Sales to EU customers From 01 Jan 2021

First and foremost, we trust that the arrangements we have put in place will minimise inconvenience when transacting with Mad-HQ.com from the EU, whilst offering the best possible price. There will however be some differences to the buying process: VAT will be treated differently, though with no or, neglible extra cost implications; there will be some small import charges and, for B2C orders over €150, there will be duty on some items - details of both are laid out below. However the import process is highly automated and for most orders you will simply receive an email/SMS with a payment link for these charges and this should allow your delivery to proceeed with minimal delay. Please read the relevant sections below for more detail and thank you for your interest in Mad-HQ.com. 

Buying from the EU on Mad-HQ.com post Brexit
Below we try to set our how business will be affected between the UK and the EU from Mad-HQ's perspective. The following is written in good faith based on the best information available at the time of writing. Please note that e-commerce landscape is complex due to both Brexit and the fact that the UK and EU are implementing revisions to B2C trading rules at different times, as the EU delayed the implementation by 6 months due to the pandemic, which the UK has not done! 

B2C Retail Sales to the EU after Brexit 01 Jan 21 to 30 June 21
From 01/01/21 EU B2C Retail sales will be conducted on DAP 2020 Incoterms. DAP stands for Delivered at Place and means we are responsible for UK export costs and delivery up until your requested delivery place. So what does this mean for you and how will the order be processed?

a. EU B2C orders must be placed in € as these prices include UK export charges (£ prices don't).  
b. The sale price will not include UK VAT at 20%, but the customer will be liable for Import VAT if the order exceeds €22 (less in some EU countries eg €1 in France €17.05 in Cyprus, DK80 in Denmark and €nil in Sweden). Import VAT is charged at the VAT rate where the order enters the EU, this is normally France, who currently has a 20% VAT rate, though the country of entry may vary and VAT rates vary from EU country to country. VAT charges are therefore very similar to pre Brexit, but collected in a different manner and you the customer become the importer of record.
c. The customer is liable for EU import charges (approx. €4-5 for a boxed consigment or, approx. €30 for a pallet). Where the order includes more than 3 different commodity codes these fees may rise slightly based on the number of commodity codes. 
d. The customer will be liable for import duty on orders over €150 on items that originate from a country that does not have a free trade agreement with the EU. Many of our products fall in to this category as most fitness equipment is made in the Far East. By way of indication the majority of duty rates on our equipment are between 2.7% - 6.5% (clothes and socks in particular may be higher). A list of our items country of origins and commodity codes can be found here.
e. Our couriers will get in touch to collect any import, VAT and duty charges. For the vast majority of B2C orders we use DPD and DPD will receive all the electronic customs data immediately upon collecting the consignment from us, they will then process this and email/SMS you with a payment link, so that you can pay any charges before the parcel even reaches the border and if you pay promptly there will be negligible delays in delivering your parcel. The courier will hold the parcel for approx 5 days pending payment and if this is not made the consignment will be returned to us. 
Please note:Some customers may prefer to buy from one of our EU distributors please see our International Distributors List & Information where you can find an EU reseller of most of our products. If you are interested in Align-Pilates apparatus please visit Align-Pilates International Distributors.

B2C Retail Sales to the EU after July 21
From 01 July 21 the EU's One Stop Shop VAT legislation comes in to force, which will allow registered companies to trade more seemlessly with EU B2C customers. Plans are in place for Mad-HQ.com to set up for One Stop Shop VAT and when it comes on stream we intend to offer DDP Incoterms, which means, Delivery Duty Paid. In effect you will then pay the price you see on our website and we will be responsible for all export, import, VAT & duty charges. Please bear with us until this is possible!

B2B Sales to the EU after Brexit
Business to Business sales will also face some changes from 01 Jan 2021, which are as follows:

  1. EU B2B orders must be placed in € as these prices include UK export charges (£ prices don't).  
  2. All B2B sales to the EU are now conducted on DAP Incoterms 2020. DAP means "Delivered At Place" and under this terms we are responsible for UK export charges and delivery up until the requested place of delivery. You, the customer are responsible for EU import charges, import duty & import VAT as applicable and unloading the delivery (see below for more details on VAT and other charges). 
  3. In order to do business with us all B2B customers require a valid EORI number, an EORI number is required for businesses to import or export goods with countries outside the EU. Please see more information on EORI numbers below.
  4. If any of this is unclear, please feel free to call us and order over the phone.

How are VAT, Duty and and fees collected?
Our couriers will get in touch to collect any import, VAT and duty charges. For the vast majority of B2C orders we use DPD and DPD will receive all the electronic customs data immediately upon collecting the consignment from us, they will then process this and email and text you with a payment link, so that you can pay any charges before the parcel even reaches the border, if you pay promptly there will be negligible delays in delivering your parcel. The courier will hold the parcel for approx 5 days pending payment and if this is not made the consignment will be returned to us, we will then issue a refund but reserve the right not to refund the carriage charges, which will have already been incurred along with the return courier charges. The process for pallet deliveries is similar, though less automated, and the courier will contact you for payment and once this is remitted they will deliver the pallets.

EORI Numbers and VAT & Import VAT - who pays what?
An EORI number is required to import or export goods with countries outside the EU for all B2B transactions. You do not have to be VAT registered to have an EORI number, but if you are, the two numbers will be linked together (you may need to request this, depending on when you got your VAT & EORI numbers). After the 01/01/21 VAT will be treated as follows:

  1. Mad-HQ.com will not charge UK VAT on sales to the EU, regardless of whether you have an EU VAT number.
  2. Customers who are not VAT registered will pay import VAT, at the rate of the country where the goods first enter the EU. Most of our shipments enter the EU via France, whose VAT rate is currently 20%, but please note this is not the guaranteed point of entry and EU VAT rates differ from country to country.
  3. VAT registered EU customers who provide an EORI number that is linked to their EU VAT number, will not physically have to pay import VAT as our couriers can record this against your EORI/VAT number. The effect of the VAT changes will therefore not significantly affect the price you pay compared to pre-Brexit.

Import Duty - what is chargeable under the new UK-EU free trade deal?
Despite news of a free trade deal between the EU & UK, this is in fact quite complex. There is also a difference between B2B and B2C customers. For B2C customers orders under €150 will not have duty charged. For orders over €150 or for B2B customers, in simple terms most goods are only tariff free if they are either made in the EU or, UK (or substantially finished there) or, if the country of origin has a qualifying free trade agreement with the EU. As by far the majority of all fitness & Pilates equipment globally originates from countries that do not have free trade agreements with the EU, then goods originating from these countries will incur import duty! This therefore applies to a substantial percentage of our products, as well as those of most other brands. Fortunately, the duty on most of the dutiable items we sell is relatively low at between 2.7% & 6.5%. A list of country of origins and indicative duty rates and commodity codes can be seen here.

Customs Clearance Costs
Under DAP Incoterms Mad-HQ.com will pay for UK export costs, so long as you pay in € on this website. You the customer are responsible for import fees, which depend on the courier, the size of the delivery and the amount of different commodity codes on the shipment.

  1. For parcel deliveries our main courier DPD have advised that there is a recipient admin fee on DAP, which will be approx €4-5.
  2. For pallet deliveries the charge is approx.*€30 based on 3-5 commodity codes or + €1.50 per extra code. *Fees vary slightly from forwarder to forwarder.

Official Advice from the EU
EU customers may be interested in reading this advice from the EU Buying goods online coming from a non-European Union country | Taxation and Customs Union (europa.eu)

31/12/20

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