Shipping to EU from UK

We are selling some stuff to EU, and all over the world now (see shop.revk.uk).

This is all a bit new to us, as we have traditionally only dealt with UK customers. This started with circuit boards stocked at Amazon, and Amazon just sorted the EU VAT (paying us the VAT exclusive amount as an export) for sales in EU - very slick.

Moving on (after Amazon screwed us over) we started selling on Tindie, and Tindie do not do anything special for EU at all. So all our parcels hit customs, and the recipient had to pay VAT (and admin fee). This is the default if you do nothing special when shipping to EU.

However, when Tindie screwed up badly (will they ever recover?) we started selling on Lectronz. I have to say that they have been great. This led us to start to understand how it should be done.

IOSS

The Import One Stop Shop system in EU means we could get an IOSS number for sending small packages (value up to €150) to EU with VAT paid - this means the customer has a much quicker and more seamless delivery with no hassle from customs. We would have to file returns for this, but pay in one go for all EU.

However, it is even easier when using an on-line marketplace like Lectronz, as they handle all the VAT - working out the right rate and charging the customer and paying the VAT. All we have to do is quote their IOSS number as part of shipping.

We integrated the Lectronz API and the Royal Mail Pro Shipping API so staff can just click "print postage" and out pops the postage label and customs label, simple.

The EU has gone to some effort to make this slick and easy for small parcels going in to the EU. Well done EU.

The new €3 duty

As of 1st of July the EU made things difficult - the exact opposite of the slick and easy IOSS process - adding a new €3 import duty on small parcels value up to €150. This is separate from IOSS, so even with IOSS and prepaid VAT, the recipient gets hassled by customs for €3 duty!

Lectronz moved quickly, and added the feature to their systems to work out the €3 duty, and add to the price, to pay us, so we can post "Duty Paid". I updated the API code and set to send duty paid via Royal Mail Pro Shipping API.

Yay, all sorted, all slick again, albeit €3 more expensive for the customer (thanks EU!).

Well no!

This started off OK, with a few parcels, but then we hit an error where Royal Mail will not do Duty Paid to Latvia. Arg, why not? Lectronz were very helpful sorting a refund of €3 so we send not duty paid and explained to customer.

So I decided to check the rate card from Royal Mail. The rates to EU are a mess anyway - they have a base price and per-kg price. The base price ranges from £4.45 to £7.70 which is not too mad, but the per-kg ranges from £0.80 to £10.85 which is mental.

The surprise is that duty paid is not available for Belgium, Bulgaria, Croatia, Czechia, Denmark, Estonia, Finland, Greece, Hungary, Italy, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia, and even Spain.

This is crazy - with all EU countries charging this new €3 duty - why the hell do Royal Mail not handle this.

The other oddity is that the extra cost for sending duty paid, where possible, varies wildly - from a more reasonable 50p to nearly £5 in one case. It is daft for a customer to pay an extra £5 to handle a €3 duty.

What have I done about it?

I have done a shipping rate for all Europe countries individually. Yes, tedious.

Where duty paid postage is available I have listed that (with the extra cost) so customers have a choice.

It would help if Lectronz allowed me to code a per-kg rate for some countries - I have asked.

We still do IOSS for EU where applicable.

So yes, sorted for now. And it means a sting of countries have the hassle of paying duty on receipt, and a few others make sense to do that anyway as the extra cost is daft.

Update

And today we have...

• Shipment to Romania saying IOSS not allowed, but we have shipped to Romania with IOSS before, and it is on the rate card.
• Shipment to Germany with no IOSS and no duty paid, a simple DDU but over €150 and they say NDX not allowed. Well NDX is simple "non document". We tried HV which is "Non documented high value" in case over €150 was the issue, but still says NDX not allowed (yes, I checked the JSON, we set HV).

Arrrrg!

Update

Now seems there is a PDDP with non PDDP service to do the €3 duty and IOSS at once somehow. Trying to make sense of what Royal Mail have sent. If so, it may be simple, but this is mental.

Update

Nope, they sent me a link to a document saying MP7 (DDU normally) with DDP and IOSS is available, but an email saying MPR (DDP but only to some EU countries), but then sent the original PDF again which says MP7 and DDP.

They clearly have no clue!!!

