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EU Exit - Frequently Asked Questions

13th January 2021, 14:01
Eu exit
EU Exit - Frequently Asked Questions

You have a lot of questions. So do we. There are no fewer than fifteen parts of the UK-EU deal which are yet are to be finalised, and others which have a grace period attached. So, even though we've been waiting a long time, there is still a little longer to wait.

But there is a lot that we now do know, so we've gathered the most in-demand FAQs from reputable sources to populate this list, and we'll keep it updated as more information comes to light. If there's a question you'd like us to find the answer to, or you simply want some support around EU Exit, please get in touch:

I don’t trade with Europe, so it won’t affect me, will it?

Even if you don’t trade with suppliers or customers in the EU, you may experience the knock-on effects of any new rules for living, working, travelling and doing business in the UK and EU that affect your suppliers and customers. Your employees are also likely to be affected if they are from the EU.

Checks will be needed on goods crossing the Irish Sea between Northern Ireland and Great Britain, which businesses will need to be prepared for.

You may want to review your supply chain and your customer base, identify any risks and take steps, wherever possible, to mitigate them. You might want to make more use of domestic suppliers, for example.

Whatever your current trade arrangements, review your business strategy in light of EU Exit and consider any opportunities there may be in terms of international trade beyond Europe.

You may also want to reassure your EU workers that they are welcome and that they will be able to apply for ‘settled status’ under the EU Settlement Scheme.

Insight taken from from Lloyds Bank.

What is the new UK Global Tariff and what will it mean for my business?

In May 2020, the Government announced a new UK Global Tariff (UKGT) which will replace the EU’s Common External Tariff from 1 January 2021.

It is described as a ‘simpler, easier to use and lower tariff regime’ and is aimed at scrapping red tape and reducing cost pressures, to help UK businesses compete in terms of global trade. It will be in pounds rather than euros.

Key features of the UKGT include;

  • Removing the Meursing table, which is currently used to determine which tariff code, and therefore how much duty, is applicable to goods when importing them. This will allow the UK to scrap tariff variations on various products including biscuits, pizzas and confectionary.
  • Eliminating tariffs on a wide range of products, including products such as copper alloy tubes and screws and bolts which are used in UK production, cutting costs to businesses and consumers.
  • Maintaining tariffs on a number of products backing key UK industries, including agriculture, automotive and fishing, in a bid to support UK businesses.

Insight taken from from Lloyds Bank.

What is our status of trade with the rest of the world?

In addition to negotiation of the TCA, the UK has negotiated trade agreements covering 60 countries which substantially reproduce the terms of the trading agreements that applied while the UK was in the European Union. These roll over agreements came into effect on 1 January 2021 (in some cases under provisional or bridging arrangements).

The UK is free to negotiate further trade deals with countries outside of the EU. To this end, the UK is in ongoing negotiations with six countries, and has signed agreements with Canada, Jordan, and Mexico which are expected to take effect in early 2021. The UK has also signed mutual recognition agreements with Australia, New Zealand, and the United States of America, meaning that there is reciprocal recognition of each party’s product conformity assessments.

Insight taken from Burges Salmon.

What is a UK Economic Operator Registration and Identification number and will I have to register for one?

An Economic Operator Registration and Identification, or EORI, number is a unique ID code required by businesses that trade goods with countries outside the EU.

In the UK, an EORI number is allocated to an importer or exporter by HMRC. It provides information to customs authorities as part of EU security measures on shipments.

From 1 January 2021 you’ll need an EORI number starting with GB to trade outside of the UK including with EU countries. This does not apply if you are trading between Northern Ireland and the Republic of Ireland. If you already have an EORI number you’ll be able to continue using it. If you move goods to or from Northern Ireland you’ll also need an EORI number that starts with XI , in addition to your GB number.

You won’t need an EORI number if you only provide services.

Insight taken from from Lloyds Bank.

Do I need to undergo new protocols for trading with Northern Ireland?

I am an EU business that wants to import or export goods directly from/to Northern Ireland (NI) to/from an EU Member State after 1 January 2021. Are there new procedures I need to undergo?

No. From 1 January 2021, the Protocol on Ireland and Northern Ireland applies and EU rules for customs, VAT and excise duties continue to apply to all goods entering and leaving Northern Ireland from/to the EU.

This means that the rules that apply to the movement of goods between two EU Member States will also apply to goods moving between Northern Ireland and an EU Member State, and vice versa.

