VAT issue

[Psamsara]

Ok, so the thing is that i'm from Serbia and we are still not in EU, so i have no obligations in paying VAT.

Not sure how much is it, but it's about 18%. Obviously it can be a nice sum for something expensive... little compensation for a country where average pay is 350 euros.

 

I have receipts from Hard to find records, where i was buying long time ago, and it's a sum.  They told me that they don't refund VAT and that there is no  VAT reclaimable on second hand goods, which is not true as far as i know.

Certain someone who sells on ebay, as well on his own site, told me: "vat is not a factor its part of the price we dont add it", even though on checkout on his site it showed and deducted VAT, but fail to do it on final step. From my own experience this is due to some technical issues, and i had many troubles when i started buying records, as many sites didn't even have Serbia among countries to choose from. On his ebay listing this is what stands bellow: Value Added Tax Number

So i don't understand.

Juno is automatically removing VAT for me... crazybeat records as well, and they are selling used stuff. Vinyl Underground did the same thing.

Would like to hear if someone knows something on this subject, as i really feel i shouldn't be paying for this

[Blackpoolsoul]

Not sure if this is the correct thread for this

Would this help ?

https://www.unitedcashback.com/vat-refund-serbia/

[Psamsara]

18 minutes ago, Blackpoolsoul said:

Not sure if this is the correct thread for this

Would this help ?

https://www.unitedcashback.com/vat-refund-serbia/

Thanks for this, but i'm afraid this is for companies only.

Tried to write them, but it's a robot assistant.

[Blackpoolsoul]

1 hour ago, Psamsara said:

Thanks for this, but i'm afraid this is for companies only.

Tried to write them, but it's a robot assistant.

In that case I would ask KPMG (other big companies are available but they deal with Serbia)

[Colnago]

You can’t claim vat back on a record, unless you were a record dealer buying from another record dealer and both of them vat registered . I would have thought.

[Winsford Soul]

Don't know if this helps you 

 

Edited January 12, 2020 by Winsford Soul

[Psamsara]

2 hours ago, Colnago said:

You can’t claim vat back on a record, unless you were a record dealer buying from another record dealer and both of them vat registered . I would have thought.

Nah. Like i said many shops have deducted VAT from my order. Not just for records, but for clothes etc.

[Psamsara]

1 hour ago, Winsford Soul said:

Don't know if this helps you 

 

That's the other way around... didn't know about that.

Anyway, this is merchandise. I'm sure nobody would refund if there was no need for it... and it wouldn't happen that sites automatically deduct.

It just can't be the same price for the country that is not in EU, as for the country that it is and where tax is added.

[Blackpoolsoul]

4 minutes ago, Psamsara said:

That's the other way around... didn't know about that.

Anyway, this is merchandise. I'm sure nobody would refund if there was no need for it... and it wouldn't happen that sites automatically deduct.

It just can't be the same price for the country that is not in EU, as for the country that it is and where tax is added.

https://home.kpmg/rs/en/home/about/who-we-are/about-kpmg-in-serbia.html

You can email them

[Psamsara]

I will, thanks 

[Colnago]

21 minutes ago, Psamsara said:

Nah. Like i said many shops have deducted VAT from my order. Not just for records, but for clothes etc.

Nah , you can’t be vat Registered in the uk and just knock the vat off , they must have given you some discount but you can’t just knock vat off , unless there is some special exemption with the country you’re in . Which I doubt , but maybe there is . 

Edited January 12, 2020 by Colnago

[Psamsara]

7 minutes ago, Colnago said:

Nah , you can’t be vat Registered in the uk and just knock the vat off , they must have given you some discount but you can’t just knock vat off , unless there is some special exemption with the country you’re in . Which I doubt , but maybe there is . 

It definitely wasn't discount... though i don't mind discounts  

Exemption is that is non-EU country, thus doesn't need to pay for tax which is for EU countries. It should be that, but it's not discount.

[Colnago]

4 minutes ago, Psamsara said:

It definitely wasn't discount... though i don't mind discounts  

Exemption is that is non-EU country, thus doesn't need to pay for tax which is for EU countries. It should be that, but it's not discount.

Well they definitely shouldn’t have charged you it if the country is exempt and if they’ve forwarded the vat to custom and excise then you should get a refund, I’d get in touch with customs and excise if you don’t get any joy of the traders , good luck . 

[Psamsara]

Thanks.

I just feel they want to avoid refund, even though that money shouldn't belong to them in the first place. I guess they want to keep it for them self.

Sorry if i'm wrong.

[Timillustrator]

If a UK trader is VAT registered (and not all sellers will be because they have to turnover £85,000 before they are obliged to register) and they are selling goods to a consumer in a non-EU country they should zero rate the VAT rather than charging 20%. They will need proof that the goods are leaving the EU. 

So check that they are VAT registered first (if not then there will be no VAT on it anyway) and that they have added 20% VAT (it's not always itemised) if so you should contact them and try and explain why they should zero rate it.

They won't be keeping it for themselves, that would be clear VAT fraud, they would be paying it to HMRC but they certainly wouldn't give you (a third party in a non-EU country) a refund they would just refer you back to the seller whose responsibility it is to sort it out.

