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Posted Thu, 17 Aug 2023 13:31:17 GMT by Z K
Hello, I hope someone will be able to help me understand how import for EU when my business in not VAT registered. Information: I plan to import goods from EU to sell them in UK (sofas) I'm running a limited comany which is not VAT registered. I've applied for EORI number Question: How to approach it? What would be the VAT arrangement? In country of origin (Italy) they have a 22% vat rate. Lets say I buy a sofa which costs me £1000+vat. Do I pay the VAT twice? once in country of origin and second time the VAT in the UK?
Posted Fri, 18 Aug 2023 17:17:13 GMT by Customs oldtimer
It depends on what terms you have agreed with your supplier. Your supplier should not charge you Italian VAT if they export the goods to you . they can zero rate the export provided they have proof of export. It is however up to the supplier to make the judgment that they are entitled to zero rate. If on the other hand you are collecting the goods then it’s likely that will change VAT as they will not have control of the export. As you are not VAT registered you will need to pay import VAT on entry to the UK. This will be based on the goods value that is what you paid plus any cost of transport .
Posted Fri, 18 Aug 2023 19:44:36 GMT by Z K
Thank you. I have two potential suppliers and one said that as the goods are leaving EU he can issue 0%VAT invoice, and all he needs to be able to do is IE599 export notification confirming goods left EU, and the other saying they need to apply the VAT even though the goods are leaving EU. I managed to ask business in other EU country that exports to the UK and it seems issuing invoice with 0% VAT and IE599 issued by customs agent is what is needed. It is all very confusing. I can't understand why there is no EU procedure which explains exactly how to approach it.
Posted Mon, 21 Aug 2023 08:32:25 GMT by sunil makim
Hello Z K Best way to avoid VAT Issues is to agree terms with Italian supplier , where they treat it as an export and dont charge you Italian Vat . Once the goods arrive at the UK Border , you have no choice but to pay the VAT if goods are for sale or personal use.which will become part of the cost of goods ( Italian supplier invoice plus UK VAT ) . Simple process at UK border is Customs agent completes the Import Declaration based on invoice and delivery terms .
Posted Mon, 21 Aug 2023 11:27:08 GMT by Customs oldtimer
Hi ZK VAT is complex . There is EU VAT legislation that sets out the basic principles however it is up to each EU member state how that is implemented. Thus there is the basic principle that local VAT isn’t charged or zero rated if the goods are exported However, zero rating may only apply if the seller can prove that they are the exporter of the goods and that the goods have actually been exported from the EU. The proof a seller needs to provide to their tax authorities may vary. You mentioned IE599 but that is specific to Poland to my knowledge - other countries will have different requirements. If the seller doesn’t get the proof they still have to account for that VAT . Therefore If they are not the exporter , don’t have or don’t think they can get the required proof then they are quite within their rights to charge the VAT.
Posted Wed, 23 Aug 2023 11:42:48 GMT by HMRC Admin 20
Hi KZ,

The trader will have to pay customs charges due as per tariff, they need to speak to exporter or customs/tax authority of exporting country to see if they can zero rate the sales VAT because goods will be subject to import VAT as per tariff in UK.
If the importer is not VAT registered in UK then it is not possible to claim back the import VAT.
Please see step by step guide on importing goods into UK on below link:
Import goods into the UK: step by step

Thank you.
Posted Wed, 23 Aug 2023 12:12:22 GMT by Z K
Thank you Customs Oldtimer and HMRC Admin 20. I have talked to the supplier in Italy and it looks like they will be able to invoice me with 0% VAT rate after all.

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