How to sell goods bought abroad

Shopping in an online store abroad

We continue to answer questions related to online commerce. In this article, we will discuss whether it is possible to buy goods from foreign online stores and sell them in Ukraine.

If an entrepreneur decides to buy goods on Aliexpress for a song and resell them in Ukraine, no one can prohibit him or her from doing so. No special permits are required for this, unless it is a product that is subject to licensing.

Payment

Payment for goods from a non-resident on a website, such as Aliexpress or eBay, is made using a payment card, either a regular plastic card or a virtual card (Internet card). After the latest updates to the currency control rules, entrepreneurs and legal entities were allowed to make payments in both hryvnia and foreign currency once a day under one foreign economic agreement for the amount of up to UAH 400 thousand (if the payment is in dollars, it must be recalculated at the current exchange rate and the payment amount should not exceed the equivalent of UAH 400 thousand).

Without concluding a separate foreign economic agreement, you can transfer up to 400 thousand hryvnias by regular bank transfer. If the amount of your purchase exceeds the permissible limit, the bank will not be able to make the payment without concluding a written agreement with the online store. In order for the bank to purchase foreign currency for your payment to a non-resident seller, you will need to provide them with a contract, invoice, and other documents. If the purchase amount is less than UAH 400 thousand, then the bank buys the currency and conducts the transaction without additional documents.

Documents

Even before the payment is made, we recommend that you discuss with the non-resident seller the procedure for preparing the documentation for the goods. In addition to the contract and invoice, which you will need when making payments in the bank and then when customs clearing the goods, you will also need shipping documents: shipping invoices, quality certificates, documents confirming the country of origin, and others.

Important point! All documents must be drawn up for the company or individual entrepreneur, and not for the person (employee) who makes the order in the online store. In addition to the fact that properly executed documentation will be required for inventory accounting, the procedure for customs clearance of the parcel and the cost of customs clearance will also depend on the correctness of the documents.

Customs payments

Goods (other than excusable goods) worth up to EUR 150 sent across the border in the form of parcels are not subject to customs clearance, no customs declaration is required, and they are not subject to customs duty and VAT. If a parcel (or several parcels, but the sender is the same) worth more than EUR 150 is received on the same day from the same sender, then such parcels must be declared (customs declaration), customs duty and import VAT must be paid.

If you order goods from a foreign online store as an individual (not an entrepreneur), then the VAT-free threshold for imported parcels is up to EUR 100.

Accounting

If the goods purchased in a foreign online store were paid for with a corporate card, then the purchase amount must be recorded as money issued for reporting. Upon receipt of the parcel, the employee must prepare an expense report. The received goods are posted on the date of the advance report. It must be accompanied by documents confirming receipt of the goods. The cost of the goods must be converted into hryvnia at the NBU exchange rate on the date of the advance payment.

Repatriation tax

When you transfer money to a foreign seller for goods, you do not need to withhold withholding tax, also known as repatriation tax. The non-resident's income is exempt from taxation.

In the next article in this series, we will talk in more detail about the restrictions and peculiarities for sole proprietorships that sell through an online store.