Importing through Hong Kong

trailbiker

Hi Guys.

Do you know if one is exempt from customs charges if the goods are shipped via Hong Kong? I've heard that this is the case from a friend who buys all his photographic equipment from China. Perhaps he has just been lucky however as his shipments were probably not very large package sizes and so might have escaped the attentions of customs more easily. A bike/bike frame might be a different story.

mloc123

I got rims delivered without being hit, now if only I could get them built..

Bluefoam

I've bought stuff from Hong Kong & have been hit. Always get the package labelled as a gift.

blorg

trailbiker wrote: »

Hi Guys.

Do you know if one is exempt from customs charges if the goods are shipped via Hong Kong? I've heard that this is the case from a friend who buys all his photographic equipment from China. Perhaps he has just been lucky however as his shipments were probably not very large package sizes and so might have escaped the attentions of customs more easily. A bike/bike frame might be a different story.

Of course not, Hong Kong was last time I checked outside the European Union. Legally duty and VAT must be paid on imports. Certain HK sellers may be co-operative at misdeclaring the value of the stuff they are selling.

trailbiker

blorg wrote: »

Of course not, Hong Kong was last time I checked outside the European Union. Legally duty and VAT must be paid on imports. Certain HK sellers may be co-operative at misdeclaring the value of the stuff they are selling.

But up until '97 it was under British control. My friend said that there was some trade agreement amoung other lingering things put in place after the change over. My firend is, however, not the most reliable when it comes to accuracy of information. He is often given to stating his notions as fact. Nie guy all the same though.

bcmf

trailbiker. your friend may have got away with you and so may you and many others. That is not to say that any one else will not get hit. Relabelling at source is NO GUARANTEE of getting away with it. You are at the mercy of customs. They may not pull it in or they may not. If they do they will ask to see invoices etc and basically prove beyond doubt that the price declared is the actual value and even then it still up to customs. You may choose to ask them to re-evaluate but it could take weeks.
It may also just turn up at your door without question.

Bluefoam

Its not the Chinese who are charging you vat. It is done by customs in Dublin - as you are importing goods.

Some items get through, but most are spotted. Most of the courier co's declare their inventory to cut out hassle. Sometimes standard post gets through.

Chips Lovell

According to the EU customs database, you have to pay duty on bikes and parts from Hong Kong.

Asking someone to lable a consignment as a gift when it isn't does count as tax evasion by the way.

Bluefoam

el tonto wrote: »

Asking someone to lable a consignment as a gift when it isn't does count as tax evasion by the way.

I must have phrased that wrong... Always get it labelled as a gift if it is in fact a gift.

Lumen

el tonto wrote: »

According to the EU customs database, you have to pay duty on bikes and parts from Hong Kong.

Asking someone to lable a consignment as a gift when it isn't does count as tax evasion by the way.

It is tax evasion if it doesn't get charged despite you make no efforts to avoid it?

A friend of mine received some expensive wheels from Singapore and was only charged about €35 (cash on delivery) for "customs handling" or some such. Is he legally obliged to approach customs after the event and declare the goods?

trailbiker

bcmf wrote: »

trailbiker. your friend may have got away with you and so may you and many others. That is not to say that any one else will not get hit. Relabelling at source is NO GUARANTEE of getting away with it. You are at the mercy of customs. They may not pull it in or they may not. If they do they will ask to see invoices etc and basically prove beyond doubt that the price declared is the actual value and even then it still up to customs. You may choose to ask them to re-evaluate but it could take weeks.
It may also just turn up at your door without question.

Bluefoam wrote: »

Its not the Chinese who are charging you vat. It is done by customs in Dublin - as you are importing goods.

Some items get through, but most are spotted. Most of the courier co's declare their inventory to cut out hassle. Sometimes standard post gets through.

