Brexit

[Armortek]

We have been asked by a few customers on the impact of Brexit on Armortek. Rather than answer the questions individually, we have put some information below. Please don't use this thread to express political views as they will be deleted.

From a production perspective, as most of what we do is in-house - the biggest risk to us is a disruption in material supply. Especially aluminium, most of which comes from continental Europe. This can be mitigated to some extent by minimising deliveries for March and April 19.

From a European customer perspective, if the UK leaves with no deal in place then shipments to you will be treated as shipments to non-EU customers - i.e we will not charge UK VAT, but you will have to pay local duties/ taxes and deliveries will likely take longer due to possible congestion at airports. If the UK leaves with a deal, then it depends on what that deal looks like, but impact on you should be minimal.

For customers in the rest of the world, you should not see any impact apart from possible longer delivery times in the event of congestion at airports.

Kian

[Robert Reid]

As a loyal customer in the "Rest of the world" I can say that it is no burden whatsoever!

Kian and his team make shipping and receiving kits here in the USA painless, seamless and no problem at all.

Whatever happens... I have no doubt that Armortek will make its customers and enthusiasts happy!

Cheers,

RPR

[Armortek]

2 years on from our original post above and with just a month to go, we are, unfortunately, still no clearer on brexit.

What we do know so far is:

- Most importantly, trade deal or not, our kits will not face import duty into the EU. This is because our kits are classed as scale model toys, which under WTO Most Favoured Nation (MFN) tarrifs has 0% duty.
More specifically, our kits are classed as :
HSS CODE 9503003000 - Tricycles, scooters, pedal cars and similar wheeled toys; dolls' carriages; dolls; other toys; reduced-size ('scale') models and similar recreational models, working or not; puzzles of all kinds
- Electric trains, including tracks, signals and other accessories therefor; reduced-size (scale) model assembly kits

- VAT (MwSt/ IVA/TWA/Moms/BTW/DPH) - We are still not clear on what will happen with this. Subject to the trade discussions that are ongoing, EITHER:
(i) we will ship good to the EU and VAT will need to be paid by the customer on arrival, OR
(ii) we will charge VAT as we currently do with our EU customers.

- We have been advised by UPS that they expect delays on shipments into Europe for at least the the first 2 weeks of January. We will therefore avoid shipping to Europe during this period.

We will provide more clarity as we get it !

[Armortek]

As 1st of Jan has come, sadly we enter into a new relationship with Europe.

The good news though is that we now have more clarity on what this means with regards to our EU customers. The points have been summarised below. If you are not clear on something then please let us know.

1. VAT - We will not charge any VAT on sales to the EU from the 1st Jan 2021. Instead, customers will need to pay their local VAT (- VAT (MwSt/ IVA/TWA/Moms/BTW/DPH). This will be coordinated by UPS and UPS will contact the customer directly for payment.
Customers who have already paid for kits or option packs in 2020 that will be shipped out in 2021, we will contact you individually to explain what needs to be done. Please give us a few days to do this. If you have not heard from us by the 15th Jan then let us know.

2. IMPORT DUTY - There will be NO IMPORT DUTY to pay.

[Peter Quambusch]

Thx Kian,

That´s good news!!

Cheers
Peter

[Christoffer Ahlfors]

The bad news is that the last time I had to go through this in another context, UPS charged around GBP 60 for the "service" to charge the VAT.
Not a big deal if you have ordered a model, but worth considering when ordering spare parts.

[Jan_Donadoni]

Actual Experience.
I hope that at least we will avoid the "customs/Import" duty.
I bought a few little things from UK in January-
- Had to pay VAT (22% in Italy)
- Had to pay "Dazio" (that is Import Duty) at 12%
- Had to pay "backOffices costs" some 30€
Consider that customs will make a total of MODEL + SHIPPING to calculate VAT, so EEC people will have to pay taxes on the shipping costs too!

Since VAT will be deducted on UK side, it's not a big difference, but it's important to have proper customs duclaration to avoid Import/customs duty (12% could be pretty painful on a full kit)

Last but NOT least.
USED MODELS trades, from private seller to private buyer from UK to EEC. THIS could get REALLY PAINFUL!
Private sellers cannot "deduct" VAT. Customs WILL ADD VAT atop of full declared model value PLUS shipping costs. This is some 32-34% taxes in top of the price decided. On a 3.000GBP deal this would mean another 1.000GBP for the EEC part... THAT'S PAINFUL.
Only way to reduce it is well known.... Declare a much lower price to customs and make a split payment. One "official" for the declared value (papers to be sent to customs for clearance) and one "side" payment for the difference

[Armortek]

Thanks for your post Jan, but just to make things clear for people who may misunderstand your post:

The things that you bought in January from the UK were not from Armortek, so the experience may well be different.

Our export documentation clearly shows that the products are classed as SCALE MODEL TOYS and are made in the UK. Under the agreement that the UK has with the EU, our products have no import duty.

Our sales into Europe from the 1st Jan 2021 are without VAT, so when the goods are delivered to the customer, the customer has to pay their local VAT.

To be clear, I repeat what I said earlier:

As 1st of Jan has come, sadly we enter into a new relationship with Europe.

