Refunds are hard to claim once a mistake is made, they told ATG.
Since January 2021, works of art, collectors’ items and antiques imported into mainland Great Britain from EU states have been subject to import VAT at 5% (books of any age are zero rated).However, a number of platforms and couriers have been accused of mistakenly charging 20% VAT instead.
ATG published a reader letters on the issue over the past year, but many buyers are f inding the issues have continued and ar e commonplace. According to HMRC, the appropriate rate of VAT due on imported goods should be applied at the point of sale but in some cases the proper procedure has not been followed.
Small claims success
Barry O’Neill, who recently won a Small Claims Court case against eBay at Romford County Court on February 10 (he was awarded the refund due for overcharged VAT), is still finding issues when purchasing via the online platform. O’Neill, a collector and restorer of classic motorbikes, said that on numerous occasions he has been charged 20% VAT when only 5% was due. Bikes and bike parts over 30 years old are subject to the lower rate.
Victory in the Small Claims Court does not appear to have had the desired effect. In a recent invoice, O’Neill was again charged 20% with eBay asking him to provide proof from HMRC that VAT should be only 5%. He is still awaiting a refund from the site for this transaction.He told ATG: “It is exactly the same as every other attempt made on this issue. A lack of understanding at just about every juncture.”
Antiquarian horologist David Penney experienced similar issues with both eBay and DHL. He said: “As far as my experience goes, eBay never charges the correct 5%.”An eBay spokesperson insisted that its “tax calculation system is set up to ensure that the correct rate of VAT is applied to collectable and antique items, as set out under UK legislation”.
But they acknowledged that “in a very small minority of cases this isn’t possible, often due to the category the item was listed in. When this happens, users can contact us and, where appropriate, we will refund the difference.”
Penney has experienced a similar issue with some logistics providers.“The courier firms are also a problem as they seem to add 20% as well, even though the goods are described as ‘over 100 years old’. My latest problem with DHL was that they said the sender (a Dutch auction house) had not provided a commercial invoice and so the standard 20% was due. The auction house said they had. DHL refused to correspond with the auction house leaving me to handle HMRC in order to get the refund.”
Another dealer with a similar experience with DHL is still attempting to resolve his situation.Carl Anthony Gray, at Chinese porcelain specialist Guest & Gray, said: “I believe that the importer should not be responsible for errors made by the seller, sender, courier or Customs. There is something very wrong with the system.”
A spokesperson for DHL Express said: “DHL will always endeavour to import qualifying antique items using the appropriate rate and are continually looking for ways to improve accuracy and minimise errors made in this manual process.“Where VAT has been overcharged in error by any carrier, it will be fully recoverable as input tax by VAT registered importers.
However, if this is causing difficulties, there is the option to process a repayment claim through HMRC by providing a ‘VAT disclaimer’ confirming that input tax deduction will not be made.“If any DHL customers are continuing to experience this issue, we ask them to please get in touch with us. This will enable us to work with them to ensure all paperwork is clear going forward and proactively monitor future shipments to ensure smooth clearance.”
The antiques trade is hoping that the import VAT situation, now applicable on items coming in from Europe since Brexit, can eventually improve.Anthony Browne, chairman of the British Art Market Federation (BAMF), said: “BAMF is in constant contact with the Government and the Treasury as the whole system on import VAT is over-complicated.
“We hope to find ways to simplify the situation and we are exploring ways for it to be made less burdensome on the British art market.”