[Closed] 16.7% Discount on Canyon Bikes? (Fraudulent but...)

Not quite sure about the in’s and out’s of what you’re suggesting. But, it just sounds like tax avoidance, not tax evasion.

Legal enough for every thieving corporation and most government ministers to have been doing it for years.

If the rules say it’s ok, is it ok?

Nice psa. Would happily do that without single care in the world.

As per Lardman and Daveylad - blame the game NOT the players :o)

The rules do not say it's OK

didn't people do similar with teh states when a bike was the same price in $$ as in ££, and it was 2 dollar to the pound..
take a BSO out to the US..buy and ride a new bike, adn bring the new bike back...?

DrP

And watches. Go to wherever buy the watch, post the documents and box back to your address. Forget to declare on your return.
With the saving you could get a nice week in New York thrown in with your rolex.

tax avoidance, not tax evasion

Its neither, it's smuggling. There is of course a grey area between whats a used product and whats a new one, until you sent the VAT refund forms in that is, as then you're actually stealing from the Norwegian gov not smuggling into the UK. You paid your VAT in Norway, and used it, imported into the UK as second hand as is your right to do so. Thats legit. Whats not legit is to later claim back your VAT from Norway.

But thats the fact, not a moral judgement.

You know that 'Nothing to declare' tunnel that you have to wander through at the airport. Yeah, that. It's not a loophole or clever tax avoidance. It'd be completely illegal.

Not quite sure about the ins and outs of what you’re suggesting. But, it just sounds like tax avoidance, not tax evasion.

If the rules say it’s ok, is it ok?

Erm no. The rulessay that you should pay the UK VAT when you drive off the ferry in Newcastle/Dover.

It's completely illegal. Evasion, not avoidance. <Edit. I'm probably wrong on this. Ben's point about smuggling is probably more accurate />

blame the game NOT the players :o)

Game rules are clear. Pay the UK VAT on import.

The rules do not say it’s OK

Agreed.

It's a socially accpetable crime, similar to all the other socially acceptable crimes.

Would happily do that without single care in the world.

based on some canyon QC horror stories I'd be wary of unboxing a bike from them and immediately pointing it down an alp.

With the saving you could get a nice week in New York Guernsey thrown in with your rolex

eek.. fixed that for you... 😉

DrP

well, it's not quite as simple as you all seem to be suggesting..
If something is 'used' you don't pay VAT on purchasing it, AFAIK?

What is 'used'?...
if it's a grey area, it's the very definition of tax evasion, Surely?

I used to go to the states alot, buy a bike, ride it around on holiday for a couple of weeks and bring it home. It was used, muddy, tyres worn.... HMRC considered that used?

I used to travel to Jersey for work regularly, and every time i went the hire car seemed to be brand new. Every single time. I queried it with the bloke on the desk and he said that this (national) company, bought all its cars in Jersey. did a few laps of the island, and then transferred them to other branches. i Don't know what import taxes they would pay on a car, vs the cost of a ferry ticket.

I used to go to the states alot, buy a bike, ride it around on holiday for a couple of weeks and bring it home. It was used, muddy, tyres worn…. HMRC considered that used?

Well whether or not that counts as used, you are still supposed to pay tax on it somewhere. The OP's tax evasion scheme is to claim that you're going to immediately export it (and claiming back the sales tax), then either:
a) Not exporting it immediately - E.g. by using it whilst on holiday within the EU (or wherever you bought it), or
b) Exporting it immediately but not paying tax on it when you bring it into the UK.

It's not a socially acceptable crime. You wouldn't tell your neighbour that's what you'd done.

If something is ‘used’ you don’t pay VAT on purchasing it, AFAIK?

Depends on the product. For example, if you buy a used bike from a VAT registered seller you would be paying the VAT on the difference between purchase price for the seller and what you paid, as far as I can remember. EG if they buy it for £800 and sell to you at £1200 ex Vat, you pay 20% on £400, so price to you is £1280.

That said thats not really relevant here, what is relevant is whether your bike is in fact new or used at the point of entry into the UK. If new, you need to pay Duty and VAT, if used, and imported for your personal use, you don't.... Sort of. Buying it overseas and giving it a ride first probably doesn't qualify it as 'used', whereas buying it overseas, doing a season in the Alps on it then coming back to the UK with it almost certainly would.

whereas buying it overseas, doing a season in the Alps on it then coming back to the UK with it almost certainly would.

YesBut in that scenario you shouldn't reclaim the EU VAT. Got to pay it somewhere.

<Sorry. I think I'm just repeating what you've already really said>

It’s definitely illegal because you are declaring to the Norwegian state that the bike is being exported as new on the U.K. state that is a second hand import. It can’t be both

It's an interesting area, which is pretty grey in tone. I'm a supporter of paying Tax, from a moral, social standpoint (in fact i do, lots of it) but if there are grey areas in the rules, then it's a matter of interpretation, which we have to leave HMRC to make a call on.