A new UPS scam, it seems.

I think I am seeing a new scam.

Background

When an item is delivered to UK from overseas, we, as recipient, may have to pay VAT, and occasionally duty, as the importer. It is a legal requirement.

Yes, as a business we have "postponed VAT accounting", and even the possibility of a "Duty Deferment Account", and DHL get some credit here for handling both very well, with no admin fees. UPS do not get any credit for this at all.

But as a consumer there are two ways this goes down.

1. They refuse to deliver unless you pay first, or they demand payment on the doorstep. The scam is they want an admin fee that was not pre-agreed with them, and not part of any contract. And you have no choice if you want the parcel. It is a scam as it breaks pretty much all consumer contract protection laws, and is admin that is normal and so should be part of what they charge the sender, IMHO.
2. They bill you later, and try and charge the admin fee as well. Usually paying the legally required VAT/Duty and NOT paying the admin fee, can work. They do not like it, but I do not think they have any legally enforceable right to their admin fee. Even so it is time consuming and hassle, and I really need to publish an admin fee I will deduct from such payments and argue that is as valid as theirs.

So yes, un-agreed admin fees to recipient are a scam. That is my view anyway.

Note: Royal Mail have a law allowing them to charge an admin fee, couriers do not. There fact there is a law especially for this - kind of proves it would not be legal without such a law.

A new scam

I am now seeing what I assume is a new scam. This time by UPS. Yes, I believe this is a scam.

This relates to a shipment with Duty/VAT pre-paid by sender. So no charge to recipient. No legally required payment by recipient. Sender PAID to get parcel to recipient duty/VAT pre-paid.

In this case a parcel ordered on Amazon UK (no clue non UK shipper). And Amazon do generally handle everything pre-paid Duty/VAT. They are actually really good at that, and for shipments to EU are "deemed supplier" and handle local VAT and all sorts. Very neat.

The item had zero VAT (condensed milk, but declared as tomato sauce!).

But UPS decided to send an invoice (after delivery) for £6.65+VAT (£7.98) for an "entry prep fee".

Did the recipient ask them to do any entry prep? No, obviously not. That is a normal part of delivery, something they are charging the sender for. So this is a case of charging the admin fee even when there is ZERO VAT or Duty to pay.

It is not a lot, but I bet a lot of people pay, and UPS must handle millions of parcels. This is a big scam, and needs to be reported.

I think this is time to report this fraud to the police.

Import Duty

Latest update on import Duty and VAT.

VAT is sorted for most couriers (well DHL and FedEx) as postponed VAT accounting. This is mostly automatic.

For duty we have an HMRC account now, all works. We advised DHL and they were helpful which was shocking. We have now received our first import delivery with duty, albeit £7.25. Emails from DHL about it. Statement from HMRC. I expect the direct debit soon from HMRC. ZERO ADMIN FEE from DHL.

This is finally clean, and no stupid admin fees. DHL for the win. Well done.

I have emailed FedEx and they are struggling to handle it, so yeh, not good. Hopefully we sort with them soon.

But DHL are still arseholes, sorry.

Before this import was one with £5.76 duty, which sort of kicked off sorting this all. They invoiced £5.76 plus a £5 admin fee.

To be clear, we have no contract with DHL, their contract is with the sender.

What is extra fun is when they told us, before delivery, we said "but we have a duty deferment account at HMRC" (not realising this needed setting up in advance with DHL), but also advising our published terms which state a charge of £20+VAT admin fee for payment demands from couriers.

Even after that they delivered - in my view that means they have accepted our terms.

Invoice for £10.76

However, being generous, and as they had actually been helpful getting the duty account all sorted, I confirmed we would pay the £10.76 and checked bank details for this. We paid it on 9th Nov, including the £5 admin fee we never agreed. We quoted the reference they asked us to.

Note, if you pay A&A with right reference it appears in your A&A account in seconds, you are immediately emailed a statement, and if clearing an overdue debt your services are instantly re-instated, 24/7 automatically. Handling incoming payments (especially if they have the correct payment reference) is not hard, honest.

Threat of legal action

Today (13th) I get a threat off legal action for £10.76. Yes, the £10.76 I generously paid (generous as it included £5 I never contracted for or agreed).

You can imagine the reply I have now sent...

