RCMart (& Others) now charging 20% VAT to UK

[Toolmaker72 507]

18 hours ago, mtbkym01 said:

Correct, it’s paid once, at point of sale. @Superluminal I’m not sure how the govt collects it

Vat is paid via accounts for the year to the U.K. government.  If self employed the vat can be offset against profits for the year.  As the last customer in the sale of goods the government will gain the higher amount in monetary terms as the goods are worth more.  So in theory each supply business claims from each other but the last person in the chain actually pays the vat the government gets.  If that makes sense 🤔

[nowinaminute 2815]

23 hours ago, Badcrumble said:

If I am reading this right, the base costs of good has gone up due to the imposition of VAT at source but so has the threshold for import duty overall that is a win? You just have to spend a little more at RCMart to justify it?

I think for buying from places like China, anything UP TO £135 the VAT will be paid at the point of sale and then anything over, the fees will be decided at the border. At least that's how I think it will be. As far as I know, duty has only ever been payable on stuff over £135 anyway so no advantage.

The downside is that even cheap stuff is going to suddenly be 20% more expensive in pretty much every case because they are also abolishing the "low value consignment relief" where anything £15 or lower wouldn't have any VAT payable. I would say a good 50% of the RC stuff I got from China was less and than £15 and another 45% was marked as less than £15 by the seller of their own accord, this is where it's going to hit because whether you spend £1 or £100, you're going to pay the VAT now no matter what. I'm sure some sellers will just absorb that into the cost of the item but not all of them. And some may not even bother selling to the UK at all.

The seller still has the option to mark an item as a gift as well but this is far from guaranteed and while I don't complain when it happens, we should certainly not expect or assume the seller takes measures to cheat the system. And there's limits to that trick anyway, you can hardly write "gift £25" on the parcel for a Traxxas X-maxx.

And while it's at a sellers discretion whether they add a full 20% to compensate or absorb some or all of it into the price, it seems like companies like ebay might be putting a blanket 20% charge on stuff.

It's a big mess to be honest and while the intention might be to help UK business, quite frankly a lot of the cheapo Chinese stuff I get isn't even available from UK sellers and when it is, it's usually just a Chinese seller with a warehouse in the UK anyway!

I wonder how this will effect the likes of Bangood and Gearbest too. Until now, if you used a delivery service like "European priority line" they somehow made it so you could get expensive stuff like actual RC trucks without paying any fees. It seems like they shipped stuff to themselves in Europe first and then onto the seller which until now just counted as a intra-EU delivery so no extra charges were incurred but of course now we are out of the EU so I don't know how that will work out.

It's basically just a big mess at the moment and things will inevitably get a bit more expensive.

All I'm going to say is that a lot of this stuff was predicated if not inevitable back before the vote happened but it seems to me that a lot of Brexit voters only had one thing in mind when they made their decision. I'll leave that to your imagination but parallels can be drawn to how Trump managed to win in 2016.

Still, at least we have blue passports now, huh? (even though we could have had them anyway)


 

[Juls1 1661]

In Australia a business needs to turn over $70k before they are required to charge and collect GST. The government simply tracks incoming parcels and when there is high volume that international business is required to collect gst. I’d say Rcjaz either isn’t doing enough volume or is still flying under the radar. Not sure on the process for UK but I’m sure it’s not too dissimilar.

[nowinaminute 2815]

Something else I don't quite get because I'm not very business minded.

We supposedly just made a free trade deal with the EU and "there won't be any extra fees" so the likes of Boris keep saying but on the other hand, it seems like EU sellers now have to charge that 20% VAT and send it to the HMRC. So to me that says that unless the sellers are able to magically reduce the prices by 20%, things are going to suddenly be 20% more expensive from EU sellers?

Am I missing something? Does paying the 20% UK VAT mean they don't have to pay 20% to the EU or something? Even if that's the case, between the extra paperwork and hassle setting up HMRC accounts, I would be amazed if prices were unaffected.

 

[qatmix 794]

The thing you are missing is that the reality of the deal, is not the one that the renowned liar said we had. 
 

Its very sad, and the impact for exports and sales to the EU is looking to be very harmful.

 

But blue passports.. (that now have less freedom than the old ones).. erm hurrah!

[BuggyGuy 1106]

The Postman Brought me thread appears quieter than usual... I wonder if that's semi related to all this chaos at the border & Brexit! 

[nel33 870]

How reliable is RCMart? I ordered an MST tire removal kit and am looking Into a 1:10 FD3S body shell. The tire kit could take up to 7days  to month without pandemic delays. It's not a big worry for me atm. They are selling some body shells cheaper than Amazon when it's on sale at RC mart. I can easily save$30 by going through RC mart vs Amazon.  It's no rush either as I have 2 body shells for 1 chassis and a 2nd nice body shell .is on my wish list.

i do have some stuff on the RC mart wishlist that went on sale and was sold out long ago??? do they restock certain products often? they have a Sileighty body shell i really want.

