The Taxman Cometh: Importing your Kickstarters from the US into the UK

It is plain that pledging to a Kickstarter to fund a new line of miniatures or a new table-top game is rapidly becoming a very popular way for people to add to their miniature and games collection. But beware. If the campaign you pledge on is in the US (as many of them are, and you are somewhere else in the world, such as in the UK where I am, you may have to pay import duty and VAT before you can tear off the shrink-wrap.

The Kickstarter-Craze of Today

I have blogged excessively about Kickstarters recently. They are a remarkable phenomenon and they are quickly transforming the industry. Companies such as CoolMiniOrNot have turned Kickstarters into an art-form with their massively popular Zombicide, Sedition Wars and Relic Knights games. Their next offer, Wrath of Kings, appears to be at the ready. The downright insane Reaper Bones Kickstarter is heading towards 2.5 million US$ now with over 11.500 fans pledged to the cause. Me? I threw my hat into the phenomenal DreamForge Kickstarter recently.

Many of the people supporting these wonderful projects are likely not living in the US. Personally, I am writing this post from my home in the UK Midlands. And just like me – when I get my new DreamForge toys – everyone importing their Kickstarter-loot from abroad will likely be confronted by the taxman!

As easy as the money flows across borders through the Web 3.0 media of Kickstarter & Co, it may be just easy to forget that there’ll be the rather old-fashioned HMRC waiting for its due when the games and miniatures ship back.

What will it cost me?

I am not a tax adviser. I can give you no professional advice. Not for the UK and much less for imports into other countries. But since I made some quick calculations of what I will likely have to pay to HMRC, I thought I’d share them here.

Here are the basic elements of what may be added as additional costs.

1. Import Duty
2. Value Added Tax (VAT)
3. Import Handling Fee

Import Duties for the UK are customs duty and excise duty. Excise is for alcohol, tobacco, etc.. , so I ignore them here.

Customs duty varies depending on what is imported. The UK import duty for board games s is luckily rated at 0%. Some websites say pure miniatures run at 4.7%. Others note they are free at 0% too. If someone with more insight knows more, I’d love to hear from you. Duty is only collected for shipments worth more than £135.

VAT will likely be your biggest concern if you import things from the US as a hobbyist. VAT in the UK is now 20%. Please note that VAT is calculated on the basis of the value of the entire order, including shipment, etc.. . Here’s what HMRC has to say about that:

The import VAT percentage rate is applied to the total value of the goods. In the case of goods brought in this is the sterling equivalent of the price paid abroad, as shown on the receipt. In the case of goods posted from outside the EU, it is the amount on the Customs Declaration, which includes the price paid for the goods, the cost of transport, postage and packing, insurance and any duty that may be payable.

Finally, whoever does the shipment will likely charge an import handling fee for doing the paper-work, running the boxes through their x-rays or whatever.

Here’s a brief overview of the most common ones:

• Import handling fees by Royal Mail: £8 per parcel liable for customs charges
• Import handling fees by DHL for import to UK: £1.25, or 2% of the import duty & taxes due, whichever is the greater.
• Import ancillary service fees by FedEx vary on the country of import.
• UPS charges include a disbursement fee of minimum $5, a transportation handling fee and a pre-release notification fee for import shipment

So how does that all translate? Here are a two examples.

Example 1: US$ 100,- “Vampire Pledge” from Reaper Bones

I’ll start with the immensely popular “Vampire Pledge” from the Reaper Bones Kickstarter (including the US$ 25,- shipment). Of the roughly 11.500 backers of the Reaper Kickstarter 10.500 have backed this particular pledge. Many of them likely in the UK.

At today’s USD/GBP exchange rate of 0.6313, the USD 125,- for pledge + international shipment add up to be £78.92.

So if you pledged for this and live in the UK, that is 95 quid. The handling charge (e.g. £8 for Royal Mail) is added on top of that.

There is no import duty as the total value is below  £135,-.

Example 2: US$ 300,- “All your base are ours!” pledge for Leviathans from DreamForge

This is a more sizable pledge and the one I signed up to with DreamForge Games. These are the taxes I will face. Though DreamForge is more of a niche, some of the CMON pledges (e.g. “Gotta Get Them All” for Relic Knights) will get you into the same field.

At at today’s USD/GBP exchange rate of 0.6313, the USD 330,- for pledge + international shipment add up to be £208.34.

In this case, I also added the import duty of 4.7%. It might be 0%. As I am not quite sure however, I’ll rather be on the save side.

Either way, if you also add a handling charge, then the entire shipment will not clear customs for any less than £60,- extra; over and above your Kickstarter pledge and any shipment.

Lessons Learnt?

So to wrap up a long post with rather less enjoyable contents: Enjoy your Kickstarters, but don’t forget to add the taxman to your budget! The sums can be quite sizable. And if you’re not in the UK, check your countries import customs for the exact numbers.

Z.

P.S.:

If anyone knows more about import duty for miniatures to the UK, let me know below! It’ll be much appreciated.