Fucking arseholes!

More on VAT an Duty on imports

I explained PVA (Postponed VAT Accounting) - it is moderately simple, we need (a) a courier that is not brain dead (so don't use UPS), and (b) EORI or VAT stated on parcel - which a lot of senders allow for anyway but could just be squeezed in to address.

Courier declares the import to HMRC. HMRC do a monthly statement to allow for on VAT return. VAT all cancels out.

But duty is different!

We get duty much more rarely - some product types from some countries, and very much non obvious it will apply when you order. It depends on where supplier ships from, or possibly origin of goods (not sure which), and how they declare the goods.

It is usually small, meaning it can easily be way less than courier admin fee even! Very annoying.

Duty Deferment Account

The answer is a duty deferment account. Unlike VAT which cancels out on the VAT return, DDA is a separate account with HMRC where they charge you the duty due. There seems to be a pre-pay option but not clear how that works, and a direct debit option, and a need to guarantee the duty due. So a tad more messy. We have done all that.

But surely that is it - link to your EORI/VAT number on the parcel and have duty paid by monthly DD without any annoying courier admin fees.

No, not actually!

No, it is not so simple (WTF not?).

I have a DDA account number which has to be quoted, which is not the VAT or EORI number.

I have to complete a form and send to HMRC telling them the exact details of the import agent(s), i.e. couriers, I wish to use and authorising them to use the DDA account number.

I also have to tell the agent (e.g. DHL) to use the account and confirm they have the authority (copy of the form).

Why make is so bloody difficult! Arrrg!

Oh, icing on the cake, the form does not appear to actually be on gov.uk web sites anywhere!

I'll see how this all goes... Now to argue over a £5 admin fee with DHL.

Update:

Even though DHL, and web pages on gov.uk, all refer to this mystery form, apparently it is now an on-line thing - so simpler, but not as easy.

Deliveries from China

I have PCBs made in China (well Hong Kong).

This is all my many small PCB projects (not FireBrick). I would rather use UK suppliers but I am sorry, even for just 5 PCBs, populated or unpopulated, even with carrier charges, China is way cheaper, I mean a *LOT* cheaper, and generally even faster. I'd love UK companies to up their game, and cope, and I have spoken to some, but they cannot get close. If they could get close, I'd got for it. It is a shame.

Duty and VAT

So, I have had to learn how it works. Before Brexit there was some stuff that worked well from EU. But in the last few years things have changed (not just because of Brexit), and now there are some things that are, honestly, better.

If you have ever ordered something as an individual from overseas, and it is over the small "gift" or "minimum" level where they don't care, you will have been hit with a surcharge by the courier. Often on the doorstep as a surprise.

This has three parts potentially.

1. Duty - some levy on some types of goods. The government have a moderately sane web site for this (https://trade-tariff.service.gov.uk/find_commodity) which helps you work it out. The system itself seems insane, and a minefield, but the web site helps. My experience is "duty" never applies to any of the bits we order, thankfully.
2. VAT - this applies always
3. Courier admin fee

The last part if the big problem, in my view. Handling customs, duty, and VAT, is an inherent part of the process of being an international courier. It is no more an unexpected cost than paying for petrol for their delivery vans. Yet, somehow, they decide they will charge the recipient for this admin work and not make it simply part of the cost of shipping.

This is simple for them, as they can legally expect the recipient to pay Duty and VAT so they add their bit. Refuse to pay and they won't deliver. It is a basic lien / or blackmail. In my view it should not be allowed. Royal Mail actually have legislation to allow it (!) which shows that it should not normally be allowed (i.e. if it can just apply normally then Royal Mail would not need special legislation for it).

The recipient has no contract with the courier. They have not agreed a price for service the courier has chosen to provide. Even if they accept they provide the service that is logically the start of negotiation on a fair price. As a consumer even an implied contract like this would be unfair and so not enforceable. But they have you over a barrel.

Postponed VAT accounting

If you are receiving goods as a company, well, as anyone VAT registered, things are better, finally.

It used to be you paid the courier, and their admin fee. You then battled to get a formal VAT invoice from them (not easy if payment collected on the doorstep). Then you included that VAT (not their admin fee) in your next VAT return to reclaim it - up to 3 months later.

