If EU buyer pays via bank transfer what happens with IOSS / VAT?

[wellingnorth]

If an EU buyer wins an auction for an item under £100 and pays via ebay then usually the buyer's local VAT % is added to the payment and the IOSS number added to the order.

What happens if the buyer instead pays via bank transfer? Am I right in thinking that I would ask for the listed price only, mark as paid in My Ebay and then send outside of the IOSS scheme, ie with import VAT to pay on arrival? Or would ebay somehow charge me the VAT later on?

[myriad*seller]

The goods would be stopped by customs and the import VAT and duty would be added on arrival in the EU, and the buyer will be billed for this. 

Buyers not expecting this would normally leave the seller negative feedback so make sure you warn the buyer they will have to pay extra when it arrives in their country 

[*vyolla*]

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@wellingnorth wrote:

What happens if the buyer instead pays via bank transfer? 

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Why would a buyer agree to pay via a payment method outside of eBay checkout that offers them zero protection against their item not arriving or not being as described if it does?

[wellingnorth]

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@myriad*seller wrote:

The goods would be stopped by customs and the import VAT and duty would be added on arrival in the EU, and the buyer will be billed for this. 

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This is what I assumed would happen, but I wanted to check have you actually had this happen?

[wellingnorth]

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@*vyolla* wrote:

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Why would a buyer agree to pay via a payment method outside of eBay checkout that offers them zero protection against their item not arriving or not being as described if it does?

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This was a request from a buyer in Germany, maybe they don't have a credit card, I'm not sure, but was interested to know the implications for buyer + seller.

[myriad*seller]

German buyers prefer to use bank transfer 

I think they do have some protection for bank transfer in Germany, although not sure how eBay Buyer Protection works over there 

[wellingnorth]

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@myriad*seller wrote:

German buyers prefer to use bank transfer 

I think they do have some protection for bank transfer in Germany, although not sure how eBay Buyer Protection works over there 

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Yes I think the bank transfer is fairly safe for me to receive isn't it? My thought was whether ebay might somehow try and charge me the VAT after I'd marked the order as paid, seems unlikely but you never know!

[myriad*seller]

The *buyer* pays import VAT, as they are the importer

Not the seller 

[*vyolla*]

If your buyer is in Germany and paying with bank transfer via eBay checkout then they should be charged the VAT when they pay. 

[wellingnorth]

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@*vyolla* wrote:

If your buyer is in Germany and paying with bank transfer via eBay checkout then they should be charged the VAT when they pay. 

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Interesting, what the buyer was suggesting was a direct bank transfer to me, but you're saying that as part of checkout on ebay they'll be offered a bank transfer option which I suppose would be a bank transfer to ebay instead, then ebay remove the VAT and send the rest to me via managed payments in the usual way?

[4_bathrooms]

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@wellingnorth wrote:

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Interesting, what the buyer was suggesting was a direct bank transfer to me, but you're saying that as part of checkout on ebay they'll be offered a bank transfer option which I suppose would be a bank transfer to ebay instead, then ebay remove the VAT and send the rest to me via managed payments in the usual way?

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I don't think the buyer can pay via bank transfer using eBay checkout.

Was the item sold via eBay's Global Shipping Programme?

Is this an order awaiting payment? If so, what is shown in the order details; does it show any German VAT being charged to the buyer?

[wellingnorth]

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@4_bathrooms wrote:

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I don't think the buyer can pay via bank transfer using eBay checkout.

Was the item sold via eBay's Global Shipping Programme?

Is this an order awaiting payment? If so, what is shown in the order details; does it show any German VAT being charged to the buyer?

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This is not an actual order yet, but would be shipping direct, not via GSP. I'm tempted to agree just to find out what happens. My guess is that if payment doesn't go through ebay it doesn't fall under the IOSS scheme and VAT would be charged on arrival .

[*vyolla*]

I seem to recall that bank transfer is a payment option at checkout for German eBayers, but stand to be corrected there. 

If they don't,  they certainly do accept debit cards and I would've thought that it would make more sense for your buyer to pay this route if they want some kind of bank funded payment. 

[tommystrezures]

It is an acceptable form, we have buyers too from Germany, who prefer to pay by IBAN. Generally you'll also need your swift BIC (Bank Identifier Code) too.

I think the crux here is if you invoice the buyer, post the auction ebay will think that the buyer is going to pay via their system, at which point vat/ioss would be added. However if you messaged the buyer post sale with the cost of the item and your postage charge (preferably tracked) and asked them to pay this amount, then you'd not need to add the vat element as this would be charged locally by the German authorities. This is how we have managed it on the few times we have had to do this, and not only with European customers. We had an Australian buyer who preferred to pay via iban, and when the FvF's were deducted the Australian GST (ABN) was not added. However on the CN22's we would not include anything eg IOSS etc so the buyers were charged locally.

In the past when we have marked as paid only Fvf have been deducted no extras etc. Now we haven't done one of these for probably a year or so now, but this is how it worked for us in the past.

[wellingnorth]

Thank you very much, that's helpful to know that that's all worked okay! If this does go through I'll avoid sending them an invoice.

[tommystrezures]

Not a problem and you are welcome.

The only thing i would add as I think previously mentioned when you send the total to the buyer, just remind them that they are liable for any taxes/duty etc. I think the German Vat rate (on our last order was 19%) but there are exemptions or reductions on what you sell etc. Good luck!

[4_bathrooms]

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@*vyolla* wrote:

I seem to recall that bank transfer is a payment option at checkout for German eBayers, but stand to be corrected there. 

You are correct. I remembered if you simply change the .co.uk to .de you get the German version of the page - eBay is really just one website. You just need to use the browser's translation tool to read the page. It seems an intermediary (Klarna) is used.