Customs & VAT query on goods from the USA

podge3

Dunno if this is the right forum but here goes...

I got a package from the US this morning. The sender marked the item as a "gift" with a value of $180. The Revenue site says the following:

Customs duty and VAT is not payable on consignments of a value not exceeding €45 which are sent as gifts by private individuals from third countries for the personal or family use of private individuals in the State. However, relief from VAT does not apply in the case of tobacco products, alcohol/alcoholic beverages perfumes or toilet waters and the limits set out in Public Notice No. 1179 relating to relief from customs duty on such goods must be observed. Furthermore, where after excluding the value of the goods (other than tobacco products) which qualified for the relief (€45), the total value of the remainder of the dutiable goods in a gift consignment does not exceed €349.18, customs duty will be charged on the balance at the standard rate of 3.5%. The importer may, however, opt to have the goods charged at the relevant tariff rate(s) applicable. VAT and excise duty, if chargeable, will be assessed in the normal way

I assumed, therefore, that the first €45 was exempt from VAT and duty. My package was charged VAT on the full amount, however. Is this correct?

acquiescefc

Did they charge you 3.5% on USD180 then?

Im waiting for something similar and im hoping they marked it as USD100 value so 3.5 bucks wouldnt be too bad.

mcgovern

Not sure if its right but I've always been charged on the full amount.

Beano

items below €45 are exempt but items above this are charged at their full value. Just be careful they dont try and charge you duty and vat on €180. Out of curiosity how much are they looking for?

podge3

Beano wrote: »

items below €45 are exempt but items above this are charged at their full value. Just be careful they dont try and charge you duty and vat on €180. Out of curiosity how much are they looking for?

No, they didn't charge me any duty at all, just VAT on the full declared amount plus postage i.e. $180 plus $65 - total $245/€170 approx.

Total fees were 21% of €170 (€35) plus €5 collection charge, so a total of €40 approx.

I just thought the first €45 was exempt from VAT, but it seems I was wrong

podge3

acquiescefc wrote: »

Did they charge you 3.5% on USD180 then?

Im waiting for something similar and im hoping they marked it as USD100 value so 3.5 bucks wouldnt be too bad.

You should be caught for about €19.50

Beano

podge3 wrote: »

No, they didn't charge me any duty at all, just VAT on the full declared amount plus postage i.e. $180 plus $65 - total $245/€170 approx.

Total fees were 21% of €170 (€35) plus €5 collection charge, so a total of €40 approx.

I just thought the first €45 was exempt from VAT, but it seems I was wrong

sounds about right.

Soarer

podge3 wrote: »

No, they didn't charge me any duty at all, just VAT on the full declared amount plus postage i.e. $180 plus $65 - total $245/€170 approx.

Total fees were 21% of €170 (€35) plus €5 collection charge, so a total of €40 approx.

I just thought the first €45 was exempt from VAT, but it seems I was wrong

That certainly doesn't equate to what's said in the red part above.

From what I can tell from above, the first €45 is tax free, and the remainder of the value on the package is charged at 3.5%. VAT and/or duty to be charged at the normal rate on the postage.

Ro-76

I assume that the €45 threshold is a cut-off point, so that anything under that is OK, but over that the total price is liable for VAT, like stamp duty.

The real killer IMO is the inclusion of the shipping cost, which is charged at the Irish rates, so even if you buy from a merchant who has a discount setup with Fedex for example, and only charges you $10, the reveune calculate the VAT based on the cost of sending the package from Ireland, which is always more expensive. This means that almost everything is over the €45 level, and since FedEx charge an additional fee for collecting the VAT, there's an incentive to charge the customer often as possible.

Beano

Ro-76 wrote: »

...
The real killer IMO is the inclusion of the shipping cost, which is charged at the Irish rates, so even if you buy from a merchant who has a discount setup with Fedex for example, and only charges you $10, the reveune calculate the VAT based on the cost of sending the package from Ireland, which is always more expensive. This means that almost everything is over the €45 level, and since FedEx charge an additional fee for collecting the VAT, there's an incentive to charge the customer often as possible.

You're going to have to explain this further. Are you saying that the revenue use the cost of shipping the package from Ireland back to the country of origin? Having paid duty on dozens of parcels I can tell you this is not the case. The shipping cost used to calculate duty and vat is the shipping cost declared on the parcel.

