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Importing and Selling art

DColes
Posts: 1
Joined: Thu Apr 20, 2017 4:06 pm

Importing and Selling art

Postby DColes » Thu Apr 20, 2017 4:14 pm

If a business imports art on a Temporary Bond with a shipper into the UK my understanding if the artwork is sold is that import VAT of 5% of the sale price is paid plus the duty to the shipper that holds the bond. My question is if the business sells the art to a UK client and the business is VAT registered does the business still charge the 20% on the sale as well as paying the 5% import VAT? Also is the 5% Import VAT claimable on a VAT return?

Thanks, Daniel

Lavender2306
Posts: 21
Joined: Mon Dec 12, 2016 11:03 pm

Re: Importing and Selling art

Postby Lavender2306 » Thu Apr 27, 2017 7:13 pm

DColes wrote:If a business imports art on a Temporary Bond with a shipper into the UK my understanding if the artwork is sold is that import VAT of 5% of the sale price is paid plus the duty to the shipper that holds the bond. My question is if the business sells the art to a UK client and the business is VAT registered does the business still charge the 20% on the sale as well as paying the 5% import VAT? Also is the 5% Import VAT claimable on a VAT return?

Thanks, Daniel


Hi Daniel,

Let's clarify the scenario and if I get something wrong, please, let me know.
So you have a business A which imports artwork under suspension of customs duties and import VAT. A is a UK vat registered business.
A is an importer and it is its obligation to pay duties and import VAT on any sold items.
A sells an artwork to a UK customer B. As a general rule A will need to charge UK vat on the sold item.
However, there is VAT marginal scheme should be available for artwork. I am not very familiar with this marginal scheme so you will need to read about it on HMRC's website.

In its vat return A will show the following:
Box 1 Output vat amount charged to B
Box 4. Import VAT paid to customs, provided it has a vat certificate

Thus import vat is paid as a result of importation of the artwork to the UK
and the UK VAT is charged because the sale of the artwork to a uk customer is a standard rated uk supply.


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