[Psamsara]

1 hour ago, Timillustrator said:

If a UK trader is VAT registered (and not all sellers will be because they have to turnover £85,000 before they are obliged to register) and they are selling goods to a consumer in a non-EU country they should zero rate the VAT rather than charging 20%. They will need proof that the goods are leaving the EU. 

So check that they are VAT registered first (if not then there will be no VAT on it anyway) and that they have added 20% VAT (it's not always itemised) if so you should contact them and try and explain why they should zero rate it.

They won't be keeping it for themselves, that would be clear VAT fraud, they would be paying it to HMRC but they certainly wouldn't give you (a third party in a non-EU country) a refund they would just refer you back to the seller whose responsibility it is to sort it out.

I guess they are registered since there's VAT number on all of the receipts? Not sure how that works, but my guess is that it means they are. As for the proof - the proof is that billing and shipping address is from non EU country.

Second thing is that the price for me on the site is the same as it is for EU countries. On the net it usually takes that i choose Serbia as a country, and site automatically knocks VAT off. Now, this is not for all sites... let's say it's majority. So it's not right if the price is the same?  I'm talking about Hard To Find Records shop here. The answer i got is that there is no VAT reclaimable on used good, but this is not true. As for the other person's site (not gonna mention yet), when i've put item in the basket it showed VAT, and how much is it without it. I bought it on ebay from him and on his listing there was this: 

Value Added Tax Number:

GB 9817(xxxxx)

So my questions are: If there is VAT number on receipts they must be VAT registered? And if your own site shows and deducts VAT at one point, you must be VAT registered? And if you are, i guess you can't choose to which item VAT will be added, and to which it won't?

Edited January 13, 2020 by Psamsara

[Timillustrator]

1 minute ago, Psamsara said:

I guess they are registered since there's VAT number on all of the receipts? Not sure how that works, but my guess is that it means they are.

Second thing is that the price for me on the site is the same as it is for EU countries. On the net it usually takes that i choose Serbia as a country, and site automatically knocks VAT off. Now, this is not for all sites... let's say it's majority. So it's not right if the price is the same?  I'm talking about Hard To Find Records shop here. The answer i got is that there is no VAT reclaimable on used good, but this is not true. As for the other person's site (not gonna mention yet), when i've put item in the basket it showed VAT, and how much is it without it. I bought it on ebay from him and on his listing there was this: 

Value Added Tax Number:

GB 9817(xxxxx)

So my questions are: If there is VAT number on receipts they must be VAT registered? And if your own site shows and deducts VAT at one point, you must be VAT registered? And if you are, i guess you can't choose to which item VAT will be added, and to which it won't?

Yes, it would be fraud to put a VAT number on there if you weren't registered so they must be.

The word "reclaimable" is confusing, you (as a consumer) can't reclaim VAT, only another trader who is also VAT registered can reclaim VAT so that is not relevant.

VAT registered companies can "zero rate" goods or services in certain circumstances - selling to consumers in non-EU countries, certain exempt items, selling services to disabled people etc. But maybe their website isn't set up to take this into account? Lots of companies selling goods to consumers such as shops don't give prices without VAT they just add it automatically although they have to show it on receipts/invoices.

 

[Colnago]

9 hours ago, Timillustrator said:

If a UK trader is VAT registered (and not all sellers will be because they have to turnover £85,000 before they are obliged to register) and they are selling goods to a consumer in a non-EU country they should zero rate the VAT rather than charging 20%. They will need proof that the goods are leaving the EU. 

So check that they are VAT registered first (if not then there will be no VAT on it anyway) and that they have added 20% VAT (it's not always itemised) if so you should contact them and try and explain why they should zero rate it.

They won't be keeping it for themselves, that would be clear VAT fraud, they would be paying it to HMRC but they certainly wouldn't give you (a third party in a non-EU country) a refund they would just refer you back to the seller whose responsibility it is to sort it out.

Hi , you don’t have to reach the turnover threshold to be vat registered, but as you say , once you hit that legally you have to register, but you can volunteer to go vat registered on any turnover if it’s viable .The seller could be in a bit of trouble if he shouldn’t have charged him the vat as the inspector will be on the alert and will have to investigate in case of any mistakes or wrongdoing intentionally or not . I don’t know where he’d stand regarding a refund as if customs and excise have received the money when they shouldn’t have they are obliged to refund it , we’ve never had a problem with a refund from them , but outside the eu ? I don’t know .

Edited January 14, 2020 by Colnago

[Timillustrator]

57 minutes ago, Colnago said:

Hi , you don’t have to reach the turnover threshold to be vat registered, but as you say , once you hit that legally you have to register, but you can volunteer to go vat registered on any turnover if it’s viable .The seller could be in a bit of trouble if he shouldn’t have charged him the vat as the inspector will be on the alert and will have to investigate in case of any mistakes or wrongdoing intentionally or not . I don’t know where he’d stand regarding a refund as if customs and excise have received the money when they shouldn’t have they are obliged to refund it , we’ve never had a problem with a refund from them , but outside the eu ? I don’t know .

