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Markel Tax

30 Aug 2018

No VAT payable on imports at the border

The government has announced through guidance issued on 23 August 2018 that if there is a no deal Brexit, businesses importing goods from the EU or from outside the EU will not have to pay import VAT as soon as the goods arrive in the UK.

Postponed accounting will be used, enabling importers to account for the VAT later on their VAT returns.

This will be a relief for importers and a positive result for current importers of goods from outside the EU who will see cash flow improve as a result.

HMRC guidance states that it will be possible to defer the VAT but customs declarations and the payment of any other duties will still be required for imports from the EU in the same way as currently applies when importing goods from outside the EU. An import declaration will be required and any customs duties must be paid. Customs checks may also be performed at the place of importation.

In addition, Low Value Consignment Relief (LVCR) will not be extended to goods entering the UK as parcels from the EU. This means that all goods entering the UK as parcels sent by overseas businesses will be liable for VAT unless they are zero-rated or exempt from VAT. For parcels valued at £135 or less, a technology-based solution will collect VAT from the overseas business selling the goods into the UK.

To discuss the issues call 0345 223 2727.
Tagged Value added tax (VAT) services
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