Temporary importation for artworks and collectibles in Belgium

Bringing artworks, design furniture, or collectibles into Belgium typically incurs Value Added Tax (VAT) upon importation. The applicable rate depends on the nature of the goods: artworks benefit from a reduced rate of 6% and are exempt from customs duties, while most other items, including furniture and decorative objects, are subject to the standard 21% VAT rate.

However, when the permanence of these items within Belgium or the European Union is uncertain—such as for temporary exhibitions, sales, or restorations—VAT doesn’t always have to be paid upfront—alternative solutions exist. In such cases, Belgium customs offers temporary importation mechanisms that allow for the deferment or exemption of VAT and duties, if certain conditions are met.

Why choose temporary importation?

Temporary importation procedures enable the entry of goods into Belgium without the immediate payment of VAT and customs duties, under the condition that these goods will be re-exported within a specified timeframe. This approach is particularly advantageous for items intended for exhibitions, auctions, or sales, where the final destination is not yet determined. By utilizing temporary importation, importers can avoid the financial burden of upfront tax payments, thereby improving cash flow and reducing administrative complexities associated with tax recovery processes.

There are three primary temporary importation regimes in Belgium, each tailored to different needs and offering distinct benefits and considerations:

Classic temporary import (IM53) with direct deposit

Under the IM53 customs procedure, importers can temporarily bring goods into Belgium by providing a direct security deposit to customs authorities. This deposit, which can be made through a direct payment or by opening a secured customs account, covers the amount of VAT and any applicable duties that would be due if the goods were permanently imported. Once the goods are re-exported and the temporary importation is properly concluded, the security deposit is refunded.

Advantages

• Cost efficiency: managing the security deposit internally eliminates third-party fees, making it a cost-effective option for businesses with sufficient liquidity.
• Full refund: upon successful re-exportation and compliance with all procedural requirements, the entire deposit is reimbursed, ensuring no financial loss.

Considerations

• Cash flow impact: the need to tie up funds for the duration of the temporary importation period can strain cash flow, especially for high-value items.
• Administrative burden: the refund process can be lengthy, often taking between 6 to 12 months, and requires meticulous documentation to ensure compliance and timely reimbursement.

This method is best suited for companies with robust financial resources and the administrative capacity to manage the complexities of direct security deposits and subsequent refunds.

2. Temporary import (IM53) with third-party deposit

Alternatively, importers can opt for the IM53 procedure facilitated by an authorized third party, such as a customs broker or freight forwarder, who provides the necessary security on behalf of the importer. In this arrangement, the importer pays a periodic fee to the third party for assuming the financial guarantee.

Advantages

• Preserved liquidity by outsourcing the deposit requirement, importers can maintain their cash reserves for other operational needs.
• Simplified process : the third party handles the intricacies of the customs procedure, reducing the administrative workload for the importer.

Considerations

• Recurring costs : the fees paid to the third party are non-refundable, representing a sunk cost regardless of the duration of the temporary importation.
• Potentially higher expenses over extended periods, the cumulative fees may surpass the costs associated with direct security deposits.

This option is ideal for businesses seeking to minimize upfront financial commitments and administrative responsibilities, particularly when dealing with frequent or short-term temporary imports.

3. Bonded warehouse (IM71)

The IM71 procedure involves storing goods in a bonded warehouse, where they are considered to be outside the EU customs territory for tax purposes. While in the bonded warehouse, goods are exempt from VAT and customs duties until they are either re-exported or formally imported into the EU.

Advantages

• Tax deferral : VAT and duties are not payable while goods remain in the bonded warehouse, providing financial flexibility.
• Secure storage: bonded warehouses offer secure and controlled environments, ensuring the safety and preservation of valuable items.

Considerations

• Restricted access : goods cannot be removed from the warehouse for any purpose, including exhibitions or viewings, without initiating a customs procedure and potentially incurring taxes.
• Limited flexibility : any movement of goods out of the warehouse requires compliance with customs regulations, which may involve additional paperwork and costs.

This regime is particularly beneficial for importers who require long-term storage solutions without immediate plans for the goods’ distribution or sale within the EU.

Summary Table

Need expert assistance?

At Embelco, we specialize in the comprehensive management of art and valuable object logistics, offering services that encompass customs clearance, secure storage, and transportation. With over 75 years of experience, we understand the intricacies of temporary importation procedures and are equipped to navigate the complexities on your behalf.