Brexit

Get a personalised Brexit checklist from gov.uk/transition.

The supply of services to the EU is being brought into line with existing arrangements for the supply of services to non-EU countries. In general, this is determined by the 'place of supply'. For businesses to business sales, the place of supply is usually where the customer belongs. While for business to consumer sales, the place of supply is usually where the supplier belongs.

If the place of supply is outside the UK, or the services come under the 'use and enjoyment rules' and are used and enjoyed outside the UK, they will be 'outside the scope' of UK VAT.

In addition, you no longer need to complete an EC Sales List when supplying services to businesses in the EU.

Steps to take now

• Make the most of warehouse space you have in the UK by importing high turnover stock by 31 December 2020.

Changes

• You will need to make customs declarations (your courier, freight forwarder or customs agent should be able to do this for you).

• You will need to pay VAT and duties.

• Include the additional costs in your prices and cashflow forecasts.

• You will need an EORI number.

Recovering VAT paid on imports

• Postponed VAT accounting (PVA) will enable you to recover VAT paid on imported goods in your usual digital VAT return for goods valued at more than £135 (exc VAT) provided you:

  • elect to use PVA on your customs declaration

  • use your own VAT registration and EORI numbers on the customs declaration

• Xero are introducing PVA capability in their MTD for VAT returns software.

Find out more, including applicable tariffs, at gov.uk/prepare-to-import-to-great-britain-from-january-2021.

• You will need to make customs declarations (your courier, freight forwarder or customs agent should be able to do this for you).

• Check if you can charge VAT at 0%.

• You will need an EORI number.

• You may need to register for VAT in the EU country you're selling to if you are distance selling to consumers and the total value of the goods is over the threshold (€35,000 in most cases). (Be aware that the EU are introducing a one stop shop, expected to take affect from 1 July 2021, which will mean that you can register in one EU state and sell into another).

Find out more at gov.uk/prepare-to-export-from-great-britain-from-january-2021.

Encourage employees to apply to the EU Settlement Scheme.

You will continue to be obliged to check that employees have the right to work in the UK.