Linoge

Ro-76 wrote: »

The real killer IMO is the inclusion of the shipping cost, which is charged at the Irish rates, so even if you buy from a merchant who has a discount setup with Fedex for example, and only charges you $10, the reveune calculate the VAT based on the cost of sending the package from Ireland, which is always more expensive. This means that almost everything is over the €45 level, and since FedEx charge an additional fee for collecting the VAT, there's an incentive to charge the customer often as possible.

Could you explain this a bit more? Why are would the revenue calculate shipping cost?

Are you saying that VAT should only be charged on the shipping cost and they estimate how much this is?

AFAIK VAT is charged on the marked value of the item. If this price includes the postage costs then thats the sellers mistake, but I certainly have never heard of the revenue calculating postage costs and applying VAT to it??

Beano

Linoge wrote: »

Could you explain this a bit more? Why are would the revenue calculate shipping cost?

Are you saying that VAT should only be charged on the shipping cost and they estimate how much this is?

AFAIK VAT is charged on the marked value of the item. If this price includes the postage costs then thats the sellers mistake, but I certainly have never heard of the revenue calculating postage costs and applying VAT to it??

Vat and duty are calculated on the cost of the item + the shipping cost.

Scruff

got a parcel from the states with contents value of $108 declared on it. Had to pay €37ish import duty etc.
Still worked about €150 cheaper that here

podge3

Beano wrote: »

Vat and duty are calculated on the cost of the item + the shipping cost.

Unfortunately that is true.

podge3

Scruff wrote: »

got a parcel from the states with contents value of $108 declared on it. Had to pay €37ish import duty etc.

Probably included postage costs.

Also, who delivered the package? An post only charge €5 collection, but most couriers charge €20/30. Always use USPS/EMS if possible.

podge3

Ro-76 wrote: »

I assume that the €45 threshold is a cut-off point, so that anything under that is OK, but over that the total price is liable for VAT, like stamp duty.

If this is the case, then its pointless having the item marked as a gift once the value is over €45


edit: just realised Boards has multiquote - sorry!!

mcgovern

podge3 wrote: »

If this is the case, then its pointless having the item marked as a gift once the value is over €45


edit: just realised Boards has multiquote - sorry!!

Thats always been the case, and it can in fact draw more attention to the item.

Soarer

I find that if you can get the item delivered to your place of work, it doesn't get caught.

Well, I've never been caught anyway!
Talk about jinxing myself!!:rolleyes:

The_Conductor

Soarer wrote:

I find that if you can get the item delivered to your place of work, it doesn't get caught.

Well, I've never been caught anyway!
Talk about jinxing myself!!:rolleyes:

I've had it delivered to work (a government department) and had to pay duty several times (and sometimes got away without paying anything).

Last thing I got charged VAT and duty on was CSI Miami Seasons 1-4. It cost $148, I got charged Euro 73 VAT and Duty.

The C&E staff do have discretionary powers to open packages and put their own value on goods, if they're not satisfied with the declared contents and value. Its never happened to me though.

S.

Ro-76

Beano wrote: »

You're going to have to explain this further. Are you saying that the revenue use the cost of shipping the package from Ireland back to the country of origin? Having paid duty on dozens of parcels I can tell you this is not the case. The shipping cost used to calculate duty and vat is the shipping cost declared on the parcel.

If the shipping cost is not listed on the label, as is frequently the case with non-postal services like FedEx or UPS, then the estimated shipping cost is based on Irish FedEx/UPS rates.

throwingmuses

I ordered my wedding dress from the US 2 years ago along with 3 bridesmaids dresses and a wedding cake stand (3 separate orders, 3 separate states). I didn't get charged anything on any of the orders. I don't understand how I got away with it from reading all of the above posts.

I was so naieve I didn't even know you were supposed to pay any duty so as I say can't understand how I wasn't charged at all.

Ideo

smccarrick wrote: »

Last thing I got charged VAT and duty on was CSI Miami Seasons 1-4. It cost $148, I got charged Euro 73 VAT and Duty.
S.

How did that work out? should it not be $148 plus p&p @ 21%?

BarryM

podge3 wrote: »

Probably included postage costs.

Also, who delivered the package? An post only charge €5 collection, but most couriers charge €20/30. Always use USPS/EMS if possible.

