3 December - Ask ICAS: Brexit: Customs transition and VAT
With four weeks until the end of the Brexit transition period this webinar looks at customs transition focusing on:
- What is changing
- When customs declarations must be made and options available
- Postponed VAT accounting
- What help and guidance is available
For more information on customs intermediaries and a list of agents:
Guidance on customs training and the customs grants (don’t forget £1,000 grants available to business even if they are not completing declarations themselves):
The UK Global Tariff has been published:
https://www.gov.uk/guidance/uk-tariffs-from-1-january-2021
Customs procedure codes:
https://www.gov.uk/government/publications/uk-trade-tariff-customs-procedure-codes
Businesses can find out more about special procedures that allow you to store, temporarily use, process or repair goods to get full or partial relief from import duties. Includes Customs Warehousing:
If you trade with Northern Ireland there is still time to sign up to the Trader Support Service https://www.gov.uk/guidance/trader-support-service and the automatic registration of a NI XI prefixed EORI https://www.gov.uk/eori will be happening until mid-December and signing up to the TSS does not obligate businesses to use the service (the portal contains free to access guidance and support)
How does Northern Ireland trade change after the transition period?
Great Britain to Northern Ireland -Goods will be subject to new declarations requirements, and may be subject to duties if considered ‘at risk’ of moving to the EU (including Ireland)
Northern Ireland to Great Britain -Moving goods should take place as it does now, with no additional process, paperwork, or restrictions – except in extremely limited circumstances to take account of international obligations or duty suspension1
Northern Ireland to and from Ireland -Trade in goods will continue unaffected, with no change at the border, new paperwork, tariffs, or regulatory checks
Northern Ireland to and from the Rest of the World - Trading will continue broadly as it does today. Northern Ireland will benefit from future UK Free Trade Agreements, and the UK tariff regime2 will apply to imports – unless goods are considered ‘at risk’ of moving to the EU
Transit routes Goods will be subject to specified processes. Transit can be used to move goods from GB to Northern Ireland via Ireland. Transit declarations would apply, and some traders would need to use sealed trucks
Postponed VAT Accounting https://www.gov.uk/guidance/check-when-you-can-account-for-import-vat-on-your-vat-return
From 1 Jan 2021, UK VAT registered businesses that currently import goods from anywhere in the world will be able to use PVA. This means that in most cases these businesses will be able to simultaneously declare and recover import VAT on their VAT returns (as they do now in respect of imports of goods, known as ‘acquisitions’, from EU countries), rather than paying import VAT at or soon after the time that the goods arrive at the UK border.
Businesses don’t need to register for PVA they simply make the appropriate entry and provide their VAT registration number on the customs declaration
- On their VAT return there are no changes to the names of the boxes, but there are changes to the way you complete the boxes on your VAT return if you use postponed VAT accounting
Box 1 Include the VAT due in this period on imports accounted for through postponed VAT accounting.
Box 4 Include the VAT reclaimed in this period on imports accounted for through postponed VAT accounting.
Box 7 Include the total value of all imports of goods included on your online monthly statement, excluding any VAT.
An online monthly statement will be available to download and keep for your records. It will show the total import VAT postponed for the previous month to include in your VAT Return. This will be the VAT return which covers the date when the goods are imported.
However, if you have deferred the supplementary customs declaration, you may not have the monthly statement when you complete your VAT return. If so, you must estimate the figures for in boxes 1 and 4 - using your records of the imported goods
After you have submitted the deferred supplementary declaration, your next monthly statement will show the correct amount of import VAT due on that declaration. You can then adjust any estimates and account for any difference on the next VAT Return.