New EU VAT regulation problem for sellers...

[widgetc]

I just went to ship something and saw this:

"Please be advised that Canada Post has not yet updated their services to follow the new EU VAT regulations (IOSS) which went into effect on July 1, 2021. If you sell an item valued up to 150 Euros to a buyer in the European Union, eBay is obliged to automatically collect the VAT from the buyer. This means that, should you ship your item with Canada Post to your buyer in the EU, they may be forced to pay the VAT amount again at the time of delivery or reject the package to be sent back to you at your cost. Your shipments to Canada, US, and countries outside of EU are not affected."

[mrdutch1001]

have not personally seen the notice as I have shipped nothing in the past month, but have been reading about this online as there are several articles readily available with the information...

also have been reading the comments from online sellers on other selling venue forums...

the consensus being many sellers are going to stop shipping to the EU countries...

[msmaggie060]

I dont think you have to worry about the Canada Post message. I just shipped an item to the UK and eBay provided the VAT number followed by the CODE: Paid. This is shown in the shipping address so if you don’t print eBay labels just write it on the package.

[msmaggie060]

Oops! Just realized that the UK may no longer be in the EU as of Dec. 2020 so my post may not be correct.

[mrdutch1001]

My last package shipped to the UK(shipped via Small Packet Air), never arrived at its location within the estimated timeframe and after 7 weeks still had not arrived, so I for one will no longer be shipping anything to that country in the future and I had stopped shipping to most EU countries many years ago already so none of this VAT stuff shall be affecting me nohow...

[kawartha-ephemera]

That badly worded message is currently atop the ebay announcements list. What I believe they're trying to say is that the Canada Post system is not yet ready to accept and display on CP labels the VAT Paid Code that eBay will be providing with each shipping address.

For the time, the solution for CP parcels is to print off the complete eBay shipping address provided in Order Details which INCLUDES the VAT PAID Code and attach that next to the CP label. Problem solved.

[reallynicestamps]

The VAT information for the UK seems to be the same as the VAT information for Australia.

It appears as part of the address, but since I hand write my addresses, I have been moving it over to the left which in my opinion would be more convenient for the customs and postal workers.

I could be wrong.

[kawartha-ephemera]

Since you're addressing by hand, moving the code somewhere visible but out of the address "zone" does not seem unreasonable. I do know that adding that code can be a challenge to integrate into those "busy" UK addresses. I print directly on the envelopes, I've been placing the VAT code alone on the 3rd line immediately above the city and postal code. UK addresses almost always use the maximum 6 lines with code included. Wish I knew whether postal sorting equipment is setup to capture that code information or if it's just eye candy.

[recped]

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@msmaggie060 wrote:

Oops! Just realized that the UK may no longer be in the EU as of Dec. 2020 so my post may not be correct.

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Your Oops is correct, the Code info for the UK will not work for the EU. Just like for the UK, Australia, New Zealand and Norway eBay will provide the proper VAT code as part of the buyer address.

The biggest impact for this is that Euro buyers will now pay at least 20% more even for low value shipments that were previously exempt AND worst of all sellers will be paying fees on an additional 20 - 25%.

Time to increase Euro shippping rates to compensate for the extra fees!

[lotzofuniquegoodies]

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@kawartha-ephemera wrote:
That badly worded message is currently atop the ebay announcements list. What I believe they're trying to say is that the Canada Post system is not yet ready to accept and display on CP labels the VAT Paid Code that eBay will be providing with each shipping address.

For the time, the solution for CP parcels is to print off the complete eBay shipping address provided in Order Details which INCLUDES the VAT PAID Code and attach that next to the CP label. Problem solved.

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@widgetc 

As noted above the only place the information currently displays are with the order details. It does not forward on to any of the eBay/Shippo generated packing slips. (PayPal Shipping unknown). You can do a screenprint and attach to shipping label or see below.

If you are still using Shippo you can cut and paste the information to the detailed  customs invoice and highlight and attach  to the shipping label. That document also gives you the option for customs to either dispose or return goods. In speaking to eBay UK customer service if the information is not readily available it's up to the customer to prove to customs that it has been paid by showing their original invoice details.

