Shopping online what country are you buying from?
With Black Friday and Cyber Monday almost here this is a reminder to be cautious when purchasing online.
Within Europe we are used to certain consumer protections (for example a 14 day cooling off period, the right to a repair, replacement or refund for a defective product and minimum information and product safety requirements).
These same protections are not available when you are purchasing outside of the European Union.
In addition to consumer protection you should also think about other considerations before deciding to make a purchase:
Revenue Commissioners guidelines act as a reminder of the additional taxes that may also be due and payable.
So avoid the shock of being asked for the tax by including it in your calculation before you buy.
The taxes that may apply are Value Added Tax and Customs Duty (Excise Duty might apply too depending on your purchase).
Value Added Tax
VAT will arise on the import of purchases from outside the EU of over €22.
For example on a purchase of €100 you need to add on €23 for VAT (assumes 23% VAT on the goods), VAT will also be charged on any insurance and transport or handling costs.
If goods are over €150 in value customs duty may also be payable.
Customs duty is calculated on the value of the goods, the postage, packaging, insurance and any handling charge to deliver the goods to the EU.
The Revenue guidelines give the example of goods that you purchase online outside the EU for a price of €500. The insurance cost is €50 and the transport cost is €50.
The ultimate total cost for the purchase when you add on the VAT and customs duty comes to €674.90 – the goods of €500, customs duty of €30 and VAT of €144.90.
So watch out for the hidden taxes and duties on import into the EU.
Undervaluation or false declaration of the value of goods is illegal.
Be Cautious and be informed
Think before you click and purchase – is it too good of a deal?
Do the maths to determine the full cost to you before going ahead and pressing the pay now button and proceeding to make any payment.
You may not be able to get out of the transaction if no cooling off period applies.
If you do return the goods you may qualify for a refund of these additional taxes.
Want to know more about purchasing online then check out the Revenue Guidance or contact us.
The material in this article is for general information purposes only and does not constitute legal or taxation advice. Specific legal and taxation advice should be sought before acting. All information and taxation rules are subject to change without notice.
No liability whatsoever is accepted by M. McLoughlin & Co. for any action taken in reliance on the information in this article
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