Art import not awarded 5% reduced rate

Hello. I recently imported original art under tariff 9701/2 which should benefit from duty-free entry and a reduced VAT rate of 5%. The import did benefit from duty-free entry, but a regular 20% VAT rate was applied. The courier (Fedex) paid the fee on import and now wants me to pay them. I have all the documentation to support it is an original artwork (this was in the waybill on arrival). How do I correct the situation? Can the courier do it, or do I need to pay Fedex and then apply for a repayment using form C285? I plan to import some more artwork so if there is anything I can do next time to have the 5% VAT rate applied, please let me know. Thanks for your help.

The 5% VAT is not applied automatically and only applies in specific circumstances. Therefore how FedEx declared the import to customs will depend on what information was provided to them in the first place. If no one advised them that the goods are entitled to reduced rate VAT they would declare as if for standard rate. https://www.gov.uk/guidance/how-to-value-goods-for-import-vat If the goods do qualify for reduced rate VAT then you can either go back to FedEx and ask them to amend the declaration if they didn’t follow the correct instructions. If they were not informed to apply the lower rate VAT then they may charge you for the service. You can also make a reclaim directly to HMRC after paying. This assumes you are not VAT registered. If you are VAT registered you make an adjustment in your VAT return.

Hi K Bevan,
Please see the guidance below:
IMPS05200 - Valuation for import VAT: exceptions to the normal rules: permanent imports: works of art, antiques and collectors’ items
As regards recovering the incorrect import VAT charged please contact our International Trade Team:
Contact HM Revenue & Customs
Thank you.

Hello. Thank you both for your answers. I spoke to someone on the HMRC online chat yesterday who told me the 5% reduced VAT rate is only available to VAT registered companies. Is this correct? Most guidance online, plus both of your answers, suggest to me that the 5% reduced rate isn't restricted by the legal status of the importer (i.e. private persons vs. LTD companies). Are you able to comment on this? Thank you.

Hi,

The 5% rate of VAT on imports of original artwork is available to both individuals and businesses.

Thank you.