Charging VAT on EU imports and exports after Brexit

Importing and exporting to EU countries isn’t as simple as it used to be, for obvious reasons. Even HMRC hasn’t always seemed sure of the new rules, especially when you throw Northern Ireland into the mix.

VAT continues to be charged on most goods and services within the UK and on the continent, while importers continue to pay the VAT when they bring goods into the UK.

When we were part of the EU’s customs union, goods could move freely between the UK and other member states without import taxes being charged.

That all went out of the window on 1 January 2021, the point at which more complex VAT changes came into force for both businesses and consumers on both sides of the English Channel.
For businesses this side of the Channel, let’s have a look at how the VAT changes have affected importers of goods from the EU to the UK and exporters of goods going the other way.

Importing goods from the EU

The UK’s VAT-registered firms have to use postponed accounting to account for import VAT on their VAT returns, instead of paying import VAT when the goods arrive on our shores.

These importing businesses do, however, have to contend with customs declarations and stump up the money for customs and excise duties which apply on certain goods or products.

VAT on imported goods worth up to £135 is collected at the point of sale, rather than the point of importation, meaning that UK supply VAT, not import VAT, is due.

Exporting goods to the EU

VAT-registered exporters can continue to zero-rate sales of goods to EU businesses, meaning import VAT and any customs duties are due on arrival at their destination.

UK exporters must have a UK EORI number to export goods to the EU, and they should know the EU EORI number for the European business they are exporting goods to.

Depending on the type of goods being exported, an exporter business might need to apply for an export licence before sending the goods to the EU. They also need to use the correct commodity codes.

Help from Carston for UK traders

Accountants all over the UK have an increasing role to play in helping the UK’s traders pick up the pieces from the UK’s departure from the EU, and we’re one of those.

If your import or export business is struggling to get to grips with the extra responsibilities involved with trading in 2021, get in touch with us today on 029 2023 3223 or via email at