VAT on imported items

The following is in the nature of general information and guidance. Following it does not guarantee that any imported item will not be detained and possibly destroyed by Border Force nor that the lower rate of VAT will apply. Neither the Token Society of Great Britain nor any of its members shall incur any liability for any financial loss or any criminal sanction incurred by the reader as a result of placing reliance on it. It is your responsibility to gather adequate information to establish the nature, age and legality of any item imported and you are solely responsible for the consequences of not doing so.

Under sections 21(4) and 21(5) of the Value Added Tax Act 1994 the VAT on certain imported goods is set at 5% of their value (actually the value is treated as being reduced to 25% of its actual value and the full rate of VAT applied but the effect is the same). The value of the goods will normally be treated as the purchase price of the item(s) imported as stated in the shipping documentation. Goods to which this applies are, (section 21(5)):

(a)  any work of art;

(b)  any antique, not falling within paragraph (a) above or(c) below, that is more than one hundred years old;

(c) any collection or collector’s piece that is of zoological, botanical, mineralogical, anatomical, historical, archaeological, palaeontological, ethnographic, numismatic or philatelic interest.

Section 21(6) defines “work of art” for the purposes of this Act. It is unclear whether a gendaito or other art sword not an antique would be considered a work of art within the definition given here. However, consider the application of section (b), namely antiques. Antique blades and wartime blades (being of historical interest) should qualify for the reduced rate.

Where an item is sent abroad for restoration or authentication, assume that VAT at the full rate (currently 20% or as varied from time to time) is payable on the cost of the services received.

Tips and suggested procedure

Whilst doing the following will not guarantee that a parcel will not be held up, it may help to smooth the flow of an item into the UK both from the point of view of the criminal law (importation of prohibited weapons) and that of paying the appropriate rate of VAT (note, there is normally a handling charge payable in addition to any VAT):

• Lay a paper trail: if sending an item abroad for restoration etc, have or create documentary evidence that it was in your possession and, if necessary, legal to own prior to being sent away; or

• Make and provide copies of the sale advertisement, website links, authentication papers included with the item and retain any sales invoice or payment remittance advice as a record of price paid and description;

• Contact Border Force (eg, parcelforce@ups.co.uk or pfw-ccb@parcelforce.co.uk) to let them know what you intend: that you are sending an item away and will be expecting its return or are expecting to receive an item and how you can prove it qualifies for the lower rate of VAT and, if necessary, that it is legal to own it in the UK;

• Ask the seller to state the age of the item on the paperwork (an approximate age if not known exactly) and include year of manufacture, eg if blade made in Kanbun period (Apr 1661 - Sept 1673), estimated date as 1661 or a date in the Kanbun period, to the best of your knowledge and understanding

• Ask the seller to state, for a blade, that it was handmade by traditional Japanese methods if that is the case. If not an antique, ask the seller to state that it is of historical interest or a work of art;

• Ask the seller to include the appropriate Harmonised Tariff Code on the paperwork as found in Chapter 97 of the Integrated Online Tariff: Chapter 97 IOT

• Ensure the parcel is appropriately packed by the sender to prevent damage to the items being shipped or injury to people handiling it during transport or examination. Label it as fragile or sharp, as appropriate.

• Be honest about the value of (price paid for) the item or services received.
  

Offensive weapons laws

The following is an outline of the laws relating to offensive weapons in England and Wales. Other countries within the United Kingdom may have different laws.

Please read the following disclaimer:

If you have any issue of a legal nature resulting from the purchase, ownership, transportation, sale or importation of any item; or have any doubt as to the legality of any item in your collection or any item that you are contemplating importing, buying or selling, please seek the advice of an appropriately qualified legal professional. This document is for information purposes only and is not intended to be a definitive statement of the law. No liability of whatsoever nature shall be incurred by the Token Society of Great Britain nor any of its members as a result of reliance placed upon it. It is your responsibility to gather adequate information to establish the nature, age and legality of any item and you are solely responsible for the consequences of not doing so.

The following, relevant to collectors of antique arms, may constitute a crime in England and Wales unless the person accused has a lawful excuse for doing so.

The following is not exhaustive:

• Having an offensive weapon in a public place (this need not be a bladed weapon i.e. a Jutte or Sodegarami would be caught by this; and ‘public place’ includes a road or highway);

• Having a pointed or bladed item in a public place;

• Having bladed articles or offensive weapons on educational premises;

• Importing prohibited weapons*;

• Selling or offering for sale offensive weapons*; and

• Keeping offensive weapons on private premises*.

  
  

  *Of particular relevance to collectors of Japanese swords and related items is the explicit prohibition of curved blades with a cutting edge longer than 50cm; sword sticks (“Shikomezue”) and, for those that have them, various “ninja goods” such as kusarigama.

The following are potential defences to an accusation of an offence listed above and that are most likely to be relevant to owners of Japanese swords (not all will apply in every case):

• The item is an antique (defined as being manufactured more than 100 years before the date of any alleged offence having been committed);

• The weapon was made available to a museum or gallery in certain circumstances;

• If a curved blade longer than 50cm, that the weapon was made prior to 1954;

• If a curved blade longer than 50cm, it was made according to traditional methods of making swords by hand;

• The weapon is one of historical importance;

• The weapon was in the accused’s possession only in their capacity as the operator of, or as a person acting on behalf of, a museum or gallery;

• The weapon was in the accused’s possession for educational purposes only.

It should be remembered that the onus is on the accused (“YOU”) to be able to demonstrate that one or more of the above exceptions applies. Furthermore, it is an offense to sell any of the following to a minor (being under the age of 18 in the UK): any knife, knife blade, razor blade, any axe, any sword or any other article which has a blade or which is sharply pointed and which is made or adapted for use for causing injury to the person. Selling any of these items to a minor is a criminal offence to which the above exceptions do not apply.