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VAT on silver coins


sixgun

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As the prospect of the UK leaving the European Union may potentially happen, albeit remote in my opinion, a number of members have asked questions about having to pay 20% VAT on imported silver coins from the likes of goldsilver.be. There is customs legislation where silver coins which are ''collectors' items of numismatic interest' are charged 5% VAT and not 20%. As no VAT should be charged on coins exported from Europe to a post Brexit UK, if 5% VAT were charged by HMRC it should mean less than 5% total VAT was levied on the silver coins. So it need not be the end of the world. 

With this in mind i have sent an email to goldsilver.be asking in principle if they would be prepared to help UK silver coin buyers importing silver coins by filling out the customs declaration form correctly. Clearly dealers who did help coins buyers would get most of the business so it is potentially a win win situation. i picked out goldsilver.be b/c i have had a number of conversations with them in the past and they are one of the most popular silver coin dealers used here.

i hope to get a reply in a few days and we will see if they understand what i am saying and are interested in helping us. It really would not be any extra work once they have the correct customs code and declaration wording.

This is only the start but i think when all the work is done there should be a sticky thread about the issue of importing silver coins and making sure the correct VAT rate is charged in a post Brexit world [if that ever happens].

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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We'll be all wiped out be Fukushima (and/or desperately fleeing to the Middle East and Africa, if they'll have us - after all we've treated them so well over the years!) well before any fake 'Brexit' that was set up in advance to double (or triple) play us all kicks in.

On a brighter note though, there's a part of a previously never seen before ('charidee') episode of Only Fools and Horses airing this week I think on UK something or other :)

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This is an interesting thread from another forum that is worth reading even though it is quite long. By the sounds of it the guy was having success by just not giving up and he mentioned prepayment of the VAT to simplify the process but then the thread falls dead. i think the pirates can be made to follow their own rules and if it is possible to prepay 5% UK VAT minus EU VAT on the dealer's profit at least with a few of the popular EU dealers this need not be such a trauma. Personally i will have silver sent to an EU address and silver bought in the UK sent to a UK address. I am just doing this because i am just doing this. 

http://www.predecimal.com/forum/topic/8011-importation-vat-on-numismatic-coins-into-the-uk-is-not-20/

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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i got a very nice email from David at goldsilver.be. 

Now having read the post last night by Sovereign Steve about the reply he had received from Perth Mint about Harmonisation System Codes and that virtually none of the silver coins we collect are recognised as being covered for 5% VAT i was getting dismayed. [pdf document attached]

i then got the email from goldsilver.be.

I suspect they do a lot of business with the UK and it cannot afford to lose these customers. These are the emails from last night.

My email to goldsilver.be

Quote

 

To Goldsilver.be

i am a member of The Silver Forum website. 

http://thesilverforumcom

Members of the Silver Forum make a group purchase of coins from your company and i have made a number of orders in the past. i expect many €1000's worth of coins are bought each year from you. 

Most serious collectors of silver coins in the UK buy their coins from EU dealers who use the marginal rate scheme and so charge much lower amounts of VAT. 

The UK may leave the EU at some point and UK members of the Silver Forum may no longer be able to buy coins at lower VAT rates as when they are imported into the UK they will be charged 20% VAT. At that point it may no longer be worthwhile buying coins from companies like goldsilver.be as it will be as cheap or even cheaper to buy from UK dealers.

There is UK  legislation where silver coins which are ''collectors' items of numismatic interest' are charged 5% VAT when imported and not 20% VAT. This could mean that silver coins bought from goldsilver.be will remain at good prices for us in the UK.

What is important is that the correct customs declaration is made by the dealers sending the silver coins. As long as coins are declared as being silver coins which are ''collectors' items of numismatic interest' the customs should only charge 5% VAT and if they charge 20% the excess VAT can be reclaimed. 

i am making inquires now so that members of the Silver Forum know what to do if the UK does leave the EU and VAT at 20% may be charged on silver coins imported from Europe. 

I could send you all the necessary information to complete a customs declaration with the correct customs code. If the UK does leave the EU and all packages sent to the UK had declaration forms stating the contents were silver coins which  were ''collectors' items of numismatic interest' that would be very helpful. Clearly coin dealers who helped UK silver coin buyers in avoiding and reclaiming VAT would get the most business. 