Example: (as checked and advised on from my accountant)
years ago, when i went on honeymoon to Patagonia, I was commissioned to take some photo's for the travel company who arranged the trip. They wanted some for their office walls.

I asked my accountant how much of the trip I could write off against tax. I was told, the trip as purely a photographic expedition would ALL be deductable, even from the quite small (a few hundred pounds) sale of 1 framed image. So long as the photo's could be used to build a business asset.

Question was, how much was me travelling to Patagonia for taking the photo, and how much was honeymoon? Should i close my eyes until I got there to take the photo? Should i eat only the cheapest meals, or rent the smallest car? In the end i had a lovely 2 weeks taking lots of pics, drinking, walking, horse-riding... and claimed around 60% of it. There was no way to find out enough detail to certify what is considered reasonable expenditure or not.

How long does something need to be owned to make it 2nd hand? or how long used?
Surely Grey area = avoidance, not evasion. I'm not an expert at all, only interested in others point of ' reasonable'.

How long does something need to be owned to make it 2nd hand? or how long used?
Surely Grey area = avoidance, not evasion

Nah. There may be some debate about exactly when something switches from new to second hand. But in this scenario, wherever that point is deemed to be, in order to make one of the country's taxes not applicable.... the other country's tax does become applicable.
There is no middle ground where the kayak/bike is second hand enough not to pay VAT on entry to the UK, but newly exported enough to excuse the buyer from paying the VAT in the Euro zone of purchase.

It's always either one or the other... (Ie, Not a gamma rayed cat)

I've bought stuff abroad used it then brought it home, snowbards and stuff, everybody does it with clothes or general holiday stuff but tax has been paid in the country its bought from. Still cheaper than here, so saves money. But tax is paid.

If tax isn't paid anywhere then it's tax evasion.

Surely the definition of second hand is that you are the second owner, not how old something is.

Colins Dictionary agrees -

Second-hand things are not new and have been owned by someone else.

I’ve bought stuff abroad used it then brought it home, snowbards and stuff, everybody does it with clothes or general holiday stuff

Essentially, if those items were over the threshold (currently £390) you've evaded UK import tax on those purchases*.

*Unless they were made in the EU when we were a member of the EU.

If tax isn’t paid anywhere then it’s tax evasion.

not sure this is the legal definition 😛

Essentially, if those items were over the threshold (currently £390) you’ve evaded UK import tax on those purchases*.

If you’ve claimed back the tax from Norway/Spain wherever you were in holiday you have... but why would you pay tax at the uk border on something you’ve paid tax on in the country of origin?

I think you are evading tax in the country of purchase.

If you buy something there and then use it there and bring it back, then yeah you don't pay UK tax on it.

But if you then say to the country of origin that you immediately exported it and so will pay tax in the UK, then thats a BIG FAT LIE to them but UK tax man has no interest.

Are they gonna chase you for it?

lardman
Free Member
It’s an interesting area, which is pretty grey in tone.

You can't just keep repeating it's grey when it's been explained to you in black and white.

Buy the bike, reclaim the VAT, go through the "anything to declare" line at the airport on the way back and pay the VAT there.

Having said that, I was looking at it the other day and the shipping costs for some brands are now more than the diesel, so there's a "free" holiday to be had there.

but why would you pay tax at the uk border on something you’ve paid tax on in the country of origin?

Basic Duty Free rules.

https://www.gov.uk/duty-free-goods/arriving-in-Great-Britain

So in that case are you then allowed to claim back the tax you paid when you bought the goods- as you have exported them? I am getting confused here as so used to travelling freely through the eu. Remember seeing shops offering tax claim back forms for non Eu visitors. In fact I think I might have seen that when travelling in the south east Asia in the early 90s. Bought a camera in Singapore. Brought it back to uk. Didn’t declare it. No idea what the limit was then.

You can’t just keep repeating it’s grey when it’s been explained to you in black and white.

Well, the specific bike related question seems to be clear now. It was more of an observation on 'grey' area around taxation rules generally.

Well, the specific bike related question seems to be clear now. It was more of an observation on ‘grey’ area around taxation rules generally.

Not really, if you import something (beyond the usual limits allowed for bottle of booze and a souvenier) you have to pay VAT and duty at whatever rate the UK government sets.

Some shops (inc Canyon) will waive the local VAT so you're not paying it twice.

Yes you could evade both via your original method. And yes HMRC might never know, but that doesn't make it legal or "grey". Whether it's a bike, a watch, camera, car or handbag it's the same rules.

So in that case are you then allowed to claim back the tax you paid when you bought the goods- as you have exported them?

Depends on the country and in some cases where you are in that country - e.g. you can't (IIRC) reclaim sales tax in New York.

I'm sure HMRC/Customs know this will happen, but not on a scale to bother them.