Importing & VAT advice

[mobile_mad]

Hi, i'm thinking of getting out of the rat race and starting up my own online business selling mobile electronics such as new /used Laptops, Mobile phones, PDA's e.t.c.
I need some advice on importing. I've downloaded lots of .pdf customs notices from the goverment sites regarding importing, but i think that they are geared towards large freight importing and all the form filling that that entails.
I've contacted some suppliers but they all ask for a FedEx or DHL account number. I did some research into this, and found that they'll take care of all the customs procedures for you, and bill you via your bank account attached to the FedEx/ DHL account number, but do they deliver the goods to your door? or do you have to get your own transport to collect your goods from the customs warehouse/ port? What's your experience been when it comes to importing via FedEX/ DHL?
Also, what's the deal when it comes to VAT? I notice that on the application forms for FedEX / DHL accounts, there is a box to enter your VAT Number. Will i have to apply for a VAT No. via the Inland Revenue? or will i pay VAT on my imports at the port, then pass the cost onto my customers? Will i still have to register for VAT if i sell goods online, either through an eBay shop or on my own webpage? is it possible to get round VAT if selling online?! what's the procedure for paying VAT via your VAT number?

Any help will be most appreciated. I don't mind if you posts are long as i need as much info as possible!!

Thanks.

Andy

 

[gary]

Have a look at these two posts:

http://www.ukbusinessforums.co.uk/viewtopic.php?t=1640

http://www.ukbusinessforums.co.uk/viewtopic.php?t=2024

They may be of some help.

Gary

 

[mobile_mad]

Yes, the first links is especially helpful, as user 'momtrepreneur' mentions that FedEx/ DHL will deliver the goods to your door so that's one worry out of the way, although later on the original poster (furman) says he wants the goods collected via a freight fowarder? - i thought that's what you pay FedEx/ DHL to do?!

In terms of the VAT issue, The VAT number you provide FedEx/ DHL is used to pay VAT on the import so i'll have to pass this cost onto my customers. Does this also mean i'll have to do my own Tax returns (self assesment)?

Almost there...!
Andy

 

[Ozzy]

Hi Andy,
You will be sent a VAT import certificate from HMC&E which you use to reclaim paid VAT when doing your VAT return.
How you do this is one area I'm note 100% certain on so hopefully one of the finance related folks on here will jump in!

 

[gj]

Effectively when you pay VAT on import, it is just like having paid VAT to the supplier if you had bought it in the UK.

You recover the VAT in the usual way via the vat return.

Just to clarify - VAT is handled by Customs & Excise and Income Tax and Corporation Tax are dealt with by the Inland Revenue.

They are separate issues. If you are trading on your own account, you should also register as self employed with the Inland Revenue - go to www.ir.gov.uk and click on registering as self employed.

Note that if you are selling to the public or businesses that are not VAT registered, it could be beneficial to delay your VAT registration until your turnover exceeds the VAT registration limit, even though you will suffer the VAT on import.

You will have to do a self assessment tax return if you are self employed or if you are a director of your own limited company.

HTH

Graham

 

[mobile_mad]

I see, i am considering registering as a sole-partnership, but i may want to rope my brother in, as he is being made redundant in a few months. Will i then have to re-register as a partnership instead? or can i just pay him a wage/ split profits with him, without him registering himself with the Inland Revenue?
Regarding VAT, is the self-assessment form easy to fill out? what if i haven't made much profit e.g below £5000 before the first self-assessment form is issued?

I'm planning to sell the goods either via eBay or through a webpage so i'll be dealing with the public rather than supplying to other businesses. I just need to work out how much VAT, duty and delivery charges will dent my profits, as i don't want to mark-up the goods too high because of competition from the high street stores, other eBay users e.t.c.

Also, when my USA based supplier sends out the goods to me, are they responsible for the correct Commodity Code, or do i suggest one to them, or does DHL/ FedEx handle all this side of things (i just pay using the DDU service on the door).

Cheers,
Andy.