A little off the point but in my experience there is an outfit called GLS, who appear to be the US Postal Service agent in Ireland for parcels. I've had various run-ins with them. Most US shippers are unaware of this and think that if they send it US PO then it is delivered by Irish PO. In my experience GLS charge on everything and then add the VAT!!! I assume they are the 'agent' also for the revenue.....handy cash flow addition......

Of course with the €/$ rate as it is then even the hassle of duty and VAT is worht it in many cases.

ciaran76

BarryM wrote: »

A little off the point but in my experience there is an outfit called GLS, who appear to be the US Postal Service agent in Ireland for parcels. I've had various run-ins with them. Most US shippers are unaware of this and think that if they send it US PO then it is delivered by Irish PO. In my experience GLS charge on everything and then add the VAT!!! I assume they are the 'agent' also for the revenue.....handy cash flow addition......

Of course with the €/$ rate as it is then even the hassle of duty and VAT is worht it in many cases.

I though GLS lost this contract 2 years ago ? UPS or something does it now ?

rubadub

Posted At: 28 November 2006 18:51
Posted To: Customs Reliefs
Conversation: Duty on mail order goods.
Subject: Duty on mail order goods.


*************************************

This e-mail has been received by the Revenue Internet e-mail service.

*************************************

Hello,
I was reading on revenue.ie which stated

"Consignments not exceeding a value of €22 may be imported from
outside the EC without payment of import charges."

Does this €22 include the price of the postage? i.e. I am looking to
get a DVD from the US, the DVD is only valued at $5 but express
delivery is $45, so would I be charged duty on this?

Thanks

the reply

Good morning,

Please see the attached leaflets.

I can confirm the value for Customs purposes is the CIF price, Cost,
Insurance and Freight.

If there is anything further please get back to me.

Regards,


Customs
Office of the Revenue Commissioners
Nenagh
Co. Tipperary

The attachments

Leaflets & Guides



Notice by the Revenue Commissioners
Notice No. 1882 - Ordering Goods over the Internet or from Mail Order Catalogues


1. General

This Notice is a brief guide for persons who are considering buying goods either over the Internet or from mail order catalogues.


2. Liability to Customs Duty, Excise Duty and Value-Added Tax

Import charges (customs duties, anti-dumping, countervailing and excise duties where applicable and VAT) are payable on goods purchased over the Internet or from mail order catalogues and imported into Ireland from outside the European Community (EC). In the case of excisable products (alcohol and alcoholic beverages, tobacco and tobacco products and mineral oils) forwarded from other Member States of the EC, excise duty and VAT are chargeable.


3. Basis on which Duty is Calculated

Customs Duty:
The value of the goods for the purposes of charging customs duty is calculated on the price paid or payable for the goods plus the cost of transport (including postage), insurance and any loading or handling charges associated with the delivery of the goods into the EC. The rate of customs duty applicable can vary and depends on the nature of the goods being imported. Further information on rates of duty can be obtained by accessing Part 4 of the Customs and Excise Tariff of Ireland or Taric.


Excise Duty:
Different rates of excise duty apply to each category of excisable product. Information on the current rates of excise duty chargeable on excisable products are available in Part 5 of the Customs and Excise Tariff of Ireland or from your Local Revenue Office


Value-Added Tax:
Imported goods are liable to VAT at the same rate as applies to the sale within the State of similar goods. The value of the goods for the purpose of VAT is their value for customs purposes, described above, increased by the amount of any duty or other tax (but not including VAT) payable and any other transport, handling or insurance costs between entry into the EC and delivery to their final destination.




4. Consignments of Negligible Value

Consignments not exceeding a value of €22 may be imported from outside the EC without payment of import charges. However, this relief does not apply to importations of tobacco, tobacco products, alcoholic products, undenatured perfumes or toilet waters.



5. Procedure at Importation

On importation from outside the EC, the goods must be presented to Revenue and Revenue formalities completed, including payment of all duties / taxes.


6. Goods Prohibited/Restricted

Certain goods are prohibited from being brought into the State under any circumstances; certain other goods are restricted i.e. they may only be brought in under an import licence issued by the appropriate authorities

here; in some cases, goods being imported under licence may be subject to a quota limitation. The principal items subject to prohibition / restriction are firearms, ammunition, explosives, dangerous drugs, indecent or

obscene publications and meat or meat products. A full list of prohibited or restricted items is contained in Part 2 of the Customs and Excise Tariff.


