Collector's Piece Need Not be High Value

Those wishing to import collector’s items from abroad will be heartened by a recent decision of the High Court.

When items are imported, there is usually a requirement to pay VAT on them and, where applicable, duty. One exemption from the charge to duty is when the item imported is a ‘collector’s piece’. It is established case law that to qualify as a collector’s piece an item must be:

• relatively rare;
• not used for its original purpose;
• the subject of special transactions outside the normal trade in similar items; and
• of high value.

With regard to value, HM Revenue and Customs (HMRC) operate a rule of thumb definition that this means the item is worth more than £20,000.

Recently, a taxpayer imported a Ford Zephyr car, which was valued at much less than £20,000, and claimed that the collector’s piece exemption applied. HMRC disagreed and the matter came to court. The taxpayer won. The court held that an arbitrary value could not be applied to determine whether or not an item was a collector’s piece. The essential test is whether the item has a high value relative to that which it would have were it not a collector’s piece.