Costing a Consignment from Abroad

A question about : Costing a Consignment from Abroad

Hi

I was wondering if somebody could help me with costing a consignment from China.

If I was to buy a container worth Ј10,000 and for argument's sake everything in that container cost Ј1 each. I assume I would pay Ј2000 VAT on those goods and let's say it costs me Ј100 on duties and Ј500 freight, door to door. In total, the consignment has cost me Ј12600.

Therefore, does that mean each item in the container has cost me Ј1.26 or do I take the 20% VAT off my costings and say each item had cost me Ј1.06.

Am I doing my sums correctly in the first place or is what I have written correct. Any help will be grateful.

Thank You

TDG

Best answers:

• You need to be VAT registered to work out what it cost you ex-VAT. If you are, it's the latter but be aware you then have to charge VAT to the next person in the chain (who may or may not be registered, so may or may not reclaim it). Pricing for retail must always be inclusive of VAT if you are registered.
  Just a note that duty and freight figures etc may be a little low, so guessing you're using sample figures just for the sums. For a container you'd be wise to use a shipping agent to receive and clear the goods for you, otherwise every day it's on bonded standing is going to cost more whilst you sort things out. And you'll need a crane or hiab to unload the container on arrival
• Coming by sea there are lots of extra costs - these are for a recent import from China. This was a part container load value about 2500 pounds.
  IMPORT LCL THC (GENERAL) GBP Total 103,13
  IMPORT DOC GBP Total 85,00
  DESTINATION CHARGES GBP Total 28,13
  CAF GBP Total 18,75
  IMPORT CUSTOMS CLEARANCE GBP Total 60,00
  DEFERMENT FEE GBP Total 15,00
  IMPORT LCL DELIVERY GBP Total 91,00
  In addition there was of course VAT and a carriage charge from Felixtowe where the boat landed.