Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
You have a problem here. If the goods are shipped to the UK then on arrival Customs may assess an Import Duty (there are literally hundreds of these, but the rate for this would appear to be of the order of 5.6%) and also apply VAT. The Duty would form part of your cost of sales and the VAT would be an input, reclaimable on your quarterly return if you are registered for VAT. However, Customs do not always charge Duty and VAT on importation, the procedure can be very erratic. Shipping direct to the States is an obvious way round this difficulty.
I do hope that you find my answer of assistance.
In general terms you have. The problem is that Customs do not always bother to charge Duty and VAT on importation so you can never be sure which way the Customs cat will jump from day to day. The solution to this conundrum is, as I told you, to have the item shipped direct to the States.
Oh, I see, your original question was a tad obscure and could be read as though you had an US customer. Clearly there is no point in a double shuffle.
So you are importing direct from Nepal, thus the actions of Customs have a direct bearing and you will have to see which way they act on the day. It really is as tricky as that. Remember Customs are really trying to stop importation of illegal items so quite a bit of simply routine stuff gets through without intervention.
Correct, very boring, but that is the reality of the situation. You have the calculation wrong, it will be Import Duty upon which VAT will be added. Also the rate of Duty may be incorrect, there are simply hundreds of different rates.
10K plus 5.6% = 1056 plus 20% VAT =12.672K.
Also it is a rug; Customs may take one look at it, impound it and consign it to the furnace; particularly if it is a part animal product..
I have worked in Nepal so I know just how tricky Customs can be on imports!
Indeed, you must take shipping and insurance into the base price for the application of VAT.