I can't see them paying wrongly charged VAT to a consumer outside the EU.

[Sebastian]

If you're a VAT registered seller of second hand goods in the EU and you're using the "margin scheme" accounting method, then there is no VAT to be charged from the buyer on used items. There is no VAT on individual items, instead when you as a seller pay the end-of-year VAT to the HMRC (or corresponding organ in your country) the VAT amount is based on the total profit margin. It has got nothing to do with what each individual item sells for so a seller can't deduct VAT, because the price does not include VAT.

A seller can ofcourse deal in both used and new items and those sales should be accounted for in different manners. If you as a non-EU buyer buy one used item and one new item, then the VAT should be deducted from the new item, but not from the used item (because it does not include VAT).

Hope this makes sense...

More info:
https://ec.europa.eu/taxation_customs/business/vat/eu-vat-rules-topic/special-schemes_en#_Margin_scheme_for

Edited January 14, 2020 by Sebastian

[Sebastian]

On 12/01/2020 at 15:02, Psamsara said:

I have receipts from Hard to find records, where i was buying long time ago, and it's a sum.  They told me that they don't refund VAT and that there is no  VAT reclaimable on second hand goods, which is not true as far as i know.

 

As explained above, if the seller is using the "margin scheme" accounting method then there is no reclaimable VAT on second-hand goods.

 

Quote

Juno is automatically removing VAT for me... crazybeat records as well, and they are selling used stuff. Vinyl Underground did the same thing.

Juno and Vinyl Underground are only selling new goods as far as I know, that's why the VAT is deducted. 

The reason Crazy Beat is deducting VAT on used goods is probably because they don't use the "margin scheme" method and instead use regular VAT accounting across the board. The margin scheme method is optional and does create a lot more work accounting wise, so some sellers that only sell small amounts of used goods mixed in with the new goods use the "regular" method because it's easier.

Edited January 14, 2020 by Sebastian

[Colnago]

1 hour ago, Timillustrator said:

I can't see them paying wrongly charged VAT to a consumer outside the EU.

Like I said right at the beginning.

[Psamsara]

Ahhhh  so many information which my poor brain hardly can process 

This is obviously something i know very little about, and thank you all for your help.

Seb, as for the shops - HTFR also are selling "new" stuff, Vinyl Underground has sold me only used stuff... but basically there were many shops which would deduct, or at least i could see that they have a mention of VAT added.

To put it bluntly (because i can't do it any other way anyway ), if a guy has an ebay shop and sells a used record and he has:

Value Added Tax Number:

GB 9817(xxxxx)

on his listing, and on his own site, the very same record during checkout has a mention of VAT, which deducts (but fail do to so in the end) - does it mean that he has VAT added on this item, and that i can't be paying the same price for it, like people from EU?

[Psamsara]

7 hours ago, Sebastian said:

If you're a VAT registered seller of second hand goods in the EU and you're using the "margin scheme" accounting method, then there is no VAT to be charged from the buyer on used items. There is no VAT on individual items, instead when you as a seller pay the end-of-year VAT to the HMRC (or corresponding organ in your country) the VAT amount is based on the total profit margin. It has got nothing to do with what each individual item sells for so a seller can't deduct VAT, because the price does not include VAT.

A seller can ofcourse deal in both used and new items and those sales should be accounted for in different manners. If you as a non-EU buyer buy one used item and one new item, then the VAT should be deducted from the new item, but not from the used item (because it does not include VAT).

Hope this makes sense...

More info:
https://ec.europa.eu/taxation_customs/business/vat/eu-vat-rules-topic/special-schemes_en#_Margin_scheme_for

It's confusing...

Ok, so we have:

Who is covered: second-hand goods

--------------------------------

Obligatory for EU countries

--------------------------------

The goods supplied outside the EU are exempt from VAT

 

If he is using that Margin Scheme, there's VAT on second-hand items which non-EU countries should pay.

Sorry if i'm missing something obvious.

 

Edited January 14, 2020 by Psamsara

[Bbrich]

Vat, especially x-border (within country v within EU v outside Eu...) vat is very complex and an awful lot of businesses dont understand it properly and neither do some of their accountants !  this is especially true for smaller businesses who may only do a small amount of x-border transactions.

My advice, forget the technicalities because you will have trouble explaining/convincing the seller even if you get to grips with it all. Just say you want them to ship the product to you in Serbia and will they reduce the price by the vat. Depending on their answer you decide if you wish to pay that price or not. 

[Psamsara]

11 hours ago, Bbrich said:

Vat, especially x-border (within country v within EU v outside Eu...) vat is very complex and an awful lot of businesses dont understand it properly and neither do some of their accountants !  this is especially true for smaller businesses who may only do a small amount of x-border transactions.

My advice, forget the technicalities because you will have trouble explaining/convincing the seller even if you get to grips with it all. Just say you want them to ship the product to you in Serbia and will they reduce the price by the vat. Depending on their answer you decide if you wish to pay that price or not. 

Yeah thanks, but those orders have already been made...  and i started this topic because i feel i was charged something i shouldn't pay.