[Finnsllc 917]

so you guys have an import tax? i dont quite understand. I do know that when i order items from across the pond i deduct 20 percent of the cost because i am in US. If i ship to UK do u guys pay a fee? Ive seen comments about shipments being "held" at the post office? then having to pay to get your box? I would like to know how it works if someone will explain it to me !

[sosidge 624]

On 1/3/2021 at 12:31 AM, nowinaminute said:

Something else I don't quite get because I'm not very business minded.

We supposedly just made a free trade deal with the EU and "there won't be any extra fees" so the likes of Boris keep saying but on the other hand, it seems like EU sellers now have to charge that 20% VAT and send it to the HMRC. So to me that says that unless the sellers are able to magically reduce the prices by 20%, things are going to suddenly be 20% more expensive from EU sellers?

Am I missing something? Does paying the 20% UK VAT mean they don't have to pay 20% to the EU or something? Even if that's the case, between the extra paperwork and hassle setting up HMRC accounts, I would be amazed if prices were unaffected.

 

While we were in the EU there was an agreement that VAT charged in any country would count as the VAT for the UK.

So basically, when I ordered items from an EU seller, I would pay their "VAT-included" price, and that would be the equivalent of me already having paid VAT in the UK. So no additional tax to pay.

Situation now is that the EU seller should be charging me the "VAT-free" price, and then the UK VAT gets added on again (somehow).

So ordering from Germany would be a reduction of their 19% VAT and then 20% going back on. Effectively no difference.

Ordering from outside the EU has always bee "VAT-free" with the VAT to be added on arrival in the UK. Of course, many of us have bought from sellers who habitually mis-label items as low-value gifts to reduce the risk of the VAT being charged.

From what someone else has said it seems that the potential issue is that retailers will have to register with the UK tax authorities to charge VAT on the UK's behalf on smaller value orders. This will be a disincentive to a lot of retailers who only do small volumes of trade with the UK. 

[Badcrumble 4204]

I wonder what will happen to the RC Mart order I impulsively made on 14 December. I don't know whether it arrived in the UK before 31 December as it was destined for the office (Thank you, tier 4).

I'll be gutted if I get stung for import and handling as it was only about £15! 

I've finally seen how VAT is shown in the RCMart basket.If only RCMart would show prices in GBP.

 

[simalarion 2196]

RCMart now add 25% on everything shipped to Norway and the shipping cost 93 $ at the lowest on Kits, so that is not going to happen, its been this way for some time now. Seems RcMart do not remove Vat either so it sort off looks line your psying it twice

Tamico Remove Vat before sending to Norway, then added when arrived to Norway, they take 19$ in shipment so the prices are Much better at the moment:

[sosidge 624]

Funnily enough the BBC are running a story on this today - https://www.bbc.co.uk/news/business-55530721

No idea who decided we needed these measures (nowhere else in the world has a similar system) - feel like this is going to be a widespread nuisance...

[svenb 3778]

I wonder if this would mean the end of Royal Mail handling charges! 

A lot of stuff from the likes of Rcmart would still be a lot cheaper even with VAT added at source. 

[nowinaminute 2815]

3 hours ago, sosidge said:

Funnily enough the BBC are running a story on this today - https://www.bbc.co.uk/news/business-55530721

No idea who decided we needed these measures (nowhere else in the world has a similar system) - feel like this is going to be a widespread nuisance...

""The new system also addresses the problem of overseas sellers failing to pay the right amount of VAT on sales of goods already in the UK at the point of sale, raising an anticipated £300m every year."

I wonder how much it cost to implement all this?

""Why should a phonograph spares manufacturer in Idaho bother to register for VAT in the UK and how are you going to make them do it?" he said. "And if they send the package anyway, what are you going to do?""

I did wonder about this. If it's just assumed that the seller has charged VAT, does that mean they can just sent it to the UK and it will be delivered with no effort made to charge VAT and duty? How is it proven that the VAT has been paid? Will the package have a code on it that will have to match an online record or something? But if the seller is settling the tax annually, how can it be proven that a package sent 11 months before has had the tax applied?

This could take a pretty big toll on ebay in terms of sales from Chinese sellers. If ebay is imposing the 20% fee themselves, what's to stop people just buying direct or from sites like Aliexpress where the seller can just mark the item as a gift or possibly even just send it out without doing anything if there's no way to prove they haven't taken the VAT?

I guess the easiest way to find out is to see how the Chinese go about it. If there's a loophole they will be the first to find it lol

[nowinaminute 2815]

12 minutes ago, svenb said:

I wonder if this would mean the end of Royal Mail handling charges! 

A lot of stuff from the likes of Rcmart would still be a lot cheaper even with VAT added at source. 

It should do in theory for items under £135, it would at least take the uncertainty out of it!