So my question is, if the UK leaves the EU would goldsilver.be be prepared to assist UK buyers in the process of getting the lowest VAT rates charged?

Thank-you for your help.

 

 

 

The reply from goldsilver.be

Quote

 

Hello 

No need to remind our country is the capital of the soft dictatorship called EU, a sinking ship the UK is so lucky to leave.

People in your country will find out very soon the Brexit was the right choice. A historical decision not only for democracy but also for wealth. History shows more freedom always leads to more prosperity. 

GOLDSILVER.BE needs to sell more than several 1000's € of coins to be viable, I'm afraid. Reason why we need to work in full respect of national and international regulations. Our lawyer provides us with all necessary legal advice to avoid any kind of issue both to our company as our customers.

We are ready for the day the UK leaves the EU and know how to fill in the customs declaration and which forms to use. Furthermore we are also ready to assist our customers who have issues with dishonest customs agents , as this may happen from time to time. Just as we do today for our customers from outside the EU. Norway,  Russia,  Dubai or Switzerland for example.

I hope my email makes you confident GOLDSILVER.BE cares for our much appreciated customers in the UK.

Best regards, 

David 

GOLDSILVER.BE 

 

 

So according to David at goldsilver.be they have everything in hand and know how to help customers get passed dishonest customs agents and incompetent ones as well no doubt. i also thought it is very interesting to see how he thinks coming out of the EU was the right thing to do. The general public who are out of their teens and early 20's in the UK also knows it is the right thing even though the controlled media is constantly telling them it isn't.  

HTISC2002 S21_1.pdf

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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@chardlizzie as you are the most active dealer on the website i would like to ask you as a UK dealer about VAT.

As you will be aware dealers of silver coins in a number of EU states apply the marginal rate scheme to new silver coins. Many buyers of silver coins in the UK buy from these dealers b/c the prices they charge are lower than elsewhere. From the email above by David at goldsilver.be it is clear the lower VAT on silver coins is a crucial part of their business strategy. It would appear they take legal advice to ensure they can stay competitive. i get the impression they are selling low VAT coins into non-EU countries.

Why is it that UK dealers do not or cannot apply the marginal rate scheme to silver coins as dealers like goldsilver.be do?

Is this something special about the VAT regimes in some other EU states?

 

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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1 hour ago, Oldun said:

The way forward would be to join in 100% with the Belt and Road. Few if any of our influential politicians are actually working for us but if they were this would be the way forward. The EU was always designed to destroy Europe and her indigenous people. This is exactly what it is doing and the controlled media keeps on covering it up. If the BBC were not the propaganda arm of the despotic elite it would be exposing the truth about this One World government slave state 24/7 and no-one outside of an insane asylum would promote this abomination.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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Post Brexit we might be able to buy some coins at 5% but even if the declaration is showing the numismatic / collectibles harmonised code correctly the couriers and / our postal services will default to 20% so you will most probably have to appeal the overcharging of VAT. In addition, because we will be outside of the EU the VAT is not prepaid on our behalf by the seller so the handler e.g. DHL, UPS or a postal service will have their fixed fees to add. With the latter it will definitely make sense to bulk up orders to amortise this fee but claiming VAT overcharged could be problematic for mixed shipments containing "collectible" coins and others that should be charged full VAT. 

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Aah, the minefield of silver and VAT. I'm not an expert on VAT in other countries so it is difficult to comment on the differing levels of VAT charged. Currently, if you are in the UK and are buying silver from countries in the EU and have them delivered to you in the UK, you are supposed to pay VAT at 20%. There may be loopholes and ways to circumvent this by, including buying from a country such as Estonia, but they could attract the notice of HMRC if you don't make the correct declarations or pay import duty. You can purchase silver in the UK and have it stored abroad, thereby avoiding the charge of VAT, however, if you take delivery you will pay VAT. It would be much easier if the UK - and the EU - removed VAT from silver as they did with Investment Gold. Hope this helps.

