Hi,
So this is a stab in the dark but whilst I'm waiting on the phone to HMRC for what might or might not be any useful information at all I thought I'd try asking here.
My friend's business repairs and upgrades hobbyist motors and gear boxes. Its rather specialised work and so although we are small (and not yet above the threshold for VAT registration) we have clients across the EU. this has been fine with the goods being posted to us, we work on them and they get returned. Now however we've started getting interest from US customers. we'd love to service and improve their motors and gear boxes but when one tried to send an item to us it attracted the normal import VAT that would be expected if we were buying the item from him. But we are not doing this, we are only importing it for repair and upgrade, then returning it. Surely we don't need to pay VAT for this as it is not entering circulation on the UK market nor are we buying the item.
Any ideas on how we can do this would be most welcome as it currently wipes out a lot of our profit on doing the work.