Brexit: What Are the VAT Changes for Goods Purchased From Overseas?

24 December 2020

From 1 January 2021, the UK will leave the European single market and customs union, which will impact the way businesses transact with the EU. This will result in many changes in how you account for VAT on goods you import or export from the EU.

You’ll need to make customs declarations when you import goods from the EU. These rules currently apply to importing goods from the rest of the world, including Switzerland, Norway, Iceland and Liechtenstein. 

You can make the declarations yourself, but most businesses use a courier, freight forwarder or customs agent.

You may be able to delay making a declaration for up to 6 months after you imported the goods.

A licence is only required if you are importing animals, plants, food, agricultural products drugs, chemicals and waste.

The rules for importing some types of goods will change. You will need to check:

You will need to ensure that you have an EORI number.

You also need to know whether custom tariffs apply to the goods you import – you can look up commodities here.

You can pay VAT and customs duty when your goods enter the UK, or you can set up a duty deferment account to make one payment a month. In some cases, you may be able to delay paying VAT and custom duty.

If you regularly import goods using Common Transit, you can apply for consignee status to make the importing process quicker.

The EU business you’re importing from will also need to prepare for 1 January 2021.

Before the business sends you any goods, check they can make the necessary export declarations. They’ll also need a licence or certificate to export some types of goods.

Find out what else is changing here.

If you have any questions regarding the above, please don’t hesitate to contact us.

Please note: This article is a commentary on general principles and should not be interpreted as advice for your specific situation.

Brexit: What Are the VAT Changes for Goods Purchased From Overseas?

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