Does your business import or export?

Does your business import or export goods?

If your business imports or exports goods either as sales or in your supply chain, there are a number of things you need to do and be aware of with the end of the Brexit transition period ending on 31 December 2020.

 

FROM 01 JANUARY 2021
the EU Customs Union and VAT regime will no longer apply to the UK. As a result, importers of goods from the EU into the UK (excluding Northern Ireland) will need to deal with new customs tariffs, declarations and import VAT rules. A different VAT and customs regime will apply to Northern Ireland.

Custom duties in the UK are a tax levied on imports. Currently there are no tariffs on trade within the EU customs union, but unless the UK reaches a free trade deal with the EU, they will apply to UK-EU trade.

 

KEY STEPS ALL IMPORTERS AND EXPORTERS SHOULD TAKE NOW

  • Make sure the classification of your goods (tariff/commodity code) are correct
  • Use the government trade tariff tool to look up commodity codes, duty & VAT rates (gov.uk/trade-tariff)
  • Ask HMRC for help to classify your Apply for a legally binding tariff information decision
  • Ensure your company is registered for both imports and Apply for your EORI
    • From 01 January 2021 you will need an EORI number to move goods between the UK and the EU
  • If you already have an EORI: Check your EORI, does it start with ‘GB’? If not apply for a new one
  • Be ready for the new customs paperwork. Speak with your customs broker or import - export agent or look at setting up your business to make declarations internally
    • Regardless of whether a deal is reached between the UK & EU, import and export customs declarations will be required for the movement of goods as of 01 January 2021
    • Exporters are urged to speak with their customs broker or import-export agent who acts on their behalf to secure the service they need beyond the 31 December 2020 or look at setting up your business to make declarations
  • Check the new UK tariff for imported goods, as the UK will apply a UK-specific tariff to these
    • From 01 January 2021, the UK will apply a UK-specific tariff to imported goods. This UK Global Tariff (UKGT) will replace the EU’s Common External Tariff, which applies until 31 December 2020

 

IMPORT VAT

Businesses will need to plan how they wish to pay UK import VAT when new customs and VAT regime takes effect. There are a number of options to consider:

  • Defer the import VAT payment through Brexit Postponed Accounting in your VAT return
  • Pay at Customs when goods arrive in the UK
  • Ask your customer to pay under Delivered At Place Incoterms. This is the least likely alternative as your customers may be unwilling to pay it

 

UK INTRASTAT DECLARATIONS

Currently VAT registered businesses in the UK are asked to complete Intrastat declarations in which they report movement of goods from the EU and into the UK. HMRC has indicated that despite Brexit, Intrastat declarations will still be required for imports from the EU.

 

USEFUL RESOURCES:


Here to Help


To help businesses prepare for Brexit, we have produced some helpful materials including:

  • Preparing for Brexit: A Guide for SMEs (including helpful links to tools and further resources); and 
  • A 15-point Action Plan.

Preparing for Brexit

To receive your free 'Preparing for Brexit: A Guide for businesses' and '15-Point Action Plan' please fill in your details below and helpful resources will be on their way!