VAT warning on international sales

[chameleon54]

Just thought it worth sharing my latest little buyer problem.

Overseas buyer purchases a rare antique item for $100. I send it with tracking. Buyer messages to say the correct postage has not been paid and his post office want an extra 22 British Pounds ( around $35 - $40 ) before he can collect it. He demands I pay him this amount or he will not accept the item and it will be returned to me at my expense. He sends a number of fairly abusive messages blaming me and demanding I refund him.

Eventually I dig out the postal reciept which shows it was Australia Post that calculted the postage cost and send the buyer a scan. I also quized him on a couple of occasions on wether the fee was underpaid postage or VAT. He declares it is under paid postage and all my fault. I decide to get on the front foot and contact ebay CS who where excellent ( again ). They spent around 20 minutes on the case and noted all of this information on the file. Once confronted with the scan of the postal reciept and the information that I had contacted ebay CS, suddenly the buyer sends a nice message saying the postal workers where mistaken ( yeah right ! ) and it was VAT after all. He has paid the fee and left pos. feedback.

The moral of the story is that buyers will get fairly abusive and try it on if they think they can bluff a seller into paying for their mistake. It also may pay to mention VAT if expensive items are mailed overseas on a regular basis.

 On a final positive note I have had to contact CS several times in the last couple of weeks and have found them to be genuinly very helpful. I,m not sure if I have just been lucky, but there seems to have been huge improvements in CS lately. They are taking the time to read messages and follow up on technicalities with team leaders if they are unsure of issues. They also seem to be more genuinly trying to find a balance between buyer and seller, rather than just supporting the buyers perspective. I would rank my last couple of CS experiences 10 out 10. Its nice to have a positive ebay experience to report amongst all of the negative stuff that is going on.

[padi*0409]

Good to hear a positive view of CS Chamo, lets hope they keep it up.

[k1ooo-slr-sales · Accepted solution]

of course, under the Universal Postal Union treaty there is zero chance of it being underpaid postage.  If it was underpaid postage then Aust Post would just have to wear it, and Royal Mail can not be claiming any costs for delivery under the treaty.

Good result for you, as it should be!

[clarry100]

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@k1ooo-slr-sales wrote:

of course, under the Universal Postal Union treaty there is zero chance of it being underpaid postage.  If it was underpaid postage then Aust Post would just have to wear it, and Royal Mail can not be claiming any costs for delivery under the treaty.

Good result for you, as it should be!

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Very good pickup Sir!

I was thinking exactly this as I was reading this thread and then saw your post at the very end.

Spot on.

Good outcome tho for you Chameleon.

[pennyforum14]

Just to add, it is not just expensive items that are affected by this.  The UK VAT collection is administered by Royal Mail who charge an administration fee for the service.  VAT is payable (but not always levied) on any overseas purchase which exceeds £15 including shipping, and the rate is 20%, plus the RM handling fee of £8.  It is this handling fee that inflates the payment amount, especially for low value orders (a £16 purchase would attract £3.20 in VAT but £8 to RM for collecting it).  It also causes some confusion because the card left in the mailbox to advise the buyer that the parcel is awaiting collection and settlement of the outstanding amount, is worder in such a way as to suggest it is additional postage, rather than VAT.

This is one of the biggest issues with our government's $0 threshold import GST proposal (deferred to July 2018).  The most likely amendment to the proposed unworkable model (which expects the eBays of this world to be responsible for GST on all sales on their platforms), is to adopt the UK model and have AP collect GST on receipt of the goods.  However, it has been shown in statistical projections that the revenue would be less than the cost of collection.  If they offset this by allowing Auspost to charge a Royal Mail style handling fee, what would that fee be, given that UK has a population three times that of Australia?  Economy of scale would suggest that to make it worth their while it would need to be at least $15, and with the threshold set at $0, that would all but eliminate overseas sellers. Mr Harvey and AP would be pleased, I am sure, but very few others would.

[digital*ghost]

This happens all the time, and usually it is less to do with shady buyers, and more to do with ignorant ones as well as how RM communicate that VAT needs to be paid on the package, because I believe they do actually get a message re: underpaid postage, or at least the wording is highly suggestive of that. 

I've had buyers surprised by import duties / taxes before, but it's always UK buyers who weren't aware of VAT etc and think it's a seller-created issue from underpaid postage. 

Still, even with shady buyers who try it, there is but one answer to a message like this - it is impossible to underpay postage at the counter of Aus Post.