The downside is that they are scrapping the waiver for anything under £15 but then again, there's certain stuff like motors, servos etc that will also be a lot cheaper still even with VAT added. Many such items you can only get in China anyway or if it's a UK seller they will triple the price!

One thing I've noticed a lot recently though is Chinese sellers holding their own stock in the UK and Europe, I wonder if that will be an increasing trend..

[nowinaminute 2815]

  

Well that's everything on Aliexpress 20% more expensive too, then. Even stuff under £15 that used to be exempt (at least 50% of the stuff I buy there)

Apparently, the entire EU is scrapping the low value exception thing this year though so it's not just a UK/brexit thing when it comes to the small items, everyone will get screwed.

This move also means the sellers will no longer be able to declare low values to get stuff through and with sites like Aliexpress/Ebay taking the VAT themselves and not the vendor, no scope for stuff being marked as a gift either.

Well, it was a fun ride while it lasted! At least there will be no nasty surprises on the doorstep.

I'm still curious as to whether it could actually be proven if a parcel coming in has had VAT paid or if they will just clear anything with a value under £135 on the box?

I'm still curious about how the Chinese will get around it lol.

For what it's worth, I pretty much exclusively buy kits and paint and stuff like that from UK sellers. It's mostly little things I get from China like servos, motors, accessories etc plus the additional Chinese brand RC vehicle such as WPL toys, JML, HBX etc.

 

[Superluminal 3750]

They will probably get around it just by not bothering to VAT register as a business with the UK gubment (but still probably up the price 20%)

As mentioned above I cant see how the UK can enforce this overseas because there are millions of small sellers who ship direct to the UK. The only way would be to have to check every overseas parcel against the sellers registered VAT number by which time the parcel is already in the UK (unless they are looking to start recording who has sent every parcel from where in the world, what was in it and its exact value to make sure the VAT is then sent here, but again cant see how they can force an overseas company to do that)

[nowinaminute 2815]

Just now, Superluminal said:

They will probably get around it just by not bothering to VAT register as a business with the UK gubment (but still probably up the price 20%)

As mentioned above I cant see how the UK can enforce this overseas because there are millions of small sellers who ship direct to the UK. The only way would be to have to check every overseas parcel against the sellers registered VAT number by which time the parcel is already in the UK (unless they are looking to start recording who has sent every parcel from where in the world, what was in it and its exact value to make sure the VAT is then sent here, but again cant see how they can force an overseas company to do that)

I'm just trying to imagine how long it would take to register all those sellers let alone keep track of the packages they send out.

And like you say, what's to stop some sellers collecting a little 20% bonus and keeping it to themselves?

The cynical side of me wonders if we will see large discrepancies between the amount of tax "the auction site" and the "river site" collect and how much they pay....

[moffman 5752]

On 1/2/2021 at 9:45 PM, Hairyjon313 said:

Just got some dampers on ebay from China for my Bullhead, VAT was added to the transaction.

VAT will be collected by ebay on items under £135, posted from outside the UK (or if not UK registered). Over £135 the seller needs to pay. Expect higher prices from now on.

But at least we took back our sovereignty ...

Yep welcome to the new UK were everything instantly becomes more expensive but at least we can all look at the political theory called "sovereignty".........we've shown the rest of the world............who's laughing now? (Probably the rest of the world)

[nowinaminute 2815]

Rcmart having very different delivery prices between "basket" and checkout" plus the VAT is charged on the postage too so suddenly over 2x the price with VAT and shipping costing nearly 5x the price of the item

[toyolien 4681]

It's all a bit of a mess I think. I just hope it gets sorted out soon. I don't fancy having to spend £135+ each time I place an order!

[Superluminal 3750]

Group buys!

[toyolien 4681]

4 minutes ago, Superluminal said:

Group buys!

Ooh yeah. Good idea. 

[Nwc100 462]

Ordered these from Plaza Japan last night, and no VAT on them from what I can see and the price has been the same for a while, I'm presuming they will get picked up at Heathrow for this minor indiscretion as usual!

From what I remember on the  CN23 it doesn't state tax has been paid or not on those forms so potentially Plaza Japan could charge me, not declare it and then I get charged again in the UK, and it's not like we (HMRC) are going to go chasing it, we are far too inept to do that 🤣🤣

And if I want my goods I will have to pay the tax and fees to release them and then fill in some Mickey mouse form to "try" and claim it back!

I'm not saying that's what they will do, and as I stated before I know nothing about importing or customs or VAT, I just want to spend a little of my hard earned on something!

[Badcrumble 4204]

Hmm, that doesn’t seem right to me me @nowinaminute

The seller must work out the consignment value of the goods by deciding their ‘intrinsic value’, this is the price the goods were sold for, not including:

• any transport or insurance costs, unless they are included in the price and not separately shown on the invoice”

I guess RC Mart aren’t going to split out the values on the sticker on the the front of the parcel - I can’t remember if they ever did in the past.

Let’s hope the cost of postage goes back down again over the next year!