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      russmb


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      Post #77366, posted on 01-12-2021 GMT-5 hours    
      Fellow modellers,

      It is with heavy heart that I have decided, effective immediately, to halt all sales to customers in the United Kingdom.

      I have taken this rather drastic decision as a direct consequence of the implementation of a requirement by Her Majesty's Revenue & Customs that if I make even one sale for $1, I must register with HMRC, collect 20% VAT, and file quarterly VAT returns.

      If my UK customers would like to read up on this, see

      https://www.gov.uk/government/publications/vat-notice-7001-should-i-be-registered-for-vat/vat-notice-7001-should-i-be-registered-for-vat#non-established-taxable-persons-netps-basic-information

      Under this law, I am considered a "NETP" (Non Established Taxable Person), and, according to section 8.3,

      If you make any taxable supplies (see paragraph 2.3) in the UK, you must:

      register for VAT in the UK
      account for UK VAT to HMRC

      The law requires that I include my VAT number on the electronic customs declaration, and if I do not, any package sent to a UK address can be returned or destroyed.

      The UK is the ONLY country in the world that I am aware of that does not have a reasonable "minimum sales threshold". For a small one-person business such as AHS, the burden of collecting, accounting and filing such tax returns becomes unreasonable. Did you know in the U.S. there are over 11,000 taxing jurisdictions? Fortunately all U.S. states have set reasonable thresholds below which I am exempt. Australia also imposes a taxing requirement on offshore businesses, but with a minimum AU$ that I am never going to come close to meeting.

      At such time as the UK takes steps to lessen this requirement, I will, of course, reconsider.

      Thanks!

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      Andrew


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      Post #77368, posted on 01-12-2021 GMT-5 hours    
      Well sorry to hear that Russell

      It's unfortunate the UK Gov has become so draconian.
      Hopefully this does not affect your company in a big way.

      I suspect going forward with Government overspending money they don't have we will see more of this in the future.

      Of course this will lead to many new ideas about work arounds like shipping to a friend and them forwarding a gift....

      Cheers
      Andrew
      CYYZ

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      gavmh


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      Post #77369, posted on 01-12-2021 GMT-5 hours    
      Hi Russell,

      Thank you very much for this information. I was not aware of this until now. Can any one, probably from the UK, let us know how much this VAT is in percentage?

      Kurt

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      Speedbird269


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      Post #77370, posted on 01-12-2021 GMT-5 hours    
      Currently UK VAT on items such as models and decals is 20%. This is an insane process that our tax authorities have come up with as the HMRC can barely keep on top of our over complex domestic taxation system and its enforcement.

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      VFD


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      Post #77371, posted on 01-12-2021 GMT-5 hours    
      I just found this information on the esellercafe website:

      BREXIT is changing how the UK is managing VAT and now it has placed the burden of collecting VAT on small orders (those under £135 or about $180) on non-UK based merchants

      I agree with Russell, this is ridiculous.

      Mike

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      Speedbird269


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      Post #77376, posted on 01-12-2021 GMT-5 hours    
      Sadly I suspect the UK Government has woken up to the massive amounts of 'low valued'goods coming into the UK particularly from China, direct to individuals .A well known trading website being the chief facilitator.The Post Office and couriers used to collect tax based on declared value. This was always a bit hit and miss. But in recent years they have virtually given up as the system was overwhelmed. Unfortunately to fix the problem HMRC have pushed the onus onto the seller , with the buyer at risk of not getting the goods if the seller doesn't comply. I'm reading reports of multiple traders across a spectrum of businesses suspending trading with UK buyers. I don't think the intention was to catch cottage industry , but those who are shipping to the UK on an industrial scale , deliberately bypassing the tax system, with dubious value declarations.

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      dave6376


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      Post #77377, posted on 01-12-2021 GMT-5 hours    
      It's not really a case of the UK government waking up to anything. This scheme was dreamt up by the EU to counter large-scale VAT evasion. The UK have started it early because we left the EU customs union on 31 December and it was presumably deemed "sensible" to make the change along with everything else from 1 January.

      The scheme or something very like it is going to be rolled out across the whole EU in the summer, I think in July.

      It is disappointing that Russell and other sellers have pulled the plug completely on UK sales rather than setting a minimum UK sale limit of £135/€150 or USD equivalent. Over that level the current procedure remains in force - the seller completes a customs declaration and the UK Post Office collects what's due from the purchaser.

