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kennyk

UK VAT - Zone Activated Mininum Order Amount

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I'm a U.S. based company that ships to the UK.  With the new UK VAT requirements I've decided I won't be accepting orders less than $200 USD.  This allows me to avoid having to have a UK VAT number and collect and send collected VAT to the UK.  We're running OSC v2.3.4 and need a Minimum Order Amount that is ZONE activated.  I believe other U.S. companies who ship to the UK will be interested as well. I searched and found a could Minimum Order Amount modules.  However, none were activated based on Zone(s).  Any suggestions or modules that already exist would be greatly appreciated.

Kenny

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There are many ways to do this.

Easiest option would be a Hook, but as you are on an ancient version of osCommerce that might not be available to you.

In which case use a header_tag module, this module would fire on checkout_shipping.php;

  1. look at destination country
  2. look at order value

If 1 is UK and 2 is <200, redirect back to shopping_cart and show a message "You have $180 in your cart, spend $20 more for shipping to UK" (or whatever).

Keep things simple.  Simple is always good.

Edited by burt

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6 hours ago, burt said:

There are many ways to do this.

Easiest option would be a Hook, but as you are on an ancient version of osCommerce that might not be available to you.

In which case use a header_tag module, this module would fire on checkout_shipping.php;

  1. look at destination country
  2. look at order value

If 1 is UK and 2 is <200, redirect back to shopping_cart and show a message "You have $180 in your cart, spend $20 more for shipping to UK" (or whatever).

Keep things simple.  Simple is always good.

Thank you Burt for the reply and information.  I do utilize Hooks and use them for the PayPal and Braintree modules.  While I am fairly capable at modifying modules and code for my purposes I am not a "developer" of code.  So, either method is out of my capabilities.  If there is an existing hook or a header_tag module that does something that would be relatively easy to modify let me know.  Otherwise, if there's someone you recommend that might be interested in developing it for the community or for me (for hire) let me know.

Thank you again!

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3 hours ago, Nige-A said:

This might be of interest to people selling to Britain after Brexit.
It might be daunting to read but might also answer a few questions.

VAT and overseas goods sold directly to customers in the UK - GOV.UK (www.gov.uk)

Thanks Nigel.  Let's hope the entire world does not follow UK's VAT collection model for not UK e-commerce.  I can't imagine having to collect and maintain taxes like this for ever country we ship to.  Nightmare!

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3 hours ago, Nige-A said:

This might be of interest to people selling to Britain after Brexit.
It might be daunting to read but might also answer a few questions.

VAT and overseas goods sold directly to customers in the UK - GOV.UK (www.gov.uk)

 

Quote

 

Overview

From 11pm on 31 December 2020, consignments of goods with a value of £135 or less that are outside:

  • the UK and sold directly to customers (not through an online marketplace) in Great Britain (England, Scotland and Wales) will have UK supply VAT charged at the point of sale
  • the UK and EU and sold directly to customers (not through an online marketplace) in Northern Ireland will have import VAT charged

 

(emphasis added)

Wouldn't an online store with a shopping cart (even if based outside of the UK) be considered a "online marketplace" ? Or, am I misinterpreting this?

M


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40 minutes ago, ArtcoInc said:

 

(emphasis added)

Wouldn't an online store with a shopping cart (even if based outside of the UK) be considered a "online marketplace" ? Or, am I misinterpreting this?

M

With the online marketplace I think they mean the likes of eBay/Amazon, not your own shop


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@puddlec

Perhaps, but then again ...

Sometimes, it's easier to ask for forgiveness, than it is to ask for permission :)


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30 minutes ago, ArtcoInc said:

@puddlec

Perhaps, but then again ...

Sometimes, it's easier to ask for forgiveness, than it is to ask for permission :)

True, the UK goverment are notvalways known for making things clear, with what you can and cannot do


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1 hour ago, ArtcoInc said:

@puddlec

Perhaps, but then again ...

Sometimes, it's easier to ask for forgiveness, than it is to ask for permission :)

UK is indicating any package from outside the UK under the stated value that has not collected VAT will be returned to the sender.  So, asking for forgiveness will cost you all the shipping charges involved.

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In that case, I guess we ALL shops outside of the UK that sell internationally will need the header-tag module (or hook) that does what @burt stated:

13 hours ago, burt said:

There are many ways to do this.

