Does EU-Korea FTA mean no import duties?

Gotham

I want to buy a computer monitor directly from Korea.
They price at around 300 euro.

I understand there is an EU FTA with Korea, but does it essentially mean that I wont have to pay a massive import duty? Does this affect VAT?

I see mixed and confusing statements about it.
This chart doesn't even include Ireland:
http://en.wikipedia.org/wiki/Free_trade_areas_in_Europe

None of these articles explicitly specify that Import Duty is reduced:
http://www.bbc.co.uk/news/business-13289640
http://www.irishexporters.ie/section/EUSouthKoreaFreeTradeAgreementFTA

RUDOLF289

The rate of duty for (LCD) Monitors is 14%. If goods are bought in South Korea, under the FTA between the EU and Korea the import duty is reduced to 9.3%.

Be aware that the duty payable is calculated over the purchase price, plus the freight cost. The VAT (@ 23%) is charged over the combined total plus the duty

Hope this helps

Cheers,
Rudolf289

Solair

Check the TARIC code website:

http://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en

Always a good place to start for import/export duties payable.

Solair

Here's the TARIC code that would seem to apply although you might want to recheck:

http://ec.europa.eu/taxation_customs/dds2/taric/measures.jsp?Lang=en&SimDate=20120906&Area=KR&Taric=8528594020&LangDescr=en

They're very specific about the voltage and stuff.

There's also more info here :

http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1080276995&type=RESOURCES
It's UK-specific, but the same TARIC codes apply across the whole EU.
Just look up the codes on that UK site on the EU site posted above and you should be able to figure it out.

Solair

Revenue are actually very helpful on these things too btw.

You can contact them :

http://www.revenue.ie/en/contact/customs-division.html

and they're usually very happy to explain how it works and figure out which codes apply to which item.

I've gone through it with them a few times for various goods we wanted to import from outside the EU and they were really helpful.

They do a job and are very much not 'out to get ya'. However, just be careful that the shipping company doesn't get the codes wrong / over charge you for it. We had issues where they'd misclassified items due to ambiguous shipping labels.

I'd actually get the exporter to write EU TARIC CODE XXXXX applicable.

Gotham

Thank you RUDOLF289 and Solair.
Very helpful info.

Those specifics worry me, that's for a 13" screen, I'm looking for a 27" inch screen. That site has the worst navigation ever! I'll see if I find what I'm looking for there.

Lets assume It's the one that you linked, does the math work like this?:

Product Price: 316
Shipping Fee: 123

(316+123)*1.093 = 450.439
450.439*1.23 = 554.039

Also, I understand if I were to get my employer to buy this through work I could avoid the VAT, but would that also avoid import duty? (Not being scabby, just curious).

Solair wrote: »

I'd actually get the exporter to write EU TARIC CODE XXXXX applicable.

Great advice! Thank you.


Thanks again for the info.

dudara

I have deleted all off-topic and unhelpful posts.

@aganica - if you don't think a post is helpful, then please elaborate why. Otherwise, don't bother posting.

Other posters - instead of feeding unhelpful posters, please use the Report Post function and leave them well alone.

dudara

Aganica

dudara wrote: »

I have deleted all off-topic and unhelpful posts.

@aganica - if you don't think a post is helpful, then please elaborate why. Otherwise, don't bother posting.

Other posters - instead of feeding unhelpful posters, please use the Report Post function and leave them well alone.

dudara

dudara

Aganica was clearly cruising for a bruising, so I have obliged by issuing a one week ban

dudara

Solair

Gotham wrote: »

Thank you RUDOLF289 and Solair.
Very helpful info.

Those specifics worry me, that's for a 13" screen, I'm looking for a 27" inch screen. That site has the worst navigation ever! I'll see if I find what I'm looking for there.

Lets assume It's the one that you linked, does the math work like this?:

Product Price: 316
Shipping Fee: 123

(316+123)*1.093 = 450.439
450.439*1.23 = 554.039

Also, I understand if I were to get my employer to buy this through work I could avoid the VAT, but would that also avoid import duty? (Not being scabby, just curious).




Great advice! Thank you.


Thanks again for the info.

I don't think you have to include the shipping fee as it's a service rather than the product itself which would be subject to a much higher tax rate as IT equipment/electronics.
(Although, you might need to clarify that with Revenue).

smeharg

Gotham wrote: »

...

Also, I understand if I were to get my employer to buy this through work I could avoid the VAT, but would that also avoid import duty? (Not being scabby, just curious).
...

Your employer would then have to charge you VAT.

Solair

smeharg wrote: »

You're employer would then have to charge you VAT.

