VAT, Duty and Customs 2017 - DECLARE YOUR PURCHASES

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For the many of you that reached out asking me to elaborate on the VAT/Duties process I made reference to here, this is what I can share to help prevent others from being in a similar situation.

In recent months, based on the experiences of individuals known to me the following has happened. I will attempt to explain each scenario.

1. Purchased an exotic Birkin from FSH, completed all VAT formalities. Upon arrival into the US did not declare. The following day received a call from Customs mentioning the above. Customs offered two scenarios: to confiscate the bag/items or to remit 100% duty/penalty.
2. Purchased items from London/Paris (smaller items, clothing etc.), completed all VAT formalities. Upon arrival into the US did not declare. Was pulled aside and detained for 2 hours while they searched all items, even worn items were questioned. Checked through her books/purse for any receipts and charged duty and penalty. I believe largest item was an Hermes mini evelyne. Was told their Global Entry status could be revoked.
3. Purchased Cartier jewelry from Monte Carlo, completed all VAT formalities. Upon arrival into the US did not declare. Received a letter at home a week later telling them their Global Entry status could be revoked, penalties and duties were charged..

It seems there is a connection between the VAT process and the Customs now. In the past, although it was always expected that you would declare your items exceeding the limit, if you chose not to and got through… the story was over. Recently it would appear there is some communication between the VAT refund/your passport and customs.

I strongly advise you to NOT to experiment and DECLARE your purchases at arrival. Pay the duties.
Leather goods is typically no more than 4% of the purchase. It’s not worth the risk and consequences. I do not have any “actual process” details but I want to share these three scenarios that I have become aware of in recent weeks.

Please add any details or stories you may have below.

Additional articles:

Chapter 6: How It Works – VAT Refund and Custom Duties
Chapter 5: Luxury Brands VCA and Hermes Adjust Prices for Devalued Euro
Chapter 8: Mom Needs to Make Some (Hermes, Chanel, VCA) Memories!

 

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An update from my dear friend DREAM whom we call the “Traveling Shopping Diva”.
She just returned from a family vacation in Italy. All four of them were traveling together (parents + kids). Landed and cleared customs at JFK with a connection.

I just got off the phone with her and this is her experience and some tips.
She declared absolutely everything she bought, in fact said she went over in her estimations to be on the safe side. She placed everyones shopping items together in one suitcase and had all the corresponding receipts with her handy in one place. The officer matched up each item to each transaction on every receipt. Despite this, the officer went through all 4 suitcases and all 4 carry-ons searching for items that may have not been reported. Dream and her family were there for over an hour while he searched and in the process of the wait, DREAM asked a few questions. I am going to try to highlight the main points she explained to me.
1. Of the 4 traveling, only the husband wrote the total amount (shopping) that needed to be declared. The rest (other 3) said NO to all questions, including the $800 exemption. The officer advised NOT to do this, but to split up purchases per person on the Global entry form. So for example, let’s say total was 10K, the officer wanted to see corresponding shopping for each passport… not all one one. Keep this in mind.
2. Be sure when calculating total spent, you don’t just add up large VAT refund eligible purchases but the smaller spends that you may not have applied for VAT refund for also. Apparently the woman before DREAM only declared her VAT eligible items and upon inspection when other items were found a 6X penalty was applied to the non declared items. DREAM suggests declaring everything. COMPLETE TRANSPARENCY.
3. In order to be completely transparent, one needs to be organized. DREAM explained that on her next trip she was going to create a journal and log every item purchased and not just VAT items as it is easy to inadevertantly miss something… especially when traveling with family and the kids are independently shopping too. The detailed and very thorough inspection from the customs officer left no room for error or miscalculation despite DREAM’s honest declarations.
4. The officer questioned other items in their suitcases that were not new from this trip. DREAM and her college aged daughter had many Chanel shoes and slides, their Gabrielle and Boy bags… along with many other luxury items. DREAM was traveling with a Birkin too. The officer questioned the purchase dates of each item and suggested that in the future they should travel with receipts or photographs documenting time and place before departure. Fortunately for them, we had logged the Chanel Gabrielle story and the earlier Boy bag stories here at PurseBop.com (read: http://www.pursebop.com/handbag-math-you-can-still-save-money-buying-chanel-abroad-chanel-gabrielle-bag-case-study/ and http://www.pursebop.com/hermes-is-your-best-buy-in-paris/
This seems like a tremendous amount of work in preparation for travel but DREAM said the way HE questioned and inspected, there was no room for any ‘white lies’. The officer was courteous throughout their time but EXTREMELY THOROUGH. She asked the officer what they do if passengers have connections and don’t have this much time? The officer replied – IT’S NOT OUR PROBLEM. WE DON’T CARE. WE WILL DO WHAT WE NEED TO DO – WE TAKE OUR TIME. Fortunately DREAM’s family had several hours before connecting to Chicago. She said they were there for over 1 hour.
5. DREAM collected their VAT in cash at kiosks throughout Italy in the cities but advised that the person whose passport was used for the purchase/receipt was the one who had to collect, so be cogniscente of this also. Make sure the person whose passport was used at purchase is the same person that collects VAT. They made this mistake a couple times and it was a waste of time after standing in line as they would not dispense refunds to other family members.

All in all, we can only reinforce the importance of TRANSPARENCY when shopping abroad. This is one persons experience, of course everyone will have a different one. DREAM is a seasoned traveller and shopper from all parts of the world and has found with each trip their is increased scrutiny. I hope sharing her experience prepares you better for your travels this summer. Please don’t hesitate to ask questions. Will do our best to reply.

To learn more explore the new TRAVEL and HANDBAG MATH GUIDES on the site http://www.pursebop.com/guides-2/

Love PurseBop
XO

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I was wondering if any of you are non-american but fly thru USA in order to go to Europe.

I’m from South America, I do not hold a USA passport/residency/etc, and I’m planning my trip to Europa thru USA (ofcourse i will do some shopping in EU). Do I still have to declare it at the US customs if i’m just in transit (for 2 days) in the USA (Miami to be specific). I will ofcourse show my return ticket to my home country….

My other flying option is to fly out directly from south america (it would be a very long flight), thus, have any of you had to declare your good in any of the Latin countries……….?

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All of this info is so helpful – I am so glad someone told me about PurseBop! I’m traveling to France and Italy later this year and want to make a few purchases. Hopefully a new LV bag and a Goyard. SN: I also feel like I’ve found “my people” on PurseBop. #homesweethome

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If you can afford the purchase, you can afford to pay the duty on it –

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It never pays to try to avoid taxes. Someone I know failed to declare her purchases, was searched, fined and put on a watch list so that she is checked every time she comes into the country. I have always declared and, despite trying to pay my tax, was waved through on multiple occasions. And, as Purse Bop says, penalties and fees will add up to an amount way more than you would have paid had you just declared your purchases.

  • Pursebop

    Thank you for sharing this. I was petrified when my girlfriend shared her story. Her husband was frantic waiting outside not knowing where she had vanished to. She texted from the aircraft that she landed but for two hours was held in a small room. They would not let her use her phone to even call him. Things have really changed in recent times. I also heard it was a good way to deter resellers bringing leather goods into the country for the secondary market. Declaring the purchase documents it more than just on your credit card statement.
    Yes, I will not attempt any shenanigans after what all I have heard. Buy, complete VAT refund requirements and DECLARE on arrival.

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