Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

General cycling advice ( NOT technical ! )
Jdsk
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby Jdsk » 7 Jan 2021, 2:17pm

thelawnet wrote:MOSS is only for EU members.

What was (and is) the eligibility for the Non-Union VAT MOSS?

Thanks

Jonathan

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 7 Jan 2021, 4:16pm

Jdsk wrote:
thelawnet wrote:MOSS is only for EU members.

What was (and is) the eligibility for the Non-Union VAT MOSS?

Thanks

Jonathan


MOSS is for paying VAT on sales into the EU, previously this would be digital services as from July it would also be physical goods.

So a Chinese company charging for a digital service for someone in the EU can use MOSS.

It cannot and has not ever been used for paying VAT payable to any country other than EU members.

Clearly most countries in the world have either VAT or sales tax, but the particular issue here is that the UK followed EU rules on small and trivial value shipments and has continued to follow them after leaving the EU, yet cannot use the same system for payment because it is not an EU member.

I am not sure if this was a part of negotiations between the UK and the EU but it does make sense that the EU would want similar rules in the UK as in Europe

Jdsk
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby Jdsk » 7 Jan 2021, 4:24pm

thelawnet wrote:
Jdsk wrote:
thelawnet wrote:MOSS is only for EU members.

What was (and is) the eligibility for the Non-Union VAT MOSS?

MOSS is for paying VAT on sales into the EU, previously this would be digital services as from July it would also be physical goods.

So a Chinese company charging for a digital service for someone in the EU can use MOSS.

It cannot and has not ever been used for paying VAT payable to any country other than EU members.

Clearly most countries in the world have either VAT or sales tax, but the particular issue here is that the UK followed EU rules on small and trivial value shipments and has continued to follow them after leaving the EU, yet cannot use the same system for payment because it is not an EU member.

I am not sure if this was a part of negotiations between the UK and the EU but it does make sense that the EU would want similar rules in the UK as in Europe

Was the UK after Leaving able to join the Non-Union VAT MOSS?

Thanks

Jonathan

Jdsk
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Joined: 5 Mar 2019, 5:42pm

Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby Jdsk » 7 Jan 2021, 4:29pm

And the same but the other way...

"Customers in Europe hit by post-Brexit charges when buying from UK"
https://www.theguardian.com/politics/2021/jan/07/customers-europe-hit-by-post-brexit-charges-buying-from-uk

Jonathan

rualexander
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby rualexander » 7 Jan 2021, 5:12pm

An example of what may transpire once things settle down is the procedure for paying Duty and VAT charges on cycling clothing from NZ company Ground Effect.
Stuff ordered from them used to be subject to the usual business of getting a card through the door from the Royal Mail saying there's a customs charge to pay and their £8 handling fee.
But for the past couple of years or so they have been selling to the UK with Duty and VAT prepaid.
I don't know if this will change now with the latest regs. though but hopefully not.

Screenshot_20210107-170451.png

thirdcrank
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thirdcrank » 7 Jan 2021, 5:39pm

Not a bike firm but I've bought a couple of flat caps - importing flat caps from Germany to Yorkshire? you may ask - from a German firm with a registered office in the UK. Payment is in £ to the UK subsidiary but the togs are then imported, hassle-free.

https://hatshopping.co.uk/Shipping-information.html

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 7 Jan 2021, 6:18pm

Jdsk wrote:
thelawnet wrote:
Jdsk wrote:What was (and is) the eligibility for the Non-Union VAT MOSS?

MOSS is for paying VAT on sales into the EU, previously this would be digital services as from July it would also be physical goods.

So a Chinese company charging for a digital service for someone in the EU can use MOSS.

It cannot and has not ever been used for paying VAT payable to any country other than EU members.

Clearly most countries in the world have either VAT or sales tax, but the particular issue here is that the UK followed EU rules on small and trivial value shipments and has continued to follow them after leaving the EU, yet cannot use the same system for payment because it is not an EU member.

I am not sure if this was a part of negotiations between the UK and the EU but it does make sense that the EU would want similar rules in the UK as in Europe

Was the UK after Leaving able to join the Non-Union VAT MOSS?


That question doesn't make sense.

MOSS refers to a VAT registration/return in one EU country for VAT due to all 27.