7. Further Information

Information on the liability to pay excise duties and VAT on excisable products ordered over the Internet or from mail order catalogues, from EC Member States, may be obtained from:

Public Notice No. 1879 “Unaccompanied Import of Excisable Products from EU Member States for Personal Use” and

Public Notice No. 1880 “Import of Excisable Products from EU Member States for Commercial Purposes”.


Further information may be obtained from:

Transit & Reliefs Unit,
Customs Division,
Customs Procedures,
Government Offices,
Nenagh,
Co. Tipperary


E-mail: customsreliefs@revenue.ie


Notice No. 1882

August 2006 Edition

Leaflets & Guides



Notice by the Revenue Commissioners
Notice No. 1179 - Customs Duty and VAT at Importation
Guide to Reliefs available for the import from non-EC countries of:

- Consignments of Negligible Value, and

- Gift Consignments

1. INTRODUCTION

When goods are imported into, or received in, Ireland from a country outside the European Community (E.C.) they are liable to import charges (Customs Duty, Anti-Dumping, Countervailing and Excise Duties where applicable and VAT) at the point of importation. However, in the case of:

- consignments of negligible value which are imported by a person resident in Ireland;

and

- gift consignments which are received by a person resident in Ireland

a certain amount of relief is available from these charges. This Guide outlines the relief available, how it may be obtained and the procedures which apply in order to obtain it.

It is important to note that there are separate reliefs available for travellers who wish to import goods with them on return from abroad and these differ from those described below. Full details of reliefs for travellers are set out in Leaflet PN 1878.

>> Back to top


2. Consignments of Negligible Value

Consignments not exceeding a total value of €22 may be imported without payment of Customs Duty and VAT. However, there is no relief for importations of tobacco, tobacco products, alcoholic products, perfumes or toilet waters irrespective of their value.



3. Gift Consignments

Relief from payment of Customs Duty and VAT is allowed on gift consignments from outside of the E.C. where the following conditions are met:

The value of the gift does not exceed €45.
The gift is correctly declared (see paragraph 7).
It has been sent from a private person abroad to another person within the E.C.
The gift is for the personal or family use of a private individual in Ireland.
There is no commercial or trade element i.e. the goods have not been paid for.
Alcohol, Tobacco products, perfumes or toilet waters are within the allowances set out in paragraph 4. Anything over those allowances is liable to charges.
The gift is of an occasional nature only, such as a birthday or anniversary.
>> Back to top



4. GIFT CONSIGNMENTS OF TOBACCO PRODUCTS, ALCOHOL, PERFUME AND TOILET WATERS

Relief from Customs Duty is allowed on gift consignments of Alcohol, Tobacco products, perfume and toilet waters. However, to qualify for relief, such consignments must comply with the conditions set out in paragraph 3 and be within the following allowances:



Type of Goods Allowances
Tobacco Products 50 cigarettes; or
25 cigarillos (cigars with a maximum individual weight of 3 gms); or
10 cigars; or
50 gms of tobacco; or
a proportional assortment of the different products.

Alcohol 1 litre of distilled beverages and spirits over 22% volume; or
1 litre of fortified or sparkling wine, and some liqueurs of 22% volume or less; and
2 litres of still wines.

Perfume and toilet waters 50 gms of perfume; or
0.25 litres of toilet water.


















It is important to be aware that there is no relief from VAT or Excise duty on the above products, irrespective of their value.




>> Back to top

5. HOW VARIOUS TYPES OF DUTY, CHARGEABLE AT IMPORTATION, ARE CALCULATED

The rate and type of duty charged will depend on the type of goods being imported and will include one or more of the following:


Type of Duty Description
Customs Duty This is normally charged as a percentage of the value. The percentage varies depending on the type of goods and their country of origin. Duty is charged on the price paid for the goods including any local sales taxes plus postage, packing and insurance costs. Further information on rates of duty can be obtained from Part 4 of the Customs and Excise Tariff of Ireland or Taric or by e-mailing tarclass@revenue.ie


Excise Duty This is charged on alcohol and tobacco products and is in addition to Customs Duty. The Excise Duty on wines and spirits depends on the volume of alcohol and whether wine is still or sparkling. Excise Duty on cigarettes is based on a percentage of the recommended retail price combined with a quantity charge whilst that on other tobacco products is based on the net weight. Information on the current rates of Excise Duty are available in Part 5 of the Customs and Excise Tariff of Ireland


Value Added Tax VAT at the point of importation is charged at the same rate that applies to similar goods sold in this country. The value of the goods for the purpose of calculating the amount of VAT payable at import is their value for customs purposes, described above, increased by the amount of any duty or other tax (but not including VAT) payable. Further information can be obtained from your Local Revenue Office. Alternatively, a detailed list of VAT rates are available here.