If bought from a legitimate source and item sould be taxed at the country of origin. When received by customs they can then damand VAT payment on the item where the buyer, so that they are not taxed twice, can then chase up the VAT refund from the country of origin. This can be a pain in the ass though so it'd make sense for certain countries to have trade agreements in place (effectively the EU member countries have this between each other) and, according to my friend, Britian and Hong Kong have such a trade agreement so (according to my friend) if one was to import something via the Hong Kong and the UK they would not be subjected to customs charges. Make sense?

blorg

trailbiker wrote: »

But up until '97 it was under British control.

Doesn't matter. Territories under current British control but outside the EU you have to pay duty and VAT importing into the EU (the likes of Bermuda.) Even importing from the Channel Islands you have to pay import VAT if over threshold (although not duty as they are in the EU customs area but not the EU.)

trailbiker wrote: »

If bought from a legitimate source and item sould be taxed at the country of origin.

You have it backwards, EU retailers exporting do not charge the buyer VAT so there is no double taxation. Most other countries behave the same way with regard to their sales taxes AFAIK- but whether they do or not has no impact whatsoever on import duty/VAT in the importing country.

As a matter of practicality you may get away without paying import duty and VAT; as stated through the postal system you have more of a chance.

Lumen

trailbiker wrote: »

If bought from a legitimate source and item sould be taxed at the country of origin. When received by customs they can then damand VAT payment on the item where the buyer, so that they are not taxed twice, can then chase up the VAT refund from the country of origin. This can be a pain in the ass though so it'd make sense for certain countries to have trade agreements in place (effectively the EU member countries have this between each other) and, according to my friend, Britian and Hong Kong have such a trade agreement so (according to my friend) if one was to import something via the Hong Kong and the UK they would not be subjected to customs charges. Make sense?

No it doesn't, otherwise all Chinese-produced goods destined for the EU would go through HK and the UK to avoid import duties.

The rest of your explanation doesn't make much sense to me either. The supplier is responsible for charging sales taxes in the source country if they apply to exports, but usually they don't. Import duty is a tax on movement of goods, not a sales tax like VAT, and VAT is applied to imports on top of duty and regardless of any sales taxes applied in the source country.

Chips Lovell

Lumen wrote: »

It is tax evasion if it doesn't get charged despite you make no efforts to avoid it?

A friend of mine received some expensive wheels from Singapore and was only charged about €35 (cash on delivery) for "customs handling" or some such. Is he legally obliged to approach customs after the event and declare the goods?

It's an interesting question. My understanding has always been that if Revenue does not charge you customs or VAT at point of entry, you are effectively granted a pass. They seem to have no system in place for paying duties and VAT after delivery.

If I had to guess, I'd say there's an unwritten acknowledgment there that they can't catch everything and they'll settle for getting most of the big ticket items. We all know people who've imported stuff and not been charged after all. Once stuff has cleared customs they have no way of tracking it and no way of enforcing people to pay retrospectively.

I could put a query into them though if you want.

Lumen

el tonto wrote: »

I could put a query into them though if you want.

It would be interesting to know the official answer, although in the absence of that I my friend will just incriminate you in any Revenue investigation.

trailbiker

Lumen wrote: »

No it doesn't, otherwise all Chinese-produced goods destined for the EU would go through HK and the UK to avoid import duties.

The rest of your explanation doesn't make much sense to me either. The supplier is responsible for charging sales taxes in the source country if they apply to exports, but usually they don't. Import duty is a tax on movement of goods, not a sales tax like VAT, and VAT is applied to imports on top of duty and regardless of any sales taxes applied in the source country.

This is pretty much what I thought also. My friend gets these notions... It would only make sense for the sake of convenience and to be between 2 countries that were of roughly equal size and who's imports/exports were roughly equivalent hence not having a negativee impact on one of them in particular.

Chips Lovell

Lumen wrote: »

It would be interesting to know the official answer, although in the absence of that I'll just incriminate you in any Revenue investigation.

I'd say I'd get one of two answers. Either a tacit acknowledgment of the system as it stands, i.e. you're OK if you don't try and avoid it and we don't ask you for it. Or they'll tell me that it's up to you to send them a cheque. I suspect the answer could depend as much on who provides it than anything else.

