What you need to know for importing and exporting goods after the EU exit transition ends

What you need to know for importing and exporting goods after the EU exit transition ends
Dan Martin
Dan MartinFreelance content creator & event hostDan Martin Content & Events

Posted: Wed 5th Aug 2020

The government has published a document outlining how Britain's border with the EU will work after the end of the transition period for Britain's exit. There will a phased approach as to when businesses will need to comply with new rules.

The document includes steps that all traders need to consider before they move goods. It says: "The UK's negotiations with the European Union will have no impact on the need to take these actions" and it "is not seeking anything in negotiations with the EU that will change the necessity of the...requirements.

When some of the actions need to be taken will depend on whether traders are deferring their customs declarations during the first stage which runs from January to July 2021. More details on the requirements for each stage are set out in the relevant parts of the document.

Here are the steps that trading businesses need to consider:

Apply for a GB EORI number

This is required for all businesses moving goods into or out of GB, including those deferring their import declarations. Further information, including a link to apply for an EORI number, is available here. It can take up to a week to get one, and around 5-10 minutes to apply.

VAT registered businesses with EU trade were previously enrolled with an EORI number, so should check whether they already have a number before applying.

Get a customs intermediary

The document says: "Customs declarations are complicated" and advises the following:

The majority of businesses that currently trade outside the EU use an intermediary, such as customs agents, fast parcel operators (FPOs), freight forwarders (FFs) or brokers, to help them meet requirements. Intermediaries can help traders find the information needed to complete formalities and submit the required declarations. This simplifies the declaration processes for traders. Further information can be found here. The UK government has announced a grant scheme to support intermediaries and those businesses who want to make declarations themselves.

If a business decides not to use an intermediary, they will need to make declarations themselves. To do this they will need to get access to HMRC systems and to purchase software.

Apply for a Duty Deferment Account

Traders who import goods regularly may benefit from having a duty deferment account (DDA). This enables customs charges including customs duty, excise duty, and import VAT to be paid once a month through Direct Debit instead of being paid on individual consignments. VAT registered traders can instead account for import VAT on their VAT return using postponed VAT accounting.

To set up a DDA, traders, or their representatives, apply for a deferment account number (DAN) and will need to be authorised by HMRC. New rules are being introduced which will allow most traders to use duty deferment without a Customs Comprehensive Guarantee (CCG).

Prepare to pay or account for VAT on imported goods

VAT registered traders will be able to account for import VAT on their VAT return by using postponed VAT accounting from 1 January 2021. Unless they are eligible to defer their supplementary declarations, they will not be compelled to use postponed VAT accounting. Non-VAT registered traders (and any VAT registered traders not using postponed VAT accounting) will need to report and pay import VAT through the customs processes.

Within this context, VAT payments can be deferred using a DDA as outlined above. VAT on imports of goods in consignments not exceeding £135 in value will be treated differently to those goods in consignments exceeding £135.

Ensure drivers have correct international driving permits

Hauliers need to ensure their drivers have the correct documentation, for example an international driving permit (IDP) or an additional licence may be required to drive in some countries. More information will be provided on the GOV.UK government website as the requirements are clarified.

Additional actions for customs, VAT, and excise processes

  • Find the right commodity code for your goods.

  • Businesses importing goods into GB should ensure they are familiar with using the 'Trade with the UK' tool which provides detailed information on tariffs, taxes and rules. The tariffs shown are those currently being applied until 1 January 2021. Use the UK Global Tariff tool to check the tariffs that will apply to goods imported from 1 January 2021.

  • Exporters of goods from GB should ensure they are familiar with using the 'Check How to Export Goods' tool which provides detailed information on duties and customs procedures for over 160 countries.

  • Traders should engage with supply chains to discuss how to work together going forward and the information required by different entities to complete customs procedures.

  • Excise traders wishing to use excise duty suspension must also apply as a registered consignor or seek the services of someone who is already approved. Only registered consignors are permitted to move excise goods in excise duty suspension and use the Excise Movement and Control System (EMCS) at import.

  • Businesses exporting excise goods must also use the EMCS. Excise duty liability will be discharged when confirmation is received that the goods have exited GB (this is via the customs export declaration).

Consider Commercial Arrangements

Individual commercial contracts and arrangements may alter the default legal responsibilities and requirements. Contractual obligations for international commercial transactions are outlined in the Incoterms rules, which are administered by the International Chamber of Commerce. These are an important consideration for traders when moving goods internationally, and should be considered and understood alongside the information in the full document.

Dan Martin
Dan MartinFreelance content creator & event hostDan Martin Content & Events
I'm a freelance content creator and event host who helps small businesses and the organisations that support them. I have 18 years of experience as a small business journalist having interviewed hundreds of entrepreneurs from billionaires like Sir Richard Branson to the founders behind brand new start-ups. I've worked for a range of leading small business publications and support groups, most recently as head of content at Enterprise Nation where I was responsible for the prolific output of content on the company's blog and social media. I'm based in Bristol where I run and host regular events with the local small business community and have strong connections to major business organisations in the south west region. In total, I've hosted over 50 events; from intimate meet-ups to conferences with an audience of hundreds including events for international brands like Facebook and Xero. I'm also a big fan of podcasts having hosted Enterprise Nation's Small Business Sessions as well as lots of online events including Facebook Live interviews, webinars and three live web chats from inside 10 Downing Street. With my partner, I co-run Lifestyle District, a lifestyle blog focused on culture, art, theatre and photography. I'm here to help. I'm volunteering free advice calls of up to an hour as part of the Recovery Advice for Business scheme, over the next 6 months. Please get in touch to see how I can help your business. 

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