Brexit: What Are the VAT Changes for Goods Sold to Overseas Customers?
From 1 January 2021, you’ll need to make customs declarations when exporting goods to the EU. These rules currently apply to shipping goods to 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.
These changes are being introduced to ensure that EU and non-EU countries are treated in the same way and that UK businesses are not disadvantaged by competition from VAT free imports.
The rules for exporting some types of goods will change. You should check:
- What export licenses or certificates you need
- The marking, labelling and marketing standards for food, plant, seeds and manufacturing goods
- The rules for exporting alcohol, tobacco and certain oils
You will need an EORI number that starts with GB.
You can charge customers VAT at 0% (known as ‘zero rate’) on most goods you export to the EU.
You may be able to use Common Transit to move your goods more quickly to the EU, Switzerland, Norway, Iceland and Liechtenstein.
The EU business you’re exporting to will also need to prepare for 1 January 2021.
Before sending the business your goods, check they can make the necessary import declarations. They’ll also need a licence or certificate to import some types of goods.
Find out what else is changing here.
If you have any questions regarding the support available, 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.