The good news though is that we now have more clarity on what this means with regards to our EU customers. The points have been summarised below. If you are not clear on something then please let us know.

1. VAT - We will not charge any VAT on sales to the EU from the 1st Jan 2021. Instead, customers will need to pay their local VAT (- VAT (MwSt/ IVA/TWA/Moms/BTW/DPH). This will be coordinated by UPS and UPS will contact the customer directly for payment.

2. IMPORT DUTY - There will be NO IMPORT DUTY to pay.

[Jan_Donadoni]

Thanks for your post Jan, but just to make things clear for people who may misunderstand your post:

The things that you bought in January from the UK were not from Armortek, so the experience may well be different.

Our export documentation clearly shows that the products are classed as SCALE MODEL TOYS and are made in the UK. Under the agreement that the UK has with the EU, our products have no import duty.

Our sales into Europe from the 1st Jan 2021 are without VAT, so when the goods are delivered to the customer, the customer has to pay their local VAT.

To be clear, I repeat what I said earlier:

As 1st of Jan has come, sadly we enter into a new relationship with Europe.

The good news though is that we now have more clarity on what this means with regards to our EU customers. The points have been summarised below. If you are not clear on something then please let us know.

1. VAT - We will not charge any VAT on sales to the EU from the 1st Jan 2021. Instead, customers will need to pay their local VAT (- VAT (MwSt/ IVA/TWA/Moms/BTW/DPH). This will be coordinated by UPS and UPS will contact the customer directly for payment.

2. IMPORT DUTY - There will be NO IMPORT DUTY to pay.

Yes, your explanation is perfect.
No Import duty.
Crazy, but we will have to pay VAT on the shipping costs. It's not a big difference, but still a few Euro to add to our government expenses.
The BIG difference is on private sales over consumer to consumer sales. Here we will still avoid Import duty, but the customs will FOR SURE ADD VAT.
More or less everyone buying a USED tank model will have to add (buyer) 20% more or less

[Charles A Stewart]

Hello everybody.

Having had a look at the Armotek answers to the Brexit Issue, bearing in mind my recent purchase from Germany. Am I correct that to send goods to the EU, VAT is deducted?

For this purchase from Germany I had to :-
1/ Purchase a certain amount (153euro). No problem
2/ Pay German VAT.
3/ Pay UK VAT (no import duty though) and the European wide postage scam, which seems unavoidable wherever you live.
4/ I am a private customer, not a business.

My point is, is there a way that I can recover the German "VAT"?

I have contacted the vendor, but heard nowt, yet.

Take care
Charles

[Christoffer Ahlfors]

Any business doing exports should know not to add VAT on export orders. A problem in this hobby is that the vendors are typically hobbyists themselves and either don't know how or don't have the ability to do this. Such a drag!

[Gerhard Michel]

That is a little strange. If the vendor is a hobbyist he doesn't have to pay (or claim!) any VAT. If the vendor is a business man he should know how to avoid his domestic VAT.

[Armortek]

Strictly speaking, this is not a BREXIT issue - instead, in all their wisdom, HMRC decided to bring in new GLOBAL rules on the 1st Jan 2021 in an effort to get their hands on more VAT - presumably to tackle all the far eastern trade that has been benefiting at the expense of the Treasury.

Of course bringing in the new rules at the same time as BREXIT has been a wonderful experience for many and resulted in many (small) companies calling time on cross border sales.

The rules are summarised as follows - more details here: https://www.bdo.co.uk/en-gb/insights/br ... ter-brexit

Without knowing the details, it is highly likely that you have been screwed by exchange rates. The German retailer would have been right to charge VAT if the order was calculated to be less than £135 on the day of transaction ... and the UK courier would have been right to have charged VAT if the exchange rate moved and the goods were more that £135 when they were processed on the UK customs systems.
No idea how you would go about claiming on this, but HMRC thanks you for your business.

[Tim Page]

Hmmm, yet another example of how Brexit has improved all our lives.

It has got to the point now that I will not even consider purchasing any item from outside the UK.

Sad times indeed.

Tim

[graham pipe]

Hello all, not a good time now and probably forever to be buying goods from the UK with delivery to Europe. I've recently bought a sizeable amount of spares from Armortek which, of course, being a very professional business, did not include any vat. Therefore, I was obliged to pay UPS this vat plus import duty to France plus a 15 euro "admin fee" for the priviledge of having the UPS driver on my doorstep demanding payment otherwise they would not give me the parcel. I have a UPS account and apparently should not have to be hit with their fee and also should be able to pay whatever is due via my account online.

This does not seem to be working so I have to give a cheque or cash to the driver. And then 5 weeks later, they invoice me for what is owing despite having already paid. Letters and e mails then ensue to prove one's payment. Thankfully, I always get the driver to sign my own receipt document stating their name, date, amount paid and their van registration number. Would suggest this action to others receiving goods from the UK via UPS.

The only good thing is that UPS deliver super quickly - sometimes within 2 days.

I see that Armortek are opening a shop/showroom in Germany. Great! So will this mean European buyers of kits or spares can be exempt from import duty. One doubts it but can live in hope...

Best regards from Normandy

G