Easiest option would be a Hook, but as you are on an ancient version of osCommerce that might not be available to you.

In which case use a header_tag module, this module would fire on checkout_shipping.php;

  1. look at destination country
  2. look at order value

If 1 is UK and 2 is <200, redirect back to shopping_cart and show a message "You have $180 in your cart, spend $20 more for shipping to UK" (or whatever).

Keep things simple.  Simple is always good.

One additional suggestion ... have the module block the check-out function if the total is less than the specified amount (adjustable in Admin).

( hint: maybe a supporter code module?)

M

Edited by ArtcoInc

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If you are selling into UK from outside the EU, the VAT rules have not changed for you.

Only EU businesses selling directly to consumers in UK and selling more than £70k goods into UK per year need to make changes, otherwise they continue to charge tax at their local rate and account for it locally (unless they choose to register for UK VAT).


For a new install or if your store isn't mobile-friendly, get the community-supported responsive osCommerce (Phoenix).

here: on the official osc download page

Working on generalising bespoke solutions for Quickbooks integration, Easify integration and pay4later (DEKO) integration at 2.3.x

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@BrockleyJohn  This is new for me John.

I suppose you have figured this out, do you have a reference of documentation? Website or something?

I will look for it myself here in the local government websites too.

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33 minutes ago, René H4 said:

@BrockleyJohn  This is new for me John.

I suppose you have figured this out, do you have a reference of documentation? Website or something?

I will look for it myself here in the local government websites too.

I don't think anyone has it figured out - including the respective governments! There's extra complication because some of the UK is sort of still in the EU - and maybe the 70k threshold still applies only to selling from the EU into Northern Ireland rather than the rest of the UK, which was the context of the last conversation that I had about this.

This is the main landing page for EU businesses for changes due to brexit:

https://www.gov.uk/eubusiness

If I read the following page correctly, it means that if you sell orders under £135 into UK then the new system will be that you collect the VAT and account for it with the UK. It is supposed to be moving from the existing system of collecting the VAT on entry to the country to a system where it is collected at the time of sale. Once this system is active it will apply equally to EU and non-EU merchants who are not selling through a marketplace.

https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

If this were organised sensibly, your UK tax registrations and payments will be handled through your local tax handling rather than directly with UK tax authorities, but I have no faith that the practice will be sensible!!


For a new install or if your store isn't mobile-friendly, get the community-supported responsive osCommerce (Phoenix).

here: on the official osc download page

Working on generalising bespoke solutions for Quickbooks integration, Easify integration and pay4later (DEKO) integration at 2.3.x

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31 minutes ago, BrockleyJohn said:

If I read the following page correctly, it means that if you sell orders under £135 into UK then the new system will be that you collect the VAT and account for it with the UK. It is supposed to be moving from the existing system of collecting the VAT on entry to the country to a system where it is collected at the time of sale. Once this system is active it will apply equally to EU and non-EU merchants who are not selling through a marketplace.

https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

If this were organised sensibly, your UK tax registrations and payments will be handled through your local tax handling rather than directly with UK tax authorities, but I have no faith that the practice will be sensible!!

In the U.S. we have been informed that WE, the e-commerce merchant, selling into the UK from the U.S. must have a VAT number and collect the 20% VAT on orders under £135 (~$180 USD) and then remit collected VAT taxes quarterly to the UK.  We have been told that failure to collect VAT with a VAT tax ID will result in the package being sent back at our expense. Orders with a value over £135 VAT will be collected by the UK.  This is why we are looking to have a minimum order value of $190 USD for orders shipping to the UK. 

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My understanding is that product value (note not order value as shipping etc is not included) needs to exceed £135gbp (in shopowner currency equivalent) to take shopowner away from the onus of VAT registration etc.  Under £135gbp product value...shopowners worldwide have to sign up for UK VAT and submit records etc.

This is for WORLDWIDE shopowners selling into the UK as far as I can make out.

Which means that some shopowners who are not registered for VAT in their own country, need to be registered for VAT in another country.
Note that this same system is due to be introduced EU wide in June (so I have read, though I don't remember where I read this).

The simplest option for some (most?) businesses is to simply stop selling into the UK for values less than £135 equivalence (product value).