Beasty

Lumen wrote: »

It is tax evasion if it doesn't get charged despite you make no efforts to avoid it?

Technically yes. The purchaser is importing the goods, and has a responsibility to declare the goods when brought into the country (not really much different from going through the red channel at an airport).

The sender is at fault if they fail to correctly declare the value, but in practice there is unlikely to be any sanction against them because they are based overseas. Hence the Irish Revenue only really have the purchaser to go after.

In practice, however, once past the port of entry there does not appear to be much the Revenue can do about it as they are unlikely to have any evidence of the "crime"

Lumen

Beasty wrote: »

Technically yes. The purchaser is importing the goods, and has a responsibility to declare the goods when brought into the country (not really much different from going through the red channel at an airport).

The difference being that at the airport it is you taking through your own stuff, whereas in the case of imports it is the courier who handles the customs clearance.

blorg

trailbiker wrote: »

This is pretty much what I thought also. My friend gets these notions... It would only make sense for the sake of convenience and to be between 2 countries that were of roughly equal size and who's imports/exports were roughly equivalent hence not having a negativee impact on one of them in particular.

This is roughly how the world is arranged at the moment:



Note Turkey although not in the EU is in a customs union with the EU since 1995.

Beasty

Lumen wrote: »

The difference being that at the airport it is you taking through your own stuff, whereas in the case of imports it is the courier who handles the customs clearance.

The courier relies on the Customs declaration - it does not alleviate the purchaser of the responsibility to pay the tax due.

If you think about it, it's really not different to smuggling tobacco or cigarettes (which is normally done to avoid duty and VAT) - the fact you successfully get them into the country does not mean you cannot be prosecuted

Further guidelines on importing by post here

Beasty

blorg wrote: »

This is roughly how the world is arranged at the moment:



Note Turkey although not in the EU is in a customs union with the EU since 1995.

Can we not send Iceland to somewhere in the Southern Pacific (perhaps to join up with SPARTECA), as they are causing all sorts of problems where they are now?

gman2k

Declaration of an item as a gift makes no difference to the customs personnel whatsoever.
Also, the VAT charged by the customs is payable on shipping cost also.
Finally, when your goods are stopped by customs and inspected - they will write to you and look for a PayPal or other valid receipt/ invoice. If it's an eBay item your PayPal invoice will contain an eBay item number - which can be verified independently by the customs.
The customs only take a selection of items through the sorting process, they don't have the manpower or resources to stop everything coming through.
EG, last week someone bought an entire carbon fibre frame from HK - no probs with customs - arrived at buyers door - happy days.
This week someone buys a cassette from HK and gets stung.....
You takes your chances...

TinyExplosions

Beasty wrote: »

Can we not send Iceland to somewhere in the Southern Pacific (perhaps to join up with SPARTECA), as they are causing all sorts of problems where they are now?

I'm I the only one who likes the zone called SPARTECA?

I'm Sparteca, and so's my wife....

-I'll get me coat

Chips Lovell

Revenue got back to me earlier today. Here's what they said:

Due to the volume of parcels received, it is not possible to ensure the collection of customs duty and VAT in every single case. Where the parcel is delivered without payment of the correct duties and VAT, it is of course open to the public to make contact with Revenue and pay the appropriate charges. In practice however this is quite rare.

teufelswerk

Lads no need to worry, saw tax evasion mentioned here earlier. 1 of 2 things will happen
1. Your goods will be stopped at customs in which case you'll be expected to pay to release the goods.
2. The most likely and logical outcome. Your goods will arrive at your house, at which stage any liability to tax is hard to calculate. I know revenue powers are greater than Garda powers to enter your property but they're unlikely to come into your house to value the frame or wheels that they'd missed in the first place.