EU goods brought from an EU Member State to Northern Ireland, or vice versa, will be treated as an intra-Union transaction. There will be no customs formalities. EU VAT rules will also continue to apply for transactions in goods.

These operations should be declared in the VIES (VAT Information Exchange System) listing.

Insight taken from the European Commission.

Will my business still have to meet EU safety standards for goods?

To be sold on the EU market, many products have to meet safety standards set out in EU regulations. The CE mark is used on certain goods to show that they meet these standards.

CE marking will continue to be required for products being sold in the EU.

From January 2021, products sold in Great Britain will need to feature the new UKCA marking.

The technical requirements products must meet – and the conformity assessment processes and standards that can be used to demonstrate conformity – will be largely the same as they are now.

Insight taken from from Lloyds Bank.

What rules and duties apply to importing excisable goods from the EU to the UK?

From 1 January 2021, it will no longer be possible to export excise goods to the UK just using the EMCS system. The EU’s accompanying documents - Simplified Accompanying Document (SAD) and Electronic Accompanying Documents (EAD) – will no longer be accepted in Great Britain. For the rules for the entry of excise goods in Great Britain, see the UK government’s website.

Transactions of excise goods between Northern Ireland and Great Britain will also be subject to EU rules for the import or export of excise goods. Northern Irish traders should use the EMCS and follow EU procedures when moving excise goods to/from EU Member States.

Insight taken from the European Commission.

Customs processes are complicated. Who can help me complete them?

Most traders find that they need specialist support to help with importing from or exporting to the EU. For instance, you might decide to use a customs intermediary. A customs intermediary is someone who makes customs declarations for you or your business. This could be:

  • a freight forwarder – a company that helps their clients move cargo globally, including supporting the customs process
  • a customs agent or broker – these make sure your goods clear through customs.

If you decide to use an intermediary, make sure you approach them as soon as possible, as there is high demand for these services. You can find a list of businesses that can help on GOV‌.UK.

There are still specific actions you will need to take if you get an intermediary to help you with your customs declarations. You will:

  • be responsible for paying any taxes or duties owed
  • be responsible for providing details about your transactions to your chosen intermediary
  • need to apply for an Economic Operator Registration and Identification (EORI) number (if you don’t already have one). An intermediary can’t apply for an EORI on your behalf and they will need this to complete your customs declarations. You can register for free on GOV‌.UK. It takes 5 to 10 minutes to apply and you will normally receive it in under a week.

Insight taken from HMRC.

My business is located in the United Kingdom and I export goods to EU customers, can you explain how I should account for VAT?

If you sell, send or transfer goods out of the UK you do not normally need to charge VAT on them in the UK. You can zero-rate most exports from:

  • Great Britain to a destination outside the UK
  • Northern Ireland to a destination outside the UK and EU.

If you incorrectly charge UK VAT on exports of goods, your customers may also have to pay VAT in the country where the goods are imported.

Different rules may apply in different countries. Therefore, it’s important that you understand the import VAT rules of each EU country that you sell to.

You can find out more about exports, sending goods abroad and charging VAT on GOV‌.UK.

Insight taken from HMRC.

I send goods from the United Kingdom to my customers in the EU, has anything changed about how I should account for VAT?

Yes. Previously, before the end of the transition period:

  • VAT was due on the goods that you sold to your EU customers. If your EU customer was not VAT registered themselves (for example, because they were a private individual) you accounted for UK VAT in the UK. If your sales to EU customers breached an annual distance selling threshold you had to register for VAT in that EU Member State and account for EU VAT in that country.
  • If your EU customer was registered for VAT in their own country your business zero-rated the sale as a 'dispatch' and your EU customer accounted for the VAT as an 'acquisition' in their own country.

Now, following the end of the transition period:

  • if you are a business subject to the Northern Ireland protocol the above rules will still apply
  • if you are a business moving goods from Great Britain to the EU, your goods should be zero-rated exports from the UK and import VAT will be due to be collected from the EU recipient at import into the EU and subject to EU rules
  • different rules may apply in different countries – therefore, it’s important that you understand the import VAT rules of each EU country that you sell to
  • you can find more information and guidance about the conditions for zero-rating VAT on the goods you export, and what you should do when you export goods in specific circumstances on GOV.UK.

Insight taken from HMRC.


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