>> Back to top



6. Rate of Customs Duty Applicable

Where a consignment consists of two or more items of an aggregate value exceeding €45, relief will still be given for those items the total value of which does not exceed this amount. However, it is important to understand that the value of an individual item cannot be split up.


Where the value of a gift consignment containing more than one item falls between €45 and €350, a flat rate of 3.5% customs duty may be applied. The importer may, however, opt to have the goods charged at the relevant tariff rate(s) applicable. The table below provides a number of illustrative examples:


No. And Value of Items Duties payable on importation
One item valued at €45 Relief granted on total amount.
One item valued at €55 Customs Duty (normal rate or 3.5% flat rate) and VAT payable on total amount.
Five items valued at €10 each Four items relieved in full. One item subject to Customs Duty (normal rate or 3.5% flat rate) and VAT on its full value (in this case, €10).
One item valued at €400 Customs Duty and VAT payable on full amount at the normal rate of duty.

This provision does not apply to tobacco products, alcohol or perfume and toilet waters. In such cases, VAT and Excise duty will be assessed in the normal manner.


7. Procedure at Importation

The Customs Declaration Form on the relative parcel, if sent by post, should be marked “Gift” in addition to giving the details normally required. If imported otherwise than by post, the goods should be declared as a gift at importation on the Customs Entry (SAD).


8. Further Information


Further information may be obtained from:

Transit & Relief's Unit,
Customs Division,
Customs Procedures,
Government Offices,
Nenagh,
Co. Tipperary


E-mail: customsreliefs@revenue.ie


Notice No. 1179

August 2006 Edition

Beano

BarryM wrote: »

A little off the point but in my experience there is an outfit called GLS, who appear to be the US Postal Service agent in Ireland for parcels. I've had various run-ins with them. Most US shippers are unaware of this and think that if they send it US PO then it is delivered by Irish PO. In my experience GLS charge on everything and then add the VAT!!! I assume they are the 'agent' also for the revenue.....handy cash flow addition......

Of course with the €/$ rate as it is then even the hassle of duty and VAT is worht it in many cases.

As somebody else said GLS lost this contract 2 years ago after a string of complaints. A lot of them from me. All usps parcels are now handled by An Post in Ireland. People complain a lot about An Post but they provide a much better service than most courier companies and certainly a lot better than GLS ever did.

BarryM

ciaran76 wrote: »

I though GLS lost this contract 2 years ago ? UPS or something does it now ?

Could be, I haven't had to deal with them for a while I'm not the least surprised they lost it!!

So, USPS is now represented (again) by An Post, so it is better (cheaper?) to specify USPS when you have the choice??

I appreciate this is off topic but it does affect bargain buying......

Bye, Barry

Tazz T

Agreed. I've had several run-ins when they simply didn't deliver because they couldn't find my address despite my phone number on the package.

It's mad to think that they charge so much more.

At least with An Post you'll get it eventually.

ixoy

How does it work with mixed goods? For example, I recently got a parcel off of Amazon.com that contained DVDs (VAT @ 21%) and books (no VAT). Do they go to the trouble of opening the package and totalling up the individual VAT items or do they just apply it as a lump sum, in which case they're pretty much illegally taking VAT from a shipment.

BarryM

ixoy wrote: »

How does it work with mixed goods? For example, I recently got a parcel off of Amazon.com that contained DVDs (VAT @ 21%) and books (no VAT). Do they go to the trouble of opening the package and totalling up the individual VAT items or do they just apply it as a lump sum, in which case they're pretty much illegally taking VAT from a shipment.

How much did they charge?? I'm sure they don't open them.... (or at least not unless they think it is a gun...:)) As it says in the leaflet above it is the CIF price. Did Amazon have total cost info on the parcel? I think they tend to deliver 'locally' to avoid duty, etc., much like CD-Wow!

Bye, Barry

The_Conductor

I believe postage is also VAT exempt (correct me if I'm wrong......)

S.