We’ve got a confession to make: We have not been quite up to date on how VAT free buying works in Finland and the EU area at the moment.
For a company that is supposed to be at the forefront of selling Antiquities, Art and Design, this isn’t something that we’re entirely proud of. But even experts make mistakes, right?
Instead of shying away from these oversights, we thought we’d show you where we went wrong so that you don’t make the same mistakes. More importantly, we’ll show you what we did to fix them and how these solutions resulted in us working towards making VAT free buying easier in Finland.
The Importance Of Understanding The Laws On Exporting Antiquities, Art & Design
The Importance of Understanding the laws around exporting Art or Culturally meaningful Items, sits in a key role of understanding VAT free buying in Finland today. There are two authorities supervising the export of cultural Items: The National Board of Antiquities and the National Board of Customs. The NBA (National Boar of Antiquities) is the central licensing authority that gives advice and guidance in matters concerning the export of cultural objects. The NBC (National Board of Customs) is the authority that supervises the export of cultural objects.
The first step is to know whether or not the Item in question needs a separate export license. The NBA states the following:
“An application must be made for an export license for taking a cultural object out of Finland if the object belongs in the categories that are listed in the national Act on Restrictions to the Export of Cultural Objects, irrespective of the financial value of the object. If the financial value of a cultural object that is intended for export outside the EU also exceeds the value thresholds set in the Council Regulation, an EU export license for cultural objects must be applied for instead of the national license.”
Basically you can find this out by checking if the object belongs in the categories that are listed in the national Act on Restrictions to the Export of Cultural Objects.
If you happen to be so lucky that your object does not belong to the list, VAT free buying is a walk in the park for you! However this is usually not the case when buying Items from an Auction, since the list basically covers any- and everything you can think of. But don’t lose hope just yet! We have taken some serious steps in trying to make this law more sensible in Finland. You can read more about this, later in the blog post!
- My Item(s) are not on the list: Jump to step 3
- My Item(s) are on the list: continue reading
5 Problems (And Solutions) In VAT Free Buying We Learned
Step 1: Getting An Export License For Your Items
Export license for cultural objects
So now that you know, whether or not you Item(s) are classified as cultural object(s) (in Finland) or not, the next step is to file for an export license. The first thing you need to know about these licenses is that there are two types of them:
Step 2: Understanding the procedure
Hooray! You have now successfully overcome the first hurdle of knowing which form to fill. There are now three (3) steps you need to take whilst applying the export license:
- Fill in the form by hand or a typewriter and mail it to the NBA (no e-mail or telefax applications are excepted)
- Paying the license fee of 75 euros
- Attaching Three (3) photographs of the object or a detailed list of the objects to the license application.
You may get the actual application from the NBA by sending an e-mail to firstname.lastname@example.org
The NBA states the following on their website:
“Many different matters are taken into consideration when making decisions on the export license. The object may be rare or becoming rare or it may be especially significant from the perspective of national cultural heritage or be essentially connected with a valuable cultural environment, significant persons or events of national history. The decision may also be affected by artistic, scientific or historical viewpoints or other special reasons for which an export license may not be granted.”
Good to know:
- The license expires if the object is not taken out of the country within one year of the date the license was granted.
- The authorities make their decision on the basis of information in the application form and the photographs. It is, however, possible that the licensing authorities may want to examine the object in more detail or take photographs of it if necessary.
- If the licensing authority refuses a license for export and if the owner of the object so demands, the National Board of Antiquities or the National Gallery is entitled to redeem the object for the State.
Step 3: Picking A Reliable Delivery Company
Phew, you have now successfully detained most of the hurdles! Now it is VITAL that you pick a reliable Delivery Company, to take care of the rest. To be able to get your VAT refunded, you need to send the seller some much needed paper work and an experienced delivery company knows exactly what to do next.
Here are some points that we think you should take in consideration whilst picking a delivery company:
- It is best to pick a company that is Finnish, since they understand how the license procedure continues after this point
- An experienced delivery company knows what to do next, without you having to advise them.
- A company that specializes in packing and sending art and antiquities is worth considering for!
- You should also consider picking a company that already deals with auction houses, since they usually know exactly what each auction house requires as documents of the export (to then be able to refund the VAT to you)
At Auction House Helander, we have a few partners that we recommend our clients to use in such cases. Click here to find out more!
Step 4: Having All The Necessary Documents
The law in Finland states that for a seller to be able to refund or sell items VAT free, a third party needs to provide the seller with a reliable document on the export of the Items. In other words this means, that a delivery company has to fill some paper work with the Finnish customs or postal office and then send that paper to the seller. The Seller can apply the VAT back from the State only after receiving all needed documents.
Usually Auction Houses don’t want to risk on losing the VAT altogether and therefore opt for a VAT refund instead of selling the Items VAT free in the first place.
So at this point, there is only one last thing to figure out: which document is sufficient enough. Once again you have two options:
- If your purchase is valued under a 1000 euros, a document from the Finnish Postal office is enough
- In other cases you need a document from the National Board of Customs stating that the Item(s) have actually been taken out of the country
If you don’t wish to figure this part out yourself, the other option is to hire a reliable delivery company that will do the work for you.
Step 5: VAT Refund
Wuhuu, it’s finally time to get your money back! At this point there is only a couple of things you need to take care of before you are in the clear.
- Make sure you have provided the seller with your bank details (account number, swift/bic-code)
- It’s also crucial that you send your VAT number to the Seller
- Wait for your VAT refund, and remember that it takes time to wire money so be patient!
Okay so getting your VAT-refund is difficult enough without all of the very complex exportation rules around it. Whilst we truly believe that it is very important to protect and preserve the cultural heritage of each country, it should not be so hard.
What We’ve Done About It
Up until now we’d never had any real change to affect these rules, but this has finally changed! The owner of Auction House Helander Mika Sirén is now a part of the prepping group of the Finnish exportation law, concerning the exportation of Art, Antiquities and Design. One must keep in mind that this is still a law that concerns the whole of EU and the process might be a long one. But still there is hope in the end of the day!
What VAT issues have you run into? Share your experiences in the comment section below.
- VAT Basic Rules in the Eu by The Europian Union
- VAT Directive by The Europian Union
- The NBA (National Boar of Antiquities)
- The NBC (National Board of Customs)
Text: Jenny Sirén