Updated: 6 days ago
Border rules have changed and it is now critical that all UK Traders have a strategy for managing the stress-free movement of inventory between the United Kingdom and the European Union. The below highlights some important issues:
1) All goods will now have to go through Customs and be subject to UK Import VAT.
If an item is coming from the EU free circulation then Import VAT will need be paid in the UK in order for it to be free of customs controls. (Note that this is different than tariffs and duty.) This also applies to goods that are in UK free circulation; import VAT will need to be paid in an EU member state in order for the work to be in EU free circulation. Be sure that you know the item’s commodity code before its transport so that you are already aware of the additional charges before it departs from its origin and certainly before it arrives at the border of its destination.
Any such movement will require careful planning and meticulous consideration of the taxation to ensure everything can go as smoothly as possible. Traders should therefore consider Postponed VAT Accounting. Businesses can apply to pay import VAT on your VAT return