Brexit Hub

VAT Rules for Post-Brexit Trade

Download our guide for navigating your way through VAT for trading under the new rules.

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Importing Goods from the EU

Understanding the new rules will help you keep compliant, avoiding unnecessary delays.

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Exporting Goods to the EU

You must now make customs declarations when exporting goods to the EU.

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Importing Goods by Post

The process for importing goods from the EU by post has changed.

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Customs Declarations

From 1 Jan 2021, if you're importing goods, you must complete an import declaration.

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Getting an EORI Number

As of 1 January 2021 you need an EORI number to move goods between the UK and the EU.

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Options for Ecommerce

New VAT rules mean there are new procedures to follow - so what are your options?

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Brexit Action Checklist

What should you review to make sure you are compliant with the new rules?

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Data Sharing & Security

Are you still compliant with data protection regulations? Read this guide to find out!

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EU VAT Package Guide

On 1 July, the European Union (EU) will introduce the 2021 EU e-commerce VAT package.

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Frequently Asked Questions

No. Distance selling thresholds allowed UK VAT to be charged until the value of the goods sold to an individual country exceeded a certain threshold, beyond which local VAT became a requirement or the customer was left to foot the import VAT bill. The latter remains an option post-Brexit, but the seller may instead choose to register and pay recoverable import VAT and then charge VAT to the customer. The EU rules will be simplified from 1 July, 2021 with the extension of the One Stop Shop for e-commerce businesses, removing the need to register in individual member states.

Postponed VAT accounting and deferment account are two different schemes.

Deferments Accounts

If you import goods regularly, you can apply for a deferment account to delay duty / VAT. A deferment account means one payment a month (15MFD) rather than by consignment. A deferment approval number (DAN) is issued by HMRC upon approval. An agent can defer payments on your behalf against your DAN.

Postponed VAT accounting (PVA)

From 1 January 2021, if your business is registered for VAT in the UK, you are able to account for import VAT on your VAT Return on goods that you import into Britain from outside the UK. Accounting for import VAT in this way means that you’ll declare and recover import VAT on the same VAT Return, rather than having to pay upfront and recover it later.

If you choose to go down the PVA route, you will need to take the following steps:

When you complete your customs declaration, select that you’ll be accounting for import VAT on your VAT Return. You'll need your EORI number or VAT number to hand.
Register here to access online copies of your monthly postponed import VAT statement. This will show the total import VAT postponed for the previous month. You’ll need your Government Gateway user ID and password, which is linked to your EORI number. A copy of the statement will be needed to complete your VAT Return.

You will also need to register for online statements. Your accountant cannot register on your behalf as an agent.

A business can also choose to pay import VAT upon arrival and reclaim it in the normal way.

Movement of goods for repair is not subject to duty or import VAT. This is called inward processing. Authorisation to use inward processing to process or repair goods means that a business will not pay customs duty and import VAT on goods imported from outside the UK and then returned. To apply for inward processing, you need to be established in the UK and have an EORI number.

Full authorisation allows you to use:

inward processing regularly
simplified declarations to import or export your goods

Authorisation can be applied for online.

The gov.uk references are here and here. Inward processing was available prior to 31 December 2020.

The seller will need to register for VAT in the country in which the inventory is held (import VAT). The seller will also need to register for VAT where the customer is situated, subject to distance selling thresholds. Such thresholds will be withdrawn in July 2021 upon the implementation of the IOSS (see VAT Guide to Brexit). There are no UK VAT implications.

Yes. Rules of origin refers to where goods have been produced or manufactured (not necessarily from where goods were shipped). The Trade and Cooperation Agreement mandates that goods must originate in the EU or UK to benefit from preferential duty rates. If goods do not meet rules of origin requirements then duty will be payable both on movement into the UK and re-export to the EU.

Double duty can be mitigated by customs warehousing. A customs warehouse can be used to store goods that are liable to duty and / or import VAT, including goods for re-export. You can use custom warehousing to pay only when goods leave the warehouse. You need not pay duty and VAT if you re-export your goods. Conditions must be met before approval as a warehouse keeper is granted.

Triangulation refers to shipping goods to one EU country and invoicing another. Triangulation meant that the VAT registered UK intermediary did not need to register for EU VAT. Prior to Brexit, the manufacturer would zero-rate its sale to the UK. A UK VAT number can no longer be applied in that triangulation. If, however, B registers for VAT in country C then A can zero-rate its sale to the UK.