Importing from China

Discussion in 'International Business' started by Karan1, Oct 12, 2019.

  1. Karan1

    Karan1 UKBF Newcomer Free Member

    2 0
    I’m staring out and thinking about importing from China.

    I have some questions.
    I have got an EORI number. I assume I also need to register for a VAT number?
    Also, is it advisable to use a freight carrier or do it myself? If I do it myself, what additional things do I need to do?

    Once my goods are here. I sell them. Do I need to pay taxes on this too? What taxes? Tax on profit? Anything else? I’m trying to work out if this is worth while.

    At what point do tell HMRC?

    Thank you.
    Posted: Oct 12, 2019 By: Karan1 Member since: Oct 12, 2019
  2. Tom Gardner

    Tom Gardner UKBF Contributor Free Member

    56 3
    Posted: Oct 13, 2019 at 12:17 PM By: Tom Gardner Member since: Dec 9, 2017
  3. Mike Foulds

    Mike Foulds UKBF Newcomer Free Member

    29 9
    Just to add to the above good/correct advice.

    For importing, I would definitely suggest going through a freight forwarder, they should have accounts with most shipping lines, hauliers, etc, and be able to get you better rates than you would be able to directly, as they handle larger volumes.

    For payment, you will pay any duty/vat applicable on arrival of the cargo in a UK port/airport, and most companies will ask for full payment of this prior to release/delivery of the cargo.

    Hope that helps.
    Posted: Oct 14, 2019 at 8:35 AM By: Mike Foulds Member since: Mar 21, 2018
  4. consultant

    consultant Your Business Community Staff Member

    5,456 754
    I would also suggest you speak to an accountant.

    You should understand all of the ramifications of importing and selling before starting out, otherwise you will meet the fate of too many others....
    Posted: Oct 14, 2019 at 11:51 AM By: consultant Member since: Jan 21, 2008
  5. Mr D

    Mr D UKBF Legend Free Member

    16,755 1,871
    If you register for VAT then you'd charge your buyers VAT on relevant sales and collect the money for HMRC as an unpaid tax collector.
    Until you reach the VAT threshold or store stock in a foreign country you don't need to register for VAT.

    If you don't register for VAT then you don't charge your customers VAT.

    If your business is a sole trader then you pay personal taxes on profits at personal tax rates. The profit is your income.
    If your business is a limited company then the company pays corporation tax on its profits.
    Posted: Oct 14, 2019 at 12:00 PM By: Mr D Member since: Feb 12, 2017

    QPLAST UKBF Contributor Free Member

    34 5
    You definitely need to pay hmrc either way. Corporation tax or personal income tax on profit.

    If you register for vat, then you collect the vat from your customer and pay the difference ( of what you have paid during the import). If you are not registered, then you can't collect vat from your customer and the vat paid during the import is your additional cost/duty.

    You must discuss with a qualified accountant from the same field to avoid unnecessary notices from hmrc.

    All the best,

    Cheer's, Deepak
    Posted: Oct 16, 2019 at 1:13 AM By: QPLAST Member since: Aug 22, 2018
  7. Karan1

    Karan1 UKBF Newcomer Free Member

    2 0
    Thank you. This is all very useful
    Posted: Oct 16, 2019 at 10:56 PM By: Karan1 Member since: Oct 12, 2019

    CHUKTC UKBF Contributor Free Member

    99 14
    I think the tax implications and registering with HMRC are well covered by the above contributers.
    Regarding freight it partly depends on what you are shipping, and how much. For small quantities you may chose to ship by air as the best option. For larger quantities a part container load (LCL) may be the best option. This is where you need to be very careful. Many sellers in China will offer 'free shipping' or very low cost. You need to be aware of this and avoid at all costs. You will be liable to pay all port costs on arrival, customs clearance and onward delivery. You wont know the port costs until the goods arrived and the cost is stacked high by the seller to pay for shipping! Fr LCL therefore you need to arrange the shipping yourself and most people will use a freight forwarder for this. If UK based they should be able to quote you a price delivered to your door.

    For full containers its a little more transparent but generally you will get better rates if you buy the goods FOB and then shop around and arrange shipping yourself.

    If you need help with any of this let me know - we do this everyday of the week! The other thing you should consider is which suppliers to use - careful choice is important to get the right quality and the best price.
    Posted: Oct 18, 2019 at 10:07 AM By: CHUKTC Member since: Jan 2, 2019
  9. paulears

    paulears UKBF Big Shot Full Member

    3,961 981
    If you have an EORI number, then HMRC have you tagged as a business already - so you need to register with them properly. The date on your EORI will need to match of course!
    Posted: Oct 19, 2019 at 10:21 AM By: paulears Member since: Jan 7, 2015