Standard courier/international postal service requirements for some countries(see CP guide) suggest including a packing slip with your customs documentation. Because the eBay Labels packing slip does not include standard information like price(extended prices), tax paid, shipping and final total it is not usable as a partner to a combined customs invoice for cutoms purposes. The Shippo packslip notes it as tax but not VAT Tax collected

-Lotz

Sidenote: From past experience dealing with US customers many are uncomfortable giving out information like Tax ID #'s/EIN numbers(Mandatory with courier shipments) and having it in full view but they are more understanding when you let them know it is for customs purposes only and will be visible just on the customs documents. Similar to how Canadian's are to giving out their SIN number.

*****The procedure noted above I have used for multiple shipments to France/UK/2 other European countries and Australia and no issues to date.

[recped]

Following on with the Lotz post above........

I use Stamps.com to print my USPS postage, when Stamps pulls the buyer info from eBay it DOES NOT include the VAT Code information. On the other hand my eBay management software, SixBit, DOES pull the VAT Code info from eBay.

I'm guessing this is a similar situation with postage providors like Shippo or Canada Post, they are not pulling the info and you need to manually add it to the Address before printing labels.

[hlmacdon]

Postal services have to update their electronic customs forms and shipping label platforms to include an International Tax ID field. In the case of the EU, the IOSS number for the marketplace would go there. That field doesn't necessarily get printed on the label but it is part of the required electronic data that is interchanged beteween postal providers. It would be a standardized field that any UPU member postal service would see as populated when they scan the package to see if VAT has been paid already. You can manually add it as part of the address (that is how Australian shipments were being handled) but it may end up sitting in customs for manual review like non IOSS prepaid shipments since it won't be detected when the do the scan sort.

[msau4301]

Does anyone know what happens with this VAT issue for packages mailed out to Europe in June but won't be delivered until after the July 1st date. Will customs look at the postage date? or date they receive it over there?

I have two packages sent to Italy June 14 and 21st that haven't arrived (which isn't unusual - usually takes a few weeks), but wondered if this VAT change will be an issue delaying them further? I guess time will tell.

[marnotom!]

Seeing as the items in question wouldn’t have been subject to a VAT charge by eBay at the time of purchase, they’d be handled by customs by “the old way” even if they were received after 30 June.

At least, in theory.

[msau4301]

Thank you! Hoping for the "old way".

[itolduandso]

The EU and UK agreed to align their policies around VAT process and we can probably thank the Irish for that. So it shouldn't be that complicated once dust settles down. The main difference is going to be in the rates they charge.

[itolduandso]

The EU did this to protect their eshops from Chinese ecommerce and to collect VAT on those shipments from China (because Chinese platforms would never collect VAT or remit any). Time to do the same in Canada, I really hope for this to happen. I rarely shop in Aliexpress and most of it is junk, when they tell me to return gooods they provide Chinese return address and return fees are 3 or 4 times to price of goods. Yet sellers have to compete against Chinese junk. Time to implement same in Canada and US. Then the free trade agreement could exempt shipping for goods between these 2 countries.  No reason the government is cozying up to China.

[itolduandso]

This was advertised change ahead of time. Have you informed your buyers? Make sure all your new listings mention in the T&C that the VAT will be charged either at the time of sale or at the time of receipt of goods

[hlmacdon]

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@itolduandso wrote:

The EU did this to protect their eshops from Chinese ecommerce and to collect VAT on those shipments from China (because Chinese platforms would never collect VAT or remit any). 

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Futile effort it would seem. In the niches I monitor the well known Chinese etailers are all using IOSS interemediaries to declare all packages at 20 EUR. Nothing really changes. 😂

[mrdutch1001]

No matter what selling venue I am selling on these days, the amount of orders/sales to Europe hasn't warranted advertising shipping to these countries, so I choose the simple route and exclude these countries. On occasion I get asked if I will ship to a specific country and at that time I make whatever decision is necessary. Just simplifies shipping for me. I know there are many sellers that do rely on their International customers, so they are going to have to make sure buyers from those EU countries are aware of this VAT charge.