The Wholesale Forums

[studio1one]

a couple of my suppliers have marked down the invoice price on samples I ordered.

I didn't ask them to do it, they took it upon themselves, I guess they thought they were being helpful.

Whats my best course of action? should I give HMRC a call and let them know whats happened?

Legally it is your responsibility to inform HMRC that you need to pay tax (if applicable) on an item you have received. I am well aware however that many do not do this.

I would certainly make sure that for future orders, which perhaps are larger, they don't mark them down.

[markcrook]

If the value is below the value that you actually paid then it would be wise to inform HMRC. Under the rules UK customs use you should pay duty on the actual price you paid for the goods.

[studio1one]

I think I'll give them a call and sort it out, don't want a wonky balance sheet.

[rowlystravel]

no tax on samples anyway mate. i got his info from HMRC on email!

[studio1one]

hmmm I'm pretty sure that's only if they are of nominal value, I wait to be corrected on that by someone more experienced at import. As I understood it if your samples have commercial value they are treated as any other imported goods.

[greedyboy]

There is tax on samples as with any goods. You can mark goods as 'no commercial value' which is the equivalent samples. They are still taxable. despite having no commercial value you still have to declare their actual cost/value.

If you import samples there is a form you need to complete (can't remember off hand the actual name) which declares that the goods will not be sold on (again back to 'no commercial value) but it is more hassle than it's worth.

Dean as you are a genuine commercial business, 1) declare the true value (as you and I know you can reclaim the VAT and the remainder cost is very small and 2) see an accountant who deals with importers).

[nicola]

Samples should not have been marked down on invoice in the first place. I suggest in future you make sure your supplier doesnt do this. (As other viewer said)

[studio1one]

I fully intend to declare the full value as otherwise my balance sheet will be screwy and nothing infuriates the revenue more than a screwy balance sheet and an infuriated VAT man is the last thing I want on my tail. Not only that but you can't track your own profit and loss accurately if the figures in your books don't show an accurate representation of how much you've spent and earnt.

[nicola]

Originally Posted by studio1one

I fully intend to declare the full value as otherwise my balance sheet will be screwy and nothing infuriates the revenue more than a screwy balance sheet and an infuriated VAT man is the last thing I want on my tail. Not only that but you can't track your own profit and loss accurately if the figures in your books don't show an accurate representation of how much you've spent and earnt.

If these samples are being given to you and you are not paying for them, you wont pay anything. So why would you want to pay tax. The only time you pay tax is if you are buying them. Your supplier has probably just jotted down the price because obviously you need to know it. If you are paying for your samples then you do pay tax.