Brexit, Duties, Taxes and Rules-of Origin

Now we have a bare-bones UK/EU Brexit deal, I can summarise how this will affect things:

tl;dr: EU customers can order as normal, the cost should still be the same. UK customers, if you use the price lists or configurators from HPVelotechnik or Hase, add 7% to the price.

  • Rules-of-Origin now apply to all imports and exports – basically, if 55% or more of something is made in the UK or EU, then duty won’t be charged. It gets quite complicated working out what “made” means, and this is a problem for many bike companies who make frames in the Far East and use mostly components also made in the Far East.
  • This means that most bikes I import – from HPVelotechnik, Hase etc – will now have 14% import duty added by UK customs. There’s nothing I can do about this, I’m afraid. Riese & Muller electric bikes manage to avoid this, by using Bosch electric motor systems that are made in Germany. But what I’ll do is split it with you, so you only need to add 7% to the price.
  • Some parts in the UK will also go up in price, if they’re bought from EU distributors, but the duty on bike parts is 4% compared to 14% on complete bikes.
  • Most things I export – Bromptons, Brompton upgrade kits and parts – do meet rules-of-origin, because I manufacture the frame parts here in Scotland. So they should not attract duty when sent to the EU.
  • I can also send EU orders as DTP – that’s Delivered Tax Paid, so you pay the VAT to me just like a UK customer, and then I pay the courier to clear your order through customs, the order should just arrive with you as if you’d ordered from the EU. This is also a new thing, so again there might be some teething problems but we’ll work them out.
  • The slight advantage/disadvantage with DTP, depending on where you are, is that VAT rates vary across the EU – so depending on where you are, if your VAT rate is different from the UK’s 20%, then you might slightly win or lose this way, but only by a small amount.