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Posted Tue, 22 Feb 2022 22:45:39 GMT by turbopodge
I'm a sole trader building musical instrument accessories in the UK. I'd like to take a number of these products to some small-scale trade and consumer shows in the EU, both to exhibit and sell. I notice the carnet option does not permit me to sell products directly, so that's not ideal. However an alternative might be to use the rules for "Commercial goods in your accompanied baggage, also known as Merchandise in Baggage" (quoting the gov website). Now this has a value cap of £1500, which if I went by the retail price to the end user would only allow me to take 10 or so items, which isn't good. However the Simple Online Declaration (see below) specifically asks for the amount I paid for the items and uses this as the declared value. Since I build/manufacture the items myself from components the amount I pay for parts is a fraction of the retail price. Therefore I should be able to take a decent number of items to sell. Is my interpretation of this correct? Another thought: would it be acceptable to import part-assembled products, declaring the component value, then assemble them once in the EU to form a saleable item?
Posted Sun, 27 Feb 2022 12:04:05 GMT by turbopodge
Can someone please let me know how Merchandise in Baggage works. I'm booked for a guitar show in Manheim in September and am considering one in Berlin in March. I want to know if selling products in the EU is feasible after brexit.
Posted Mon, 28 Feb 2022 12:53:04 GMT by HMRC Admin 17

Use this service to declare goods (simple):

that have a total value of £1,500 or less
that weigh a total of 1,000 kilograms or less
not subject to excise duty (alcohol, tobacco, fuel)
in your accompanied baggage or in a goods vehicle including a van
that are not controlled goods or restricted goods    

Providing the above requirements are met, multiple items can be declared:

Declare commercial goods you’re taking out of Great Britain in your accompanied baggage or small vehicles   . 

Thank you.                              
Posted Mon, 28 Feb 2022 12:58:10 GMT by turbopodge
This is no help at all. You've just copied and pasted from the page I linked. Can you answer my question about declaring the value of goods please.
Posted Mon, 28 Feb 2022 15:17:28 GMT by HMRC Admin 2

You can find guidance here:

Taking commercial goods out of Great Britain in your baggage

Thank you.
Posted Mon, 28 Feb 2022 15:44:42 GMT by turbopodge
Hi, I've seen that page. The information I require is not on there. Please answer the questions in my first post: 1) Do I declare the amount I paid for the components, or the value I intend to sell the finished product for? 2) If it's the latter, can I instead take the components into the EU, declaring their value, then assemble the finished product there?
Posted Mon, 28 Feb 2022 17:10:33 GMT by Customs oldtimer
The value of goods for customs purposes follows a set of rules that are pretty common in most countries. So when there isn't a sale that has caused the goods to be exported as is the case when you are taking your own goods. Look up customs notice 252 on value. Tip - the rules must be followed in order . However it looks like you haven't exported before so its unlikely the 2nd or 3rd. method could be used then method 4 & 5 can be considered together - Method 5 might work for you as you are the manufacturer. In terms of merchandise in baggage procedures - the HMRC guidance only includes UK rules. The £1500 limit is for the simplified on-line declaration. You can take a higher value of goods but you would need to make a full declaration and would likely need the help of a customs broker to make a declaration for you - which they would charge for. You will also have to make an import declaration into the EU country you are exhibiting in. Each country will have different methods unfortunately so you would need to check requirements in the country you are going to. As a minimum you would be expected to go through the red channel and declare to the customs officer orally. You will then have to do everything in reverse with what you bring back. You may also be charged duty & vat on entry if you intend to sell the goods at the exhibition.
Posted Tue, 01 Mar 2022 15:47:34 GMT by turbopodge
Thanks for that very helpful post. Customs notice 252 brings a fair bit of clarity to this issue. Going by method 5 the declared value of each item is £25. Using the UK retail price - method 4 - would result in a £150 value. I know which value I'd rather pay VAT/duty on. According to notice 252 I get to choose... that's right isn't it? Method 5 can come before 4 according to the guidance.
Posted Wed, 02 Mar 2022 11:25:25 GMT by Customs oldtimer
Notice 252 is written for importers into the UK. The EU rules are similar so for method 4 when there is mention of sales in the UK you need to read as if those are sales in the EU. Both method 4 and 5 should result in a similar value so double check that you have made the correct deductions in method 4 and the correct additions in method 5
Posted Thu, 03 Mar 2022 13:22:41 GMT by turbopodge
If the price I bought the components used to manufacture my goods for was anywhere near the final selling price of the completed product then I wouldn't have a business.
Posted Thu, 03 Mar 2022 17:15:14 GMT by Customs oldtimer
The point I was making is that method 5 builds up the value so it not only requires the cost of components but manufacturing overheads & profit as well. ( para 7.2 of notice 252). Method 4 takes the sale value and then makes deductions for certain elements. The purpose of these rules when there isn't a sale, is to get to a value for customs that would be reasonable as if a sale had occurred .
Posted Wed, 09 Mar 2022 08:56:29 GMT by HMRC Admin 17

Thank you for your follow up. Option 1 will be acceptable when using the simplified online declaration method. 

Thank you.
Posted Wed, 09 Mar 2022 08:59:58 GMT by HMRC Admin 17

Thank you for your follow up.

Following the simple online declaration method the value of the goods is entered as the value in which you declare them as.

The total must not exceed the value or weight limit advised on GOV.UK.

Once the goods have been cleared and accepted you're able to undertake any action for your business. 

Thank you.

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