In part four of this series, an introduction to international exhibiting, you will learn more about shipping options and overseas tax. Initially, you may not think these two services have very much in common but soon you will see the correlation.
As in America, goods and services overseas can be subject to sales taxes. The good news is that you can reclaim VAT (Value Added Tax) and GST (Goods Services Tax) from Europe as well as Asian countries and Australia. There are companies that can help file the claim to get the tax money returned. Some large international shows in Europe will provide VAT refund service so be sure to check the exhibitor manual so see if that is available. Take time to learn what the requirements are from professionals to ensure you maximize your refund. Original invoices are required to file for refunds. When you receive quotes from stand builders, be sure to inquire if your project will be charged VAT or GST taxes as this will impact your costs with tax rates ranging from 10 to 27% in Europe.
The timeframe to file varies between countries as seen in the chart below:
- British - December 31st, for a reporting period of the previous July 1 through June 30th
- Other European Countries - June 30th, for expenses dated during the previous calendar year
- South Korea - June 30th, for expenses dated during the previous calendar year
- Japan - Within 2 months of the claimant's fiscal year end
Whenever you are shipping products or exhibit properties overseas, always be sure to use an exhibition freight company. Although large companies have in-house shipping departments, overseas trade show freight is different because of documentation and import/export guidelines. Working with an exhibition freight company will ensure your shipment travels, clears Customs using the most efficient import methods through to local delivery.
International exhibition shipping agents can recommend the best method of transport and importation. If you have a shipment that is traveling throughout multiple countries, a Carnet is a document that will expedite Customs clearance. Please keep in mind though that a shipment traveling on a Carnet must remain exactly as documented from start to finish, you cannot make ANY changes. For exhibit materials going to a show, ask about a Temporary Import Bond (TIB) that will have a lower cost for duty/taxes based on a percentage of the declared value. This is designed for shipments that will be imported for a short time, such as a trade show or special event, then exporting when the event is complete.
It is estimated by European tax offices, that 10% of the shipments of goods into Europe are being assessed import/customs VAT in error, due to incorrect or incomplete documentation. It is very difficult to receive a refund of this VAT, especially when an incorrect VAT identification number was associated with the transaction. This is another reason why working with exhibition freight specialist is so important. Not only will the shipment cost more than necessary if documentation is not done correctly, reclaiming excessive VAT may not be possible.
We hope this series has provided information to increase your comfort level when implementing an international trade show program or special event. The vocabulary lesson, learning about the different types of exhibits and options, tax and shipping overview should give you the confidence to help your company increase their market share. For all your international trade shows and events email us or call 817-370-1400.