This guide aims to explain the process of ordering from our EU suppliers. Since Brexit, there are new requirements for receiving goods into the UK from EU suppliers. We have worked with the suppliers and their couriers to create a process that causes minimal hassle for our retailers and also a seamless experience for the end-customer.
Prerequisites to use our EU Suppliers
- UK Retailers must have an EORI number and provide it to us
- Retailers should understand the duty & vat obligations (see below) and consider those in your retail prices
- Per item shipping and duty % is shown in the Profeed platform against each EU product
Terms
- Supplier = EU Exporter of the goods
- Retailer = This is the UK e-commerce store selling the goods
- Customer = end-customer receiving the goods to their home
- Profeed = This platform acting as sales agent and ordering system sitting between retailer and supplier.
Ordering Process
- Consumer purchases product from retailers e-commerce store, paying a single total including VAT and delivery as normal.
- Retailer places an order with the supplier via the Profeed platform.
- Supplier invoices retailer for cost price of items + shipping charges. There is no VAT charged by the EU supplier.
- Supplier ships the order via their courier
- Supplier is responsible for freight insurance
- Supplier’s courier handles customs paperwork, the retailer is specified as the invoice contact for HMRC Customs, cost price for goods and shipping is detailed on paperwork submitted.
- The goods are brought into the UK and delivered directly to customers home by the courier.
- Some weeks later the retailer receives an invoice from HMRC for the VAT & Duty on the order.
- The duty is calculated on the cost price of goods + shipping, VAT is then applied to that total.
- Duty rates varies depending on the HSN Code (between 0-4%), we recommend for safety you build a flat 5% into your retail pricing.
Scenario
- Customer buys item for 299 GBP including vat & delivery to home
- The item has a customs code (HSN) of 94016900 which is at 2% duty
- Supplier cost price is 100GBP + shipping charge is 30GBP
- Supplier invoices the retailer 130GBP and on payment arranges shipping via courier.
- Some time later, goods arrive with customer (no additional charges to customer)
- Retailer receives invoice from HMRC for import duty and vat on both duy and (Cost Price + Shipping), in this example:
Cost price goods = 100
Shipping = 30
Duty Total : (100+30) *0.02 = 2.6GBP
Vat Total @20% = (100 + 30 +2.6) = 132.6 * 0.2 = 26.52GBP
