A jewellery business can be a viable one as it has a strong market and good potential. It is one of those sturdy businesses, the demand for which may never be zero. The market could be volatile though, because it involves precious natural resources and the price can go very high or very low depending on the world trade and economy. Jewellery, gold and precious stones are viable investment options for the end users. It can be the same for businessmen too, provided they are ok with locking money in these products. It can be artistically rewarding too, if the jeweller also designs pieces. Jewellery can be a passion for owners, but when it is a business, one needs to comply with the laws of the land.
The following points need to be considered when one is looking to manage a jewellery business in the UK.
- Any jeweller planning to start an online or physical shop in the UK needs to purchase a license from the local council. This license has some conditions which you need to follow or otherwise you will be fined to the tune of 1000 pounds.
- HMRC requires submission of a tax return and self-assessment at the end of each tax year and pay for national insurance as well.
- Every business in the UK has to abide by two specific laws too – The Sale of Goods Act (SGA) and Trade Descriptions Act (TDA). SGA lays down that the products are as advertised and have an acceptable quality. But if these conditions aren’t met then the customer can return or exchange the goods. TDA prevents the seller from selling counterfeited items. Both these laws are made for the protection of the consumer.
- The UK also requires that all metals should be hallmarked, based on the Hallmarking Act of 1973. Any transactions that have precious metals and that haven’t been hallmarked are illegal.
- All jewellery sold in the UK has a charge of 20% VAT on the item. So, if one is buying engagement rings in hatton garden, there will be a levying of VAT charge on the purchase.
The following are some legal requirements that jewellers need to comply with to function in the EU market.
- The General Product Safety Directive applies to all products sold in the EU. If there are no specific directives for jewellery, this one will surely apply.
- The EU also follows the REACH regulation which specifies which hazardous chemicals can be bad for the skin because jewellery is in close contact with it. It aims to protect human health. The full form is Registration, Evaluation, Authorisation and restriction of Chemicals. It restricts the use of harmful chemicals in jewellery manufacturing and protects the health of jewellery purchasers. Metals like nickel, cadmium and lead must be used with caution in manufacturing.
- Hallmarking is necessary for silver and gold jewellery to verify the content of metals. However, the rules for precious metals is not harmonized and each member state has its own rule.
EU also has some non-legal requirements such as Business Social Compliance and Ethical Trading initiative. Because UK was a part of the EU, a lot of the rules are similar to EU rules. So, for example, jewelers hatton garden will also be making sure that the customers are protected.