The possibility of being done for tax evasion is unfounded given the levels of tax missed and the danger of revenue having to prove you intentionally arranged the transaction to not pay tax. Tax avoidance, there's a real possibility but again how would they become aware of your liabilty to tax after you received the goods.

Beasty

teufelswerk wrote: »

Lads no need to worry, saw tax evasion mentioned here earlier. 1 of 2 things will happen
1. Your goods will be stopped at customs in which case you'll be expected to pay to release the goods.
2. The most likely and logical outcome. Your goods will arrive at your house, at which stage any liability to tax is hard to calculate. I know revenue powers are greater than Garda powers to enter your property but they're unlikely to come into your house to value the frame or wheels that they'd missed in the first place.

The possibility of being done for tax evasion is unfounded given the levels of tax missed and the danger of revenue having to prove you intentionally arranged the transaction to not pay tax. Tax avoidance, there's a real possibility but again how would they become aware of your liabilty to tax after you received the goods.

Don't want to get technical, but tax avoidance is legal, tax evasion is not. What we are talking about here is tax evasion, if someone deliberately fails to pay the duty

I fully accept, given the amounts involved, that the chances of being prosecuted are remote, but the amount of tax involved does not affect the technical position.

If we were talking about avoiding VAT and duty on a lorry full of cigarettes the offence is technically the same, but there would then be a very high chance of prosecution because of the scale of evasion involved.

blorg

@Beasty- the Revenue's response quoted by el Tonto suggests that it is "open" to the receiver to declare the goods received but makes no suggestion this is mandatory. If it were actually a legal requirement to notify them of goods they missed I imagine they would say so.

In the US for example many states have a legal requirement that goods imported from another state are liable to a use tax in lieu of sales tax- which no-one pays in practice, but they are quite clear that legally you are liable to declare and pay it.

I particularly liked the "In practice however this is quite rare."

teufelswerk

Beasty wrote: »

Don't want to get technical, but tax avoidance is legal, tax evasion is not. What we are talking about here is tax evasion, if someone deliberately fails to pay the duty

I fully accept, given the amounts involved, that the chances of being prosecuted are remote, but the amount of tax involved does not affect the technical position.

If we were talking about avoiding VAT and duty on a lorry full of cigarettes the offence is technically the same, but there would then be a very high chance of prosecution because of the scale of evasion involved.

Yeah, I'm aware of the technical side of this from my time working in tax consultancy. What I mean is I cannot even imagine a situation where the average punter would get to be in possession of the product and subsequently receive a tax liability. That would be an abomoly in the system and I've never seen it happen for an individual customer in my very limited experience. From preparing clients for revenue audits, I wouldn't lose any sleep once that bike crossed into my house.

Beasty

blorg wrote: »

@Beasty- the Revenue's response quoted by el Tonto suggests that it is "open" to the receiver to declare the goods received but makes no suggestion this is mandatory. If it were actually a legal requirement to notify them of goods they missed I imagine they would say so.

It's "open" to the receiver to allow the receiver to satisfy their obligation to pay the VAT and duty to the Revenue. If it's declared, this should remove any (albeit remote) risk of prosecution and/or penalties

Going back to my lorry full of cigarettes example - do you think there is no obligation on the receiver of the goods here? As an alternative, say a LBS purchases a supply of bikes from the Far East, taking delivery without declaring the duty (they arrive in a large container on the back of a ship). If the delivery company/importer is aware of the country of origin, and a false customs declaration, they are liable to prosecution. Similarly the LBS has conspired to avoid duty, and could be prosecuted.

In practice, if the "evasion" is small scale, the Revenue will probably make do with issuing a warning, and collecting the tax due. If someone is caught doing this a few times, they could well be prosecuted even if small amounts were involved

teufelswerk

Good point with the lorry of cigarettes, granted at the larger end of the scale. However, the fact that these are mostly seized at the port goes to highlight the fact that the evasion will be noted upon your receipt of the goods. As the OP is trying to get the bike in and is worried about his liability and legality it's safe to say that he should be paying the tax, however it seems on a voluntary basis.