Non-Union MOSS refers to a registration by a company which has no offices in the EU but which wishes to supply EU customers with digital services, which case they can choose any of the 27 countries for their single registraton.

Union MOSS is almost identical but is for a company which does have an office in the EU.

Prior to Brexit you could pay French VAT due on digital services provided to French customers via a UK registration.

Obviously post-Brexit, that's not possible as the UK is no longer in the EU, so you might now run your MOSS via, say, Luxembourg.

Currently:

1. UK goods sent to the EU should be sold without VAT, and VAT collected by customs in the recipient country. From July the UK seller will instead charge the correct EU VAT for sales below €150 via OSS
2. EU goods sent to the UK should be sold with UK VAT below £135, and the EU seller should register for UK VAT in this case. Above £135 VAT should instead be collected on import.

1 would have happened anyway in July in that British companies wanting to sell to Europe would have had to cater for 27 sets of VAT rules and charge them appropriately depending on the customer's delivery address.

2 would also have happened in July but the VAT would have been payable/reportable via OSS, whereas now it must be reported to the UK instead.

The £135/€150 limit above which VAT is payable on import would not apply if Britain remained in the EU - in that case foreign VAT would always have been charged at the time of sale regardless of the value.

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 7 Jan 2021, 6:35pm

thirdcrank wrote:
thelawnet wrote:
wheelyhappy99 wrote:A few days ago I posted information I received from a small Dutch training company which set out that they will no longer supply me with books because the UK government decided to withdraw from.the MOSS VAT agreement, as I understand it used by both EU member states and non member states. Basically too costly to register for UK VAT and too much hassle.
.


Not true.

MOSS is only for EU members. The separate registration is a necessary function of the UK being outside the EU.


Whether it's true or not doesn't alter things a teeny-weeny bit if it's what's happening in real life.


Er, if it's not true, and it's definitely not true at all, it is not what's happening in real life.

Taxes are paid to states. MOSS can only only used by states that are members of the EU. Never at any point states that are not member of the EU.

Companies that had no physical presence in the EU were told by the EU that actually they were doing business in the EU, and needed to pay tax in the EU, because they were providing digital services on the internet to people living in the EU. These foreign companies were told by the EU that they either had a choice of registering for VAT in each EU state or making one registration in one state and paying there to all 27 members.

This idea of charging VAT on digital services from foreign companies was not first implemented by the EU but in fact Norway.... Which is not in the EU, and therefore does not use MOSS. It requires companies to register there and pay them there. The EU system followed 4 years after Norway. They are entirely independent and separate systems.

As far as goods goes Australia already requires foreign companies selling into there to register for GST

https://www.ato.gov.au/business/interna ... residents/

As does New Zealand ....

https://www.consumer.org.nz/articles/gs ... e-shopping

rualexander
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby rualexander » 7 Jan 2021, 7:34pm

thelawnet wrote:.

As far as goods goes Australia already requires foreign companies selling into there to register for GST

https://www.ato.gov.au/business/interna ... residents/

As does New Zealand ....

https://www.consumer.org.nz/articles/gs ... e-shopping


Ah interesting. I notice there is a turnover threshold below which complying with their scheme is not necessary though.
Also no mention of a charge just to register with the tax authority as an overseas seller?

wheelyhappy99
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby wheelyhappy99 » 7 Jan 2021, 7:54pm

See below the text I received from the Dutch company:
It's unlikely we will be able to ship books to the UK after 1st of January. Unlike other countries outside the EU, the UK requires our company to register for the British VAT in order to be able to ship goods from a commercial organisation.
I'm not a VAT expert, but assume the company owner knows his business.

I suspect most users of this site aren't particularly interested in the details of VAT regs. They might, though, think it's useful to know that the withdrawal of UK sales by EU based suppliers doesn't appear to be because of teething problems, but a long term change.

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 7 Jan 2021, 8:47pm

rualexander wrote:
thelawnet wrote:.

As far as goods goes Australia already requires foreign companies selling into there to register for GST

https://www.ato.gov.au/business/interna ... residents/

As does New Zealand ....

https://www.consumer.org.nz/articles/gs ... e-shopping


Ah interesting. I notice there is a turnover threshold below which complying with their scheme is not necessary though.
Also no mention of a charge just to register with the tax authority as an overseas seller?


As I understand it, the Swiss were persuaded to eliminate their threshold by the EU. I imagine that the UK is complying with this approach.