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30 minutes ago, ChardLizzie said:

Aah, the minefield of silver and VAT. I'm not an expert on VAT in other countries so it is difficult to comment on the differing levels of VAT charged. Currently, if you are in the UK and are buying silver from countries in the EU and have them delivered to you in the UK, you are supposed to pay VAT at 20%. There may be loopholes and ways to circumvent this by, including buying from a country such as Estonia, but they could attract the notice of HMRC if you don't make the correct declarations or pay import duty. You can purchase silver in the UK and have it stored abroad, thereby avoiding the charge of VAT, however, if you take delivery you will pay VAT. It would be much easier if the UK - and the EU - removed VAT from silver as they did with Investment Gold. Hope this helps.

My question was about UK sellers and the marginal rate scheme. All the German/Belgium dealers i have ever bought from sell silver coins under the marginal rate scheme. The rate of VAT on silver coins in Germany is 19% so it is not like there is no VAT but they are able to use the VAT legislation so they only charge VAT on their profits. This makes a massive difference to the cost of silver. i buy gold in the UK but i only buy second hand silver in the UK. i am sure i am not alone which means UK dealers are not getting the business they could and this will run into £millions in sales every year. i suspect on balance HMRC is losing out.

From my email from goldsilver.be in Belgium it would appear they are all 'lawyered up' and are exploiting every 'loophole' there is. Yes i have read if silver is sold in Germany to someone in the UK irrespective of the rate of VAT in Germany, the UK rate should be charged. It isn't. If there is German VAT to pay on say a box or coin capsule we end up paying it and no UK VAT is paid at all on the coins other than some VAT on profits. There will be many 1000's of packages going through. It could be customs just aren't checking but this is heavily advertised so it cannot be a secret and HMRC must be aware.

We have had discussions here with Paul Atkinson about VAT on second hand silver. i think after this i noticed most of his second hand silver coins were being sold VAT free when previously this had not been the case. Somehow or other dealers in Europe selling new silver coins are exploiting VAT legislation to their benefit [and ours] but at the same time to the detriment of UK dealers. So i wondered why UK dealers weren't doing the same. 

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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We have to abide by UK regulations, we do sell secondhand silver using the VAT margin scheme where you pay VAT on the dealer's margin as per HMRC's guidelines here https://www.gov.uk/vat-margin-schemes

Silver coins sold in the UK - for delivery in the UK - should have an element of VAT whether it is at the full 20% or the margin scheme.

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I think I have a explanation for the difference - the UK "margin scheme" is not the same as the Germans/Belgians.  

I gather that Germany treats coins differently from bullion bars, with a reduced 7% VAT rate on coins, and conclude that is what German suppliers are referring to with "§ 25a"?   In the UK the margin scheme only applies to second hand silver, thats clearly not the case when buying new coins from the continent.  If i compare a Britannia from a German supplier and a UK (postage not included) supplier, the German is 3% cheaper after account for 7% VAT and currency.   (What I cant quite work out is how Goldsilver.be is operating, because i gather VAT on silver coins in Belgium is apparently 21% and that would make them selling some coins under spot. So something else is going on there. )

Another factor is where the VAT is applied.  I've always believed that the VAT is charged where the sale is made, i.e. where the company is selling from.  Amazon for years was undercutting CD price by selling out of Luxembourg.  However the wisdom reading around is that VAT is charged at the rate in the country of the buyer. Confused... until i found this LexisNexis page where is makes the distinction between business to business (recipient VAT applies) and business to consumer (supplier VAT applies). 

In another thread, @sixgun suggest pulling together rules on importation, which add more complications (VAT rules are different for imports!).  Reckon thats the way forward, pool different information together in one place to work through the contradictions and conflicts.  

Sorry, I started hoping to bring some clarity, but the Friday beer has blurred things, I hope theres something useful. Ultimately, treating silver coinage the same as gold coinage would make this all a lot clearer and more sane, both in UK and in EU. 

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The VAT rate in Germany of 7% on silver coins ended a couple of years ago and went to 19%.
I was regularly buying silver coins at 7% then after the rate rise the clever Germans ( and others but NOT the Brits ) invoked the differential VAT scheme to attempt to limit the price increase to their customers. As for secondhand silver a dealer in the UK can today choose to apply zero rate VAT but doesn't, or builds a fictitious 20% into their margin so continuing to screw us. Under the terms of free movement of goods in the EU, once VAT has been charged at source, there is no further VAT to be paid so if the Germans charged 2% only using some legal loophole and shipped to the UK with say a 22% VAT rate ( after a rate rise ) we as buyers will not have to pay the difference of 20%. Working in reverse however a UK seller shipping to Germany would invoice their goods WITHOUT charging VAT and the German recipient elects to pay their local VAT at 2% rather than our 22%.

