VAT on purchases from Europe?

[Liftman]

I'm curious to know if anyone in the US has experience in purchasing items from Europe? After a ton of searching I haven't found any solid info on how this works. Or the process.

Example: I'm considering an O'Three drysuit. I do tend to prefer to keep my money "in house" so to speak but these have really caught my interest.

Anyway, it seems that the VAT tax could possibly be either witheld by the store upon purchase or refunded after the transaction? How does this work? Does it depend on the individual retailer? Without the VAT it looks to be a significant savings, but are there more costs involved that I'm not aware of, aside from shipping ofcourse?

Thanks, Lift.

 

[deco_martini]

Europe isn't a country. If you were thinking about buying something from a particular country and wanted to know how VAT worked buying overseas from that country, that might help.

 

[Liftman]

Sorry it was my understanding that VAT affects all European countries and some others possibly? But to answer you question it is specifically England.

 

[JanK]

VAT is a standard tax in all European countries and one which the newcommers hav had to adopt before joining it. The rate is different in different countries (the upper and lower limits are, IIRC, set by the EU).

I remember that, before our country joined the EU, if I ordered something via mail, the seller automatically deduced (or rather, didn't add) the VAT.

But apparently the rules have changed, if the HM Revenue & Customs: VAT refunds for visitors to the UK is correct:

Goods you can claim refunds for

You can obtain VAT refunds for anything on which you pay VAT in the UK apart from the following:

* new or used cars
* a boat you plan to sail outside the EU
* goods worth more than £600 exported for business purposes
* goods to be exported as freight
* goods that need an export licence - except antiques
* unmounted gemstones
* bullion over 125g, 2.75 troy ounces or ten Tolas
* mail order goods, including Internet sales
* goods used or partly used in the EU, such as perfume
* service charges, such as hotel expenses

 

[Marek K]

I don't have references for any of this, but I lived in two European countries as a U.S. DoD civilian from 1998 to 2008 (Germany and Poland). We dealt with VAT in each of those countries on an almost-daily basis -- exemption in Germany, and after-the-fact refund in Poland. A significant cost if you're talking around 20%.

These VAT rules were based on Status-of-Forces Agreement in Germany, and on diplomatic reciprocity in Poland. But those special rules applied to us because we were actually living in those countries, but not residents.

Broadly, you're only subject to VAT if you're a resident of the EU, or for as long as you stay there. If you're a tourist, you pay the VAT to the seller and get some paperwork from them; then either get a refund at the border when you leave the EU, or apply for a refund after you get home. You have to show that your country of residence is outside the EU.

If you're living outside the EU when you buy the goods, your mailing or shipping address is generally proof of residence. You're technically not subject to VAT.

(Just like you're not generally subject to state tax if you're living outside a state where a U.S. seller does business.)

Here's where my knowledge gets fuzzy, though. There seems to be a process for the seller not to charge you the VAT in the first place -- I've ordered car parts from Germany, and the VAT wasn't charged. But that bureaucratic process is likely to be very complicated for the seller if they aren't used to doing it, and they might not be wiling to go through the hassle.

I also suspect there's a way to apply for a refund afterwards. But that would mean you'd be dealing with the EU and national bureaucracy from outside.

Best to get in contact with the seller and ask. If they want to make the sale, they'll understand your motivation to save ~20%, and be willing to do a bit of paperwork themselves.

 

[Liftman]

Interseting info. Thanks for the link aswel.

They way I understood that is items with a value over 600 euro must have the VAT added on and won't be refunded? Sounds like my next step will be to talk to the retailer. I'll update this thread with any additional info that I find.

Lift.

 

[Marek K]

They way I understood that is items with a value over 600 euro must have the VAT added on and won't be refunded?

Note that it's "goods worth more than £600 exported for business purposes." Which you wouldn't be doing; your goods would be for personal use.

JanK's link, of course, was for visitors to the UK, and doesn't cover mail ordering. But the general principles should apply.

 

[Liftman]

Note that it's "goods worth more than £600 exported for business purposes." Which you wouldn't be doing; your goods would be for personal use.

JanK's link, of course, was for visitors to the UK, and doesn't cover mail ordering. But the general principles should apply.

Gotcha. Makes sense. I wasn't too sure about the business purposes. Thank you.

 

[Saint4429]

Keep in mind that you will have to pay US Custom's Duty on the equipment. Also something to consider, most US Companies won't warranty products purchased in Europe inside the US. Meaning that you may have to pay to ship it back to the UK for the shop to have it repaired and it may be subject to import/export duty.

 

[sylpha]

HI,

as a UK citizen and a user of an O three drysuit. i suggest that you contact Othree, I would be very very surprised if you needed to return the suit for any reason although if you ordered a made to measure suit it might be a little expensive coming over for the fitting (but if you did you could get some great diving in).