You wouldn't be charged just to register, but of course there will be in the real world staffing/admin costs associated with each extra tax registration you require for each extra country.

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 7 Jan 2021, 9:10pm

wheelyhappy99 wrote:See below the text I received from the Dutch company:
It's unlikely we will be able to ship books to the UK after 1st of January. Unlike other countries outside the EU, the UK requires our company to register for the British VAT in order to be able to ship goods from a commercial organisation.
I'm not a VAT expert, but assume the company owner knows his business.

I suspect most users of this site aren't particularly interested in the details of VAT regs. They might, though, think it's useful to know that the withdrawal of UK sales by EU based suppliers doesn't appear to be because of teething problems, but a long term change.


Except that it is teething problems in that any seller can choose to sell to the UK without UK VAT registration by setting a £135.01 minimum order threshold (before shipping). In this case the UK would be exactly the same as an other country outside the EU.

Furthermore, some companies that are not currently UK VAT registered will decide to do so. This would also fall into 'teething problems', in that the fact that it is not currently possible to place an order does not mean that it will always be impossible for all companies currently affected.

It is reasonable to argue that the £0.01 registration threshold is burdensome for companies with a small amount of business to the UK, but there doesn't seem to be any reason why they would not want to accept orders over the £135 threshold, assuming that they are happy to process orders to other non-EU countries.

rualexander
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby rualexander » 7 Jan 2021, 9:26pm

thelawnet wrote:
rualexander wrote:
thelawnet wrote:.

As far as goods goes Australia already requires foreign companies selling into there to register for GST

https://www.ato.gov.au/business/interna ... residents/

As does New Zealand ....

https://www.consumer.org.nz/articles/gs ... e-shopping


Ah interesting. I notice there is a turnover threshold below which complying with their scheme is not necessary though.
Also no mention of a charge just to register with the tax authority as an overseas seller?



You wouldn't be charged just to register, but of course there will be in the real world staffing/admin costs associated with each extra tax registration you require for each extra country.


But the information from the Dutch company at the start of all this was that the HMRC require them to pay a registration fee for the privilege of collecting UK taxes on behalf of HMRC.

thelawnet
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby thelawnet » 8 Jan 2021, 10:59am

rualexander wrote:
thelawnet wrote:
rualexander wrote:
Ah interesting. I notice there is a turnover threshold below which complying with their scheme is not necessary though.
Also no mention of a charge just to register with the tax authority as an overseas seller?



You wouldn't be charged just to register, but of course there will be in the real world staffing/admin costs associated with each extra tax registration you require for each extra country.


But the information from the Dutch company at the start of all this was that the HMRC require them to pay a registration fee for the privilege of collecting UK taxes on behalf of HMRC.


This is not true though. There is no such fee. Anyone claiming that the government charges a fee for VAT registration is a scammer.

And it's not really a privilege.

Ultimately most countries will have tax treaties with the UK which makes this entirely legal and no different in law from charging VAT to their domestic customers.

It might be that from certain jurisdictions there are no such treaties and the foreign seller can ignore this

But in general foreign taxes being exchanged between countries is nothing unusual, and the suggestion that there is some sort of right to ignore this is wrong....

rualexander
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Re: Post-Brexit - buying bike parts abroad . . (incl. Rose/DutchBikeParts)

Postby rualexander » 8 Jan 2021, 11:24am

thelawnet wrote:
This is not true though. There is no such fee. Anyone claiming that the government charges a fee for VAT registration is a scammer.

...


So this from the Dutch Bike Bits is incorrect?
Ok it doesn't explicitly say the fee is to register for VAT, but it says they will be charged by HMRC to collect the applicable taxes.

".....by the British government deciding to impose a unique taxation regime which will require every company in the world in every country in the world outside the UK which exports to the UK to apply and collect British taxes on behalf of the British government. For providing this service they intend to charge a fee to every company in the world in every country in the world which exports to the UK. Clearly this is ludicrous for one country, but imagine if every country in the world had the same idea. If every country decided to behave in the same way then we would have to pay 195 fees every year, keep up with the changes in taxation law for 195 different countries, keep accounts on behalf of 195 different countries and submit payments to 195 tax offices in 195 different countries, and jump through whatever hoops were required to prove that we were doing all of this honestly and without any error."