Yeah, as otherwise the goods would have been imported for the employer's use and wouldn't be yours unless they sold them to you.
However, it would be legitimate if your employer were importing this item for you to use in a work context to do actual work.

RUDOLF289

Solair wrote: »

I don't think you have to include the shipping fee as it's a service rather than the product itself which would be subject to a much higher tax rate as IT equipment/electronics.
(Although, you might need to clarify that with Revenue).

I refer to the attached document, page 15 "Additional charges". 6.1 refers to transport costs. The whole document explains what has to be included in the Customs Value over which the duty is calculated. It is very clear that the transport costs have to be included in the value for duty.

NB : The value for customs duty purposes is the CIF (Cost Insurance Freight) EU border price. For instance, for seafreight the cost upto the transhipment point (usually Rotterdam) is to be included. In case of airfreight only a percentage of the airfreight cost (e.g. China 70%, Korea 83%) has to be included in the value for duty.

At the risk of showing my age, have been doing customs entries since 1978 ......

Cheers,
Rudolf289

Gotham

RUDOLF289 wrote: »

In case of airfreight only a percentage of the airfreight cost (e.g. China 70%, Korea 83%) has to be included in the value for duty.

Does this mean duty is on 83% of the shipping cost?
So that it's 0.83*0.093 = (7.1%) for the shipping and (9.3%) for the monitor?

Solair wrote: »

However, it would be legitimate if your employer were importing this item for you to use in a work context to do actual work.

I'm a software developer and I occasionally work from home, I might be able to do this safely since I already get paid broadband expenses.

RUDOLF289

Gotham wrote: »

Does this mean duty is on 83% of the shipping cost?
So that it's 0.83*0.093 = (7.1%) for the shipping and (9.3%) for the monitor?



I'm a software developer and I occasionally work from home, I might be able to do this safely since I already get paid broadband expenses.

Have sent you a PM

Cheers,
Rudolf289

Solair

What will normally happen if you import the item is that the exporter will declare the value and the shipping agent will hold it until duties are paid.

The shipping agent will typically collect the tariffs / duties / VAT etc owed + transaction fee.

So, normally you'll just get an invoice from UPS, DHL, FedEx or An Post or whoever.
You will only generally hear directly from Customs if there's some kind of issue with contraband or something weird.

You need to have your own calculation of the exact rates though as it's not unheard of for shipping agents to get it wrong or apply the wrong rate.

RUDOLF289

Solair wrote: »

What will normally happen if you import the item is that the exporter will declare the value and the shipping agent will hold it until duties are paid.

The shipping agent will typically collect the tariffs / duties / VAT etc owed + transaction fee.

So, normally you'll just get an invoice from UPS, DHL, FedEx or An Post or whoever.
You will only generally hear directly from Customs if there's some kind of issue with contraband or something weird.

You need to have your own calculation of the exact rates though as it's not unheard of for shipping agents to get it wrong or apply the wrong rate.

It is important to realise that ultimately the consignee is responsible for making the correct declaration, i.e. putting the agent who makes the declaration to customs in the position to make the correct declaration.

Especially for infrequent importers this may be a challenge and the tendency is to leave it to the "experts". Just be aware that the agent submitting the customs entry to customs does so on behalf (and for account / risk) of the importer. Also, he does not know your product, often he is looking at some obscure wording on the accompanying documents that may or may not consists of numbers and generic product names.

It therefore is indeed important to inform yourself and issue correct instructions. As already outlined in this thread, there are various sources of help available.

For an overview have a look at the attached document. It may assist starting importers (or exporters) with some advice.

Cheers,
Rudolf289

Solair

Yeah, I'd agree all it takes is someone to call something by the wrong terminology and it ends up in the wrong tax category!

Mistranslation or generalisations or lack of specific info can do it.

Gotham

RUDOLF289 wrote: »

Have sent you a PM

Cheers,
Rudolf289

Thanks again for the breakdown, you've been incredibly helpful.

I really feel stung by these charges, especially when I see that VAT needs to be applied directly to import duty itself. It's essentially a tax on a tax.

Gotham

Actually, I just got a call from Revenue.ie there now from their tarclass divison.
I gave them details on the monitor and they gave me this code: 8528510090 and said that the import duty was 0%!
She was making sure that it was for a desktop office computer and not something for a factory line.

http://ec.europa.eu/taxation_customs/dds2/taric/measures.jsp?Lang=en&SimDate=20120906&Taric=8528510090&LangDescr=en

That's it there, I'm pretty astonished...

Solair

Cool!

They're actually always very helpful in my experience of them.