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      Andrew


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      Post #77380, posted on 01-12-2021 GMT-5 hours    
      Either way it is ridiculous a level of red tape stifling small business.

      So they will just tax you to death!

      Thats why we have a large cash economy and funnelling of money into tax havens. Definitely a bad recipe which looks the same in most western countries.

      Cheers
      Andrew
      CYYZ

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      gavmh


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      Post #77384, posted on 01-13-2021 GMT-5 hours    
      Hi David,

      Is it true that I will not have to pay VAT for parcels with values above 150,00€? If yes, where can I find and verify this regulation?

      Kurt

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      Speedbird269


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      Post #77386, posted on 01-13-2021 GMT-5 hours    
      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

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      russmb


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      Post #77394, posted on 01-14-2021 GMT-5 hours    
      Well... 1:40 am here in Phoenix, and I just got off the phone with a very helpful lady at HMRC. There is good news and bad news.

      First, she directed me to the following HMRC VAT Bulletin:

      https://www.gov.uk/guidance/vat-and-overseas-goods-sold-directly-to-customers-in-the-uk

      It would appear that orders valued at £135 or more before postage are exempt from the seller having to collect VAT. It is orders under £135 before postage and insurance that the seller (i.e. AHS) must, effective Jan 1st 2021, register for and collect 20% VAT, then file quarterly VAT returns with HMRC.

      As I said previously, the workload impact is simply not worth the time I will have to spend complying with these regulations.

      However, I am willing to work within the regulations.... so the good news is that I will accept orders from the U.K. that are $200 or more, before shipping (£135 at current exchange rate is $184, so rounding up to allow for currency exchange fluctuations).

      The bad news is that my estore has no ability to enforce a minimum order only to customers in certain countries. I can set a store wide minimum, but not by country.

      To draw attention to this, the shipping countries for the UK have been changed to “BREXIT – ENGLAND”, “BREXIT – NORTHERN IRELAND”, “BREXIT – SCOTLAND” and “BREXIT – WALES”. No worries, I manually create shipping labels, “BREXIT” will not appear on them!

      Finally, and obviously, orders from customers in the U.K. and under $200 will be cancelled, and I will communicate with the customer via email explaining the issue.
      Thanks to all here, and on AMD who have posted comments that have helped me figure this out.

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      Post #77439, posted on 01-19-2021 GMT-5 hours    
      Hi Russ
      I feel so sorry for you that UK Brexit red tape has forced this decision on you.
      I have enjoyed great service from you over the years and will miss the easy access you provide to decals and kits that are often hard to find here in the UK.
      Having glanced at the rules, it would appear that 'online marketplaces' are responsible for collecting VAT (instead of the seller) if you sell through them.
      Would an 'AHS Ebay Shop' or similar be a way of re-opening AHS to us modellers in the UK?
      Just a thought.
      Cheers and best wishes
      TIM

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      Jon


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      Post #77440, posted on 01-19-2021 GMT-5 hours    
      This is insane!!!

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      Jennings


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      Post #77447, posted on 01-19-2021 GMT-5 hours    
      It seems to me that we settled this whole “taxation without representation” thing with the UK when, in 1783, General Washington opened up a big fat can of genuine Yankee whoop a** on Lord Cornwallis at a little place called Yorktown. Her Imperial Majesty can kiss my Yankee butt.

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      Ken Miller


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      Post #77449, posted on 01-20-2021 GMT-5 hours    
      Problem here is two countries/citizens doing business and the government taxing. Big difference from taxation without representation issue.

      Sad that the UK has "ramped up" collection of VAT but what are you going to do?

      I'm Scottish by birth but have lived in the US for most of my life so think I have a little more knowledge on the US/UK culture differences and similarities. I've always thought VAT was high compared to US taxes. A personal peeve is the required UK license/tax for TV and mobile phones. I would think people in the UK would vote it away but it hasn't happened yet.

      Ken


      quote]Jennings :
      It seems to me that we settled this whole “taxation without representation” thing with the UK when, in 1783, General Washington opened up a big fat can of genuine Yankee whoop a** on Lord Cornwallis at a little place called Yorktown. Her Imperial Majesty can kiss my Yankee butt.


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      Post #77468, posted on 01-22-2021 GMT-5 hours    
      Every other developed country on earth has higher taxes than the US, and every one of them has a much better social safety net and other "socialist" things that benefit all of their citizens. "Tax" in the US is a four-letter word.

      Her majesty can still kiss my grits.