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Addendum:  I can see lots of shopowners (across all ecommerce software) getting parcels returned because of this. 
Costing the shopowner in time and money, and in time taken to get back to the customer and tell them why their package has returned to sender. 

Then, of course, because the customer did not get the package, you shopowner need to refund the customer. 
If that's with Paypal, you lose the fee.  You lose time, you lose effort.

You also have an unhappy customer who is likely to "word of mouth" how crap the situation is, potentially losing you future buyers.


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34 minutes ago, burt said:

My understanding is that product value (note not order value as shipping etc is not included) needs to exceed £135gbp (in shopowner currency equivalent) to take shopowner away from the onus of VAT registration etc. 

OK - yes - total value of products in the consignment (not including VAT either).

Plus if you're shipping from the EU there's a bunch of new extra paperwork.


For a new install or if your store isn't mobile-friendly, get the community-supported responsive osCommerce (Phoenix).

here: on the official osc download page

Working on generalising bespoke solutions for Quickbooks integration, Easify integration and pay4later (DEKO) integration at 2.3.x

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1 hour ago, burt said:

Note that this same system is due to be introduced EU wide in June (so I have read, though I don't remember where I read this).

https://ec.europa.eu/taxation_customs/sites/taxation/files/vatecommerceexplanatory_28102020_en.pdf

(July - limit 150 euros for the products bit)


For a new install or if your store isn't mobile-friendly, get the community-supported responsive osCommerce (Phoenix).

here: on the official osc download page

Working on generalising bespoke solutions for Quickbooks integration, Easify integration and pay4later (DEKO) integration at 2.3.x

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If the package is returned you also lose the initial shipping costs and depending on the shipper the return shipping costs (which are often higher than the original).  I agree with Burt that the easiest thing to do is no longer ship to the UK.  However, that's not the most profitable solution.  If something similar is going to go into effect for the EU then we really need the ability to implement minimum order valve per country. 

Also, when you do an international refund the customer almost always ends up shorted because of exchange rates and such.  Then they want you to make them whole which costs you more.  So, I really need to prevent orders that fall under the £135gbp from being submitted.

Edited by kennyk

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If anyone else wishes to begin restricting what countries they ship to, due to the current and possibly upcoming VAT regulations, here's a list.

Countries in the UK:

  • England
  • Scotland
  • Wales
  • Northern Ireland

Countries in the EU:

  • Austria
  • Belgium
  • Bulgaria
  • Croatia
  • Cyprus
  • Czechia
  • Denmark
  • Estonia
  • Finland
  • France
  • Germany
  • Greece
  • Hungary
  • Ireland
  • Italy
  • Latvia
  • Lithuania
  • Luxembourg
  • Malta
  • Netherlands
  • Poland
  • Portugal
  • Romania
  • Slovakia
  • Spain
  • Sweden

(I guess Greece never did make it out, did they?)

At one time, there was an add-on that allowed quick and easy administration of the available countries through Admin.

https://apps.oscommerce.com/aKZPh&active-countries

Unfortunately, it has not been updated in years, and required massive core-code changes.

HTH

Malcolm


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27 minutes ago, kennyk said:

So, I really need to prevent orders that fall under the £135gbp from being submitted.

👍


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1 hour ago, BrockleyJohn said:

Documents like this make me sweat. It's getting very complex. They are killing international trade in this way, and weren't we ( the small businisses) the ones that keep the economy alive?

I hate men with suits and ties.

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If I read the document well, I understand that for larger companies there will hardly be any changes per june 1st.

There is a threshold per country at this moment, if your sales to that country are above that the company has to pay VAT in that specific country, even befor june 1st. This threshold is someting like 35000 Euro's at this very moment.

As per june 1st, there will be a threshold of 10000 Euro's for orders that ship to all countries together.

You can pay the tax at your local TAX organization, by requesting an XXX ( I read the term but I can't find it back) for each country and administer it there.

This is how I read it. 

This would also mean the end of Intracommunautary deleveries?

 

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If possible please try to keep the discussion on the business aspects of what shopowner needs to do (or wants to do) to make their shop work the best way they can for their needs.  I've hidden away a couple of posts which added little/nothing to the conversation (more about politics/eu/uk than about ecommerce/solutions).  

Edited by burt

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