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 The rate at which VAT is charged depends on the total value of sales made to the EU state in question.

Selling from one EU state to another has the VAT rate of the country of origin if the total value of annual sales by the seller to that country does not exceed a country specific limit. In the case of the UK that is £70 000. Should sales exceed this value the seller should register for VAT in the UK and charge the UK rate of VAT on those goods.

https://www.gov.uk/guidance/vat-exports-dispatches-and-supplying-goods-abroad

Quote

When you need to register for VAT in other EUcountries

For distance sales, you must charge VAT at UK rates in the normal way. However, each country has a ‘distance selling threshold’. If the value of your sales to that country exceeds this limit, you must register for VAT in that country, and charge their rate of VAT on sales to that country.

Now how that should be policed i do not know. It is difficult to imagine goldsilver.be is not selling over £70 000 worth of silver coins into the UK but these sales are not being charged 20% VAT on the coins. There may be a 'loophole' they are exploiting, let's assume they are.

My question is why UK dealers aren't exploiting these loopholes to UK customers' [and dealer] benefit. UK dealers would make multiples of their present silver coin sales if the coins were selling at the rates we see in Europe.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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4 hours ago, sixgun said:

 The rate at which VAT is charged depends on the total value of sales made to the EU state in question.

Selling from one EU state to another has the VAT rate of the country of origin if the total value of annual sales by the seller to that country does not exceed a country specific limit. In the case of the UK that is £70 000. Should sales exceed this value the seller should register for VAT in the UK and charge the UK rate of VAT on those goods.

https://www.gov.uk/guidance/vat-exports-dispatches-and-supplying-goods-abroad

Now how that should be policed i do not know. It is difficult to imagine goldsilver.be is not selling over £70 000 worth of silver coins into the UK but these sales are not being charged 20% VAT on the coins. There may be a 'loophole' they are exploiting, let's assume they are.

My question is why UK dealers aren't exploiting these loopholes to UK customers' [and dealer] benefit. UK dealers would make multiples of their present silver coin sales if the coins were selling at the rates we see in Europe.

Goldsilver.be told me they have a turnover of hundreds of k of euros a day and that their average order is over 5k. They have gone over the threshold in less than a day. It is quite obvious that they are taking the proverbial, just like all other bullion dealers who sell abroad. 

Do we really need to make this even more public and maybe have the customs to launch an investigation? 

Can't you just be happy to save some bucks? Seriously, can we terminate this thread? 

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48 minutes ago, savoyard said:

Goldsilver.be told me they have a turnover of hundreds of k of euros a day and that their average order is over 5k. They have gone over the threshold in less than a day. It is quite obvious that they are taking the proverbial, just like all other bullion dealers who sell abroad. 

Do we really need to make this even more public and maybe have the customs to launch an investigation? 

Can't you just be happy to save some bucks? Seriously, can we terminate this thread? 

The objective of the thread was to collect information about how best to deal with the UK being outside the EU. For me i can buy silver in the EU and have it delivered inside the EU or to the UK, so it does not matter what happens with Brexit from my point of view. Most people here won't be able to do that. We can hope goldsilver.be and this group of sellers have got a solution or we can try to work out the best way forward.

The issues are the 5% VAT rate on collectibles. Silvertrader.uk from Newcastle has investigated this a lot but i don't know how this eventually worked out for him. People on the forum have reclaimed VAT successfully. It might be that people have to collect together for big purchases and make claims for overpaid VAT. If the European sellers are willing to assist UK buyers in this then the whole process might be easier. David at goldsilver.be says they are all lawyered up and prepared.

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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On 15/09/2017 at 10:23, sixgun said:

Now having read the post last night by Sovereign Steve about the reply he had received from Perth Mint about Harmonisation System Codes and that virtually none of the silver coins we collect are recognised as being covered for 5% VAT i was getting dismayed.

I have asked the Perth Mint for more information regarding their assertion the legal tender coins cannot be treated under the 5% numismatic HS code and told them about replies from UK Border Agency given to other parties essentially saying they can. Awaiting their reply.

Profile picture with thanks to Carl Vernon

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