!

I'm not an expert but am reasonably sure of the above. However, definitely contact HMRC for the definitive answer.

Hope this helps!

Regards,

Colin.

 

[Col66]

Import Duty (Not to be confused with VAT) varies for different types of product. Some products are zero rated whilst some might be 30%. I'm fairly sure that VAT is always charged at 20%.
The amount you pay will be determined by the Landed Value. This means that if you buy an item for £100 and pay £10 for the air freight then your taxes will be based on £110.

If you are charged an Import Duty of 20% (£132) plus VAT of 20% (£158.40) then you can see that the taxes add up!!

I'm not an expert but am reasonably sure of the above. However, definitely contact HMRC for the definitive answer.

Hope this helps!

Regards,

Colin.

Sorry, I tried to edit this post but something went wrong!
What I was trying to say is this:

If you import an item that you pay £100 for and the Import Duty is rated at 20% + the landed value (freight charge) is £10 plus VAT @ 20% then you will pay the following:
£100 + (Import Duty) 20% = £120
Air Freight = £10
VAT = £130 + 20% = £156

I'm not an expert but am reasonably sure of the above. Definitely worth checking the HMRC website for the definitive answer!

Hope this clarifies my post!

Col.

 

[ReallyWildOne]

Can confirm what Col66 has just said.

Take the purchase price of the goods, add the duties charged (rates are different for different types of goods), add shipping costs. To this total, add VAT at 20%.

Best go with a shipping firm like Fedex which does all the work for you. I used a cheaper firm once, which ended up with goods being stuck in the Customs warehouse for over a month, by when the prices had dropped (was selling fast-moving electronics on eBay). So I ended up losing major money while trying to save a little on the shipping.

Also, if you're ordering from China for the first time, please be very very careful. See if you can arrange escrow; that is safest. Be suspicious of companies that do not agree to escrow payments. If, for some reason, escrow payment is not possible, keep your initial orders very small. Make sure you do your due diligence. Ask for customer referalls, search for comments online about the supplier and so on. It is very easy to get cheated in China.

Hope this helps.

 

[dantheman]

Although you do not need to be VAT registered if you are importing frequently you MUST get an EORI number (fancy new name for what basically was the old VAT number). Make sure you do this before the goods arrive as it usually takes 48-72 hours for customs to process your application & issue your EORI number.

Regards
Dan Jackaman
Operations Supervisor
WS Logistics (Procurus) Limited