End result - not paying VAT. But impacting cash flow, and you paid an admin fee.

Postponed VAT accounting changed that - you account for the fact you should have paid VAT on imports, and that you are claiming it back, in the totals on the next VAT return (surprisingly not separate fields for that). But you don't pay VAT on import. Obviously they get the tax when you finally sell with VAT at the final (higher) price.

This gives the courier no excuse to charge an admin fee - yay!

DHL, FedEx, UPS

The three main couriers used by JLC seem to be DHL, FedEx, and UPS. They have different prices and delivery speeds. FedEx is arguably the cheapest, and works (though hassle with them insisting on a signature). UPS are next. DHL cost more, but probably fastest. Until recently I was using DHL. I made the mistake of trying the others.

• DHL are quick, text/email progress, text/email on the day with time window, even live tracking the van, cope with leaving on doorstep if I ask, and handle Postponed VAT Accounting no problem.
• FedEx are OK, not the same progress messages, struggle to "leave on doorstep", but do handle Postponed VAT accounting
• UPS are idiots. Slow. No updates. And it seems have no clue on Postponed VAT accounting, so insist on charging on delivery, and their admin fee is expensive (more than difference in courier costs).

So, obvious lesson, do not use UPS, as they cost more in admin fee than it is paying DHL to send in the first place.

Don't use UPS, simple as that!

In practice the few orders using UPS in the pipeline are literally going to be returned to China, at UPSs cost, if they cannot work it out, and then I'll pay for delivery by DHL. This is slightly more than UPS admin fee, but it is the principle - I want UPS to suffer the cost of returning to China for their stupidity, and I've learned to never, ever, use them again, and tell you the same.

Just to add, we now have several supposed "delivery attempts" which I can prove with extensive CCTV were not, in fact, attempted, by UPS, over the last few days. Why do that?!?

Pre-pay

Another option is have JLC send via a courier but with pre-paid duty. Same set of couriers.

This is bad for several reasons - for a start the extra they charge up front is not the normal 20% VAT. It seems a random and larger amount. I have no clue why! But also it is not a VAT invoice, so you can't easily reclaim the VAT! To be fair getting a VAT invoice from couriers paid on receipt is not easy either.

It may work for an individual who cannot reclaim VAT, as may be cheaper done this way than VAT and admin fee on receipt. So worth considering in such cases.

Duty

I mentioned duty. This is not the same as VAT (which a business can reclaim). You have to pay it.

Duty applies on some specific classes of goods, from specific countries, and it really is very specific! It is basically politics.

Thankfully JLC are not totally daft - I can say the category for the goods, ensure it is right, and not have duty charged. I only got that wrong once, and had a couple of pounds duty (plus a courier admin fee)!

If you have to pay duty, tough, it may be that with enough imports an "account" somehow with chosen courier can avoid admin feeds for these. Not 100% sure. Thankfully we don't do stuff that needs duty.

It is nice that JLC offer a clear choice of couriers.

What is really nice is when sender will work with you to ensure clear and accurate marking of the goods. For a recent order from China (not PCBs this time) I searched on that duty checking page and identified the exact description and "category code" and the sender agreed to clearly use that wording and code on the parcel to avoid issues. I hope it works (will find out in 30 to 60 days).

On line orders

I ordered something recently, on-line, on a whim, a new iPhone case.

I paid in UK pounds (£) there was no immediate clue that the site was anything other than a normal UK supplier selling something to people in the UK.

I ordered on Saturday.

What pisses me off is how this is so much not the case. It seems it was a US company, and I know things can get from US, or almost anywhere in the world, to here, in a day or two, but they picked the slowest means to send to me on the planet from what I can see.

They seem to have used DHL (which people will know how I am unimpressed with them) and some sort of service that is slower than slow - delivered by snails. This is an item ordered and paid for on 7th. It is now 13th, and the damn thing is still in the US, FFS.

What is worse, there is a chance I end up with some damn duty or VAT bill to pay on top.

I just went to a web site - saw an item listed in £ and paid, why the hell is any of this my problem now?

All I can say is it better be a damn good phone case when it gets here!!!

P.S. It did eventually arrive. Quite a nice case for £16
P.P.S. It promptly broke, so I have a spigen one now, much nicer.