import duty and vat quick quest

3701 · 08-01-2008, 10:09 AM

hi guys i just found out the products im purchasing from china have 2.3% duty.

am i right in thinking when they get over to the uk i will be charged 17.5% for vat + 2.3% duty on the whole cost i.e. the cost of the product + shipping

its costing me $250 for the products
and $550 for shipping - $800 in total

so i will be charged a total of 19.8% of $800 =$158.40

thanks guys
ant

DSC · 08-01-2008, 10:18 AM

You take your total amount $800 and HMRC publishes exchange rates which for this week the rate is 2.0034 for USD =£399.32.

£399.32 + 2.3% duty= £408.50
£408.50 + 17.5% VAT= £479.99

Duty + VAT= £80.67

Then you will have a customs clearence fee of c£15

Last edited by DSC; 08-01-2008 at 10:21 AM.

**ukseller1** · 08-01-2008, 02:40 PM

What??? I didn't know you had to pay vat on the delivery price?????

Thats insane!

D M · 08-01-2008, 06:06 PM

Insane to who?

If you were a British factory owner who had to pay VAT on delivery charges all the way up the manufacturing chain, i'm sure you wouldn't find it insane.

**ukseller1** · 08-01-2008, 07:04 PM

I didn't realise VAT was charged on the delivery price, that certainly lowers my profit margins now.

3701 · 08-01-2008, 10:57 PM

cheers dm for the answer!

yeh guys believe it u get charged on your DELIVERY! so recalculate before u order!!! :niceone:

is the custom clearence standard charge all the time?

Quote:

Originally Posted by DSC

You take your total amount $800 and HMRC publishes exchange rates which for this week the rate is 2.0034 for USD =£399.32.

£399.32 + 2.3% duty= £408.50
£408.50 + 17.5% VAT= £479.99

Duty + VAT= £80.67

Then you will have a customs clearence fee of c£15

D M · 08-01-2008, 11:01 PM

It was DSC who gave the answer!

Clearence fee depends on the courier.

**greedyboy** · 08-01-2008, 11:11 PM

Halayula for VAT registration

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studio1one · 08-01-2008, 11:13 PM

Quote:

Originally Posted by greedyboy

Halayula for VAT registration

yeah, like you say that at the end of every quarter.

Actually its not such a big hit in the import business I have found. In the restaurant trade ita an absolute killer, give a quarter of your turnover and have virtually none to reclaim. I end up paying over 13% of my gross turnover to the VAT man because my biggest cost is raw food items which are of course zero rated.

**greedyboy** · 08-01-2008, 11:18 PM

I actually love having a massive VAT bill, it means I made lots of money!

As for importing, either make a nice big order the final month of your quarter and file the C.I. and your freight forwarding invoice/charges. Better still, get a deferment account.

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Last edited by greedyboy; 08-01-2008 at 11:22 PM.