We are now less than one month away until the UK officially leaves the European Union. For businesses, this means new processes, protocols and procedures.
In this blog, we are going to explore how your business can approach just two of these issues: customs and VAT.
Here’s what you need to know.
After the UK leaves the EU on 31 December 2020, the Government will be free to impose its own customs and VAT regimes.
Until now, the UK and the EU have shared the same customs and VAT schemes, which made moving goods between the UK and the EU seamless and simple.
However, there are now a set of actions your business must do if it is to continue trading smoothly and avoid disruption. This includes:
- Hiring or training a customs intermediary to complete and submit declarations
- Applying for a duty deferment account, enabling duties to be paid once a month rather than on individual consignments
- Preparing to pay or account for VAT on imported goods
- Ensuring you have International Driving Permits, and
- Applying for a GB Economic Operator Registration and Identification (EORI) number.
If you are a business who imports or exports products overseas, you may be entitled to grant funding to cover the cost of recruiting, training and adapting your business to the new demands of global trade. For more information, get in touch with our expert team.
While most UK businesses will be able to rely on specialist customs intermediaries to process goods, VAT will likely prove more difficult.
The VAT rules around importing and exporting goods to and from the single market will change after the end of the transition period. This includes when and where VAT should be accounted for.
Although VAT will now be payable on import on goods from every country (including the EU), the Government will introduce a new “postponed VAT” accounting regime to help businesses avoid cash flow issues. This scheme will enable you to account for VAT on imported goods on your next VAT return and goods can be released from customs without the need for immediate payment.
For help and advice on related matters, please get in touch with our expert team today.