VAT Preparations for Brexit

Events in respect of BREXIT appear to be moving very quickly at the moment.

However, HMRC have published an open letter to businesses that trade in goods with the European Union. They offer some advice in what they say is “the unlikely event” that the UK leaves on 29 March 2019 without a deal. Whether, by the time you read this blog, this event seems unlikely or not is perhaps another matter!

The letter explains changes to Customs, Excise and VAT procedures and suggests three actions business owners should take now to avoid problems if the UK leave the EU without a deal being negotiated.

The three actions are:

  1. Register for a UK Economic Operator Registration and Identification (EORI) number at www.gov.uk/hmrc/get-eori. Businesses will need an EORI number to continue to import or export goods with the EU after 29 March 2019 if the UK leaves the EU without a deal. They will also need one before they can apply for authorisations that will make Customs processes easier for them. More information will be available on this early next year.
  2. Businesses should decide if they want to hire an agent to make import and/or export declarations for them or if they want to make these declarations themselves by buying software that interacts with HMRC’s systems. If they decide to:
    • declare through an agent, they should contact one to find out what information they will need.
    • use software to make declarations themselves, they should talk to a software provider to make sure that their product meets their needs, depending on whether they import, export or both.
  3. Businesses should contact the organisation that moves their goods, such as a haulage firm, to find out if they will need to supply them with additional information so that they can make the safety and security declarations for the goods. If the transportation supplier does not do this, the company needing the declarations may have to submit its own.

In addition to the letter, the Government has now opened a grant scheme to help support training and IT improvements for Customs intermediaries and traders that complete Customs declarations.

Julian Borley, Partner at Milsted Langdon, said: “It is important that businesses take adequate steps to prepare for the possible event of a no deal.

“The actions advised by HMRC are targeted at businesses that only buy goods from or sell goods to EU customer. It is likely that if a business imports or exports goods to or from countries outside the EU that it will already have the relevant EORI number and will use advisors to make the relevant Customs declarations.

If your business is likely to be affected by anything mentioned in the article above, or you are unsure about the actions required, then it is important to seek specialist advice. Contact us today to find out how we can help you.”

Posted in News.