I need to ship my electronic mags back to the USA for shock load inspection and I want to be sure to avoid import duty when they are returned.
I’ve spent quite some time researching this and it seems one needs to employ “outward processing relief” or “OPR”.
I’ve spoken to a shipping agent and they’ve just quoted me a ridiculous £700 shipping.
Anyone got any experience with this and willing to offer advise please?
Shipping cost is a formula of weight and volume and speed. Import duties, or not, has nothing to do with it.
Most helpful, thanks……
There is no import duty on “aircraft parts”.
The practical problem, which repeats itself constantly, and I got one only yesterday, is that the US vendor usually forgets to put those words prominently all over the paperwork. Putting them on the box is no good because customs clearance doesn’t usually involve looking at the actual goods
The bigger problem is import VAT. As a non VAT registered end user you have to pay it, on the value of the work done.
£700 is totally mad. Should be about £100 each way. Fedex has offered us good rates recently; I sent an oil sample to the US for £25, which amazed me. There are also companies which take 1-2 weeks and which are much cheaper; I recently sent a D3000 mag and an alternator (total weight 10kg+) for £50. I can find out who we used on Thursday.
By far the easiest and cheapest way is to use freight forwarding (an agent handle a US address for you and ship from that address). I only recently discovered this, and if I had discovered it earlier, I would have saved several €k in shipping for sure. On average, the shipping cost is half of what the “normal” cost would be.
It’s much cheaper because shipping inside the US is cheap, often free, but using fed-ex etc is very expensive. Shipping one little item is insanely expensive (in relative terms) than shipping larger packages. The freight forwarding agent re-pack lots of packages from those addresses into larger shipments, and still use fed-ex or whatever.
I’m not entirely sure they handle packages to the US though, but see no reason why not since there is bound to be returns. I use JetCarrier
But again, VAT, duties etc has nothing to do with this. This is something between you and the state. When sending something to the US (or anywhere else) for repair, you pay VAT for the cost of the repair and the cost of the shipment (that’s what we do in Norway, and this handling is done online with the customs office separately, before or afterward). Doing a simple purchase from the US, JetCarrier handle the VAT and everything as well.
Regarding getting preferential and competitive air freight rates from/to the UK and Germany, try https://www.transglobalexpress.co.uk/.
I have my own DHL account with preferential rates (essentially a discount of 50-70% over published rates) and their rates are pretty much the same as the DHL rates I get and they (and other similar companies) essentially pass on preferential rates of various express air freight carriers. I have used them a few times within the EU when the rate of a different carrier was cheaper than DHL but have not had experience with customs clearance with them for shipments from/to outside the EU.
I therefore don’t know how well they handle “outward processing relief”. In the DHL account case, I have got DHL doing that and the customs process in general for me. Not sure whether TG Express does it themselves or whether they rely on DHL, UPS etc to do it for them. It’s probably worth checking with them how they deal with OPR for magnetos you are looking to ship.
A very important aspect to avoid “import duty” (different from VAT) is to ensure the right HS code which carries the civil aircraft exemption based on the TARIC database (https://ec.europa.eu/taxation_customs/dds2/taric/taric_consultation.jsp?Lang=en#) is listed in the commercial invoice and that a relevant Authorised Release Certificate is clearly included as an attachment to the commercial invoice. Please also see https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=uriserv:OJ.L_.2018.256.01.0058.01.ENG which has the official statutory exemption text which shows which HS headings/subheadings that are covered by the exemption (essentially always make sure you use the duty-exempt HS code) and the list of acceptable ARCs.
Thanks wbardorf, very helpful.
“outward processing relief”
The problem is to do this properly you have to file a case with a central customs system through an agent etc. As a result for smaller items up to maybe 10k or Euro it is not worth the effort. I just send the parts to the US labelled as value 0 for repair. Once they return they will usually charge me the import vat on the total of the invoice attached for the shipping which will be the overhaul cost. That is not the perfect procedure but the easiest.
The risk is that customs could say you did not export it properly and now you have to pay import VAT on the whole thing, core value plus overhaul price. Did never hppen to me but I would be afraid on a whole engine and similar items.
When buying overhauled parts and returning your core later try to make them put only the price excluding core value on your invoice and to take a security on your credit card for the core. Else you will end paying import VAT on the core value which can be significant.
Finally aircraft parts are duty free but some providers like UPS/FedEx charge extra for that procedure. So for smaller items it is easier to pay the general duty of 2,7% instead of paying UPS/FedEx for the special aircraft parts procedure.
I just send the parts to the US labelled as value 0 for repair.
I send stuff to the US routinely, for overhaul etc, and I make up a Commercial Invoice with some nominal value like $100 (for a magneto) and in big letters I put on it
TEMPORARY EXPORT TO THE UNITED STATES FOR REPAIR AND RETURN
and that seems to work. I’ve never heard a beep from the US destination saying they had to pay import duty on it.
When it comes back, there may or may not be import duty levied depending on whether the magic words AIRCRAFT PARTS have been put on the paperwork Given the “facebook generation reading only one line”, about 50% of the time they are not… Obviously if it was an engine then I would kick up a fuss with the courier and make then get it re-classified. It happened with the TKS system and got it corrected; the crates had AIRCRAFT PARTS all over them but not on the paperwork, and in modern times customs clearance does not involve looking at the goods… it gets done by muppet+computer while the goods are on the 747 at FL300.
The company we got good rates from for outbound shipping was this one and hey they are carbon neutral so Greta will love too
I’ve never heard a beep from the US destination saying they had to pay import duty on it.
I’ve never paid any duty or tax on any vehicle parts I’ve imported to the US over 35 years, obviously including civil aircraft parts as these are duty free by two way treaty. The issue there is return to Europe.
DHL will get the parts to a US address eventually but they often use USPS for delivery (DHL infrastructure in the US is not extensive) and that process is cumbersome in my experience. Cost allowing, I’d recommend Fedex for shipments to the US and DHL for shipments to Europe.