VAT and international buyers...

[Timbor]

Hi folks,

Perhaps someone will enlighten me...

I have purchased many figures from UK retailers and have had the figures posted to me in Canada.  However, I have noticed different practices with regards to VAT.

From my understanding, when purchasing internationally, the purchase is exempt from VAT as it is expected that local sales taxes/duties will be levied in the buyer's country.  It also seems that prices in the UK typically show up in the webstore with VAT already included (as opposed to Canada where tax is added afterwards).

I have seen several retailers where when I select Canada as the destination, the price goes down to represent the removal of VAT.   However, some do not.  As an example, look at Gripping Beast's website - they have posted prices that list the price with and without VAT.  However, if I go to Wayland Games, and add the same product into my cart and go to the checkout, it is listed as the same retail price as the Gripping Beast website, but with VAT included.

In this case, is Wayland just charging me 20% more and pocketing the difference or what?  Am I supposed to contact them to get them to remove the VAT?  I am not trying to pick on Wayland here either... I have seen many retailers do a similar thing.

[Dewbakuk]

VAT is complicated with regards to foreign orders. In the UK all taxes are included in the price. Not necessarily VAT... A company has to have a turnover of a certain level to be VAT registered, therefore if you order from one of the smaller companies they wouldn't and couldn't remove the VAT as it isn't in the price anyway.

Now to really complicate matters, if you are outside the UK/EU, you DO NOT pay VAT. End of. Therefore, a company can lower the price by the VAT amount to represent this fact, but they are under no obligation to do so. It just means they don't have to pay that share to the government and make more profit.

How 'fair' that is is for you to decide.

[joroas]

On the other hand, we are so used to seeing prices in the UK with the tax already added, it is hard to get used to prices in the States that have tax added on afterwards.

[Dewbakuk]

Indeed, I've been caught out by that in the past.

[Modhail]

Now to really complicate matters, if you are outside the UK, you DO NOT pay VAT. End of.

Not entirely, if you charge VAT to UK customers you must charge VAT to EU customers as well. The no VAT clause only applies to trade to outside of the EU.

[Dewbakuk]

Not entirely, if you charge VAT to UK customers you must charge VAT to EU customers as well. The no VAT clause only applies to trade to outside of the EU.

Ah yes, sorry, forgot about the EU for a minute there.

[Timbor]

VAT is complicated with regards to foreign orders. In the UK all taxes are included in the price. Not necessarily VAT... A company has to have a turnover of a certain level to be VAT registered, therefore if you order from one of the smaller companies they wouldn't and couldn't remove the VAT as it isn't in the price anyway.

Now to really complicate matters, if you are outside the UK/EU, you DO NOT pay VAT. End of. Therefore, a company can lower the price by the VAT amount to represent this fact, but they are under no obligation to do so. It just means they don't have to pay that share to the government and make more profit.

How 'fair' that is is for you to decide.

Hmm, that does not seem fair at all, especially considering the 25% or more that many of the sellers charge for shipping, and I may have to pay taxes once the item arrives in my country. 

Luckily for me Canada Post is not that diligent at charging customs and taxes on most parcels.  Still makes me feel like I am getting ripped off.  At least Wayland Games offers discounts and free shipping on larger orders.

[General M@yhem]

I had a long drawn out argument with Wayland about the VAT issue about 18 months ago. At that time , on their website they said they would deduct VAT if I contacted them direct. I did and was told by a friendly individual that there was no problem and to e-mail my order and they'd bill me, minus VAt. I did this and then got another e-mail saying they now couldn't do that. Very quickly, the section on the Wayland website that talked of deducting VAT, was removed. I phoned them and they explained to me that the profit they made on the VAT was swallowed up in shipping subsidies for the items I wanted.So the VAT I 'saved' was used to ship me my stuff at a cheaper rate. I live in the Channel Islands which , postage wise, is very similar to mainland UK, so their argument was a bit naff. In the end, they stood firm and refused to deduct the VAT but couldn't give me a particularly good reason.