1. do I need license to Export E Ciggs from UK to Belgium, Holland, France Germany, Spain and Portugal and if so how do I obtain one
2. Should I pay VAT in UK for products I am exporting or in the EU country of sales
3. I have an Off Shore company in Gibraltar as a service and distribution company where I pay no personal or company or VAT TAX at all. If I use the off Shore company to do the export / import I have to pay UK VAT on export and VAT on import to the EU countries…so is it best to open an EU company in each country I export to and pay the local VAT and not the UK VAT
4. Is there a company that can assist with these questions and export / import so that I am legal and super tax efficient?
Before you get started on what rules apply to your product you need to know how that product is classified in the EU. See https://www.gov.uk/classifying-tobacco. In essence if an electric cigarette is imported with a packet of cartridges, the whole set is to be classified together to commodity code 8543 70 90 99 as an electrical product not elsewhere specified. However, a nicotine cartridge containing a preparation of nicotine intended to assist smokers to stop smoking is classified to heading 3824 90 97.
Much depends on the make up of the cartridges e.g. how much if any nicotine they contain and what other chemicals they contain.
The normal system in the EU is that if the exporter is tax registered in the country of export and the importer is tax registered in the country of import then VAT should not be charged by the exporter. The importer would then self-report and assess his tax liability and depending on his business the VAT due may well be offset – in effect becoming non payable.
If the exporter is tax registered but the importer is not tax registered in the country of import then the exporter must charge UK VAT to the importer who will not be able to reclaim it.
If you (A UK company) are buying product from a UK tax registered company in the UK this is a local or domestic transaction and is subject to VAT. This is a separate transaction to your eventual sale to a customer somewhere else in the EU.
If you are exporting and your customer is importing you would not need to become involved in the VAT of the importing country. You need to ensure your choice of INCOterm reflects this.
A company registered in Gibraltar is not going to work well as the exporter from the UK – for it to be involved you would really need to be exporting from Gibraltar.
(T) 0784 1133027
as Susan states in the previous post, ECiggs do not need to be licensed in Germany.
If you need any legal advice on the VAT front I will be happy to send you a list of German lawyers who will be able to help you. Just send me you email address and I will mail it to you.
Thank you Susan and Baerbel.
I spoke with the UK VAT office and as I am buying from UK and distributing in Europe then it is not classed as Exporting…..I can also claim Zero Rate VAT on purchase as I am a VAT registered limited Company in Spain and will be selling on to VAT registered companies throughout Europe.
I am now looking for Agents to distribute as partners to my company in Belgium, Netherlands, France, Germany, Spain and Portugal….any ideas as to how to attract Genuine, Dynamic, Driven to succeed entrepreneurs?