[CR]Clarification on the Payment of sales tax in the UK and on export.

(Example: Framebuilders:Alberto Masi)

From: <REClassicBikes@aol.com>
Date: Mon, 10 Dec 2001 04:35:01 EST
To: classicrendezvous@bikelist.org
Subject: [CR]Clarification on the Payment of sales tax in the UK and on export.

Sorry, I know this is way off topic, but I feel a general note on this matter may help many enthusiast who buy parts from the UK and stop them from getting ripped off.

Any company that is register to pay Value added tax (VAT), in the UK, (this is dependant upon the size of the companies gross turn over) should charge VAT on the sale of any goods or services within the European Economic Community, EEC, (not just the UK). Rates of taxation vary on the item being purchased.

The sale of used or second hand goods by such companies are still liable for VAT, however, if certain rules are followed, the amount of tax payable can be reduced to the tax on the profit on the resale only (only?).

This bit is of interest to US based collectors.

The sale of goods for direct export outside the EEC may be done with out VAT being required. However the seller needs certain types of proof, in order to satisfy the tax man, that the goods have been exported. This includes a written order, or fax, not email, proof of external payment, and proof of posting. (All three, not just one.)

The up shot of all this is that if you live in the US or Japan or any where out side the EEC, you should pay no UK sales tax. However, you may need to help the seller to prove that the goods are going for export.

When you are first quoted a price, check whether this includes any sales tax, and if it does, ask the seller what you can do to eliminate the need tp pay this tax. If you are told this is not possible, then start to get suspicious. It may mean the seller does not understand export rules, or is too lazy to help you. It may also mean that they are trying to make extra bucks at your expense.

Regards Martin, currently filling in a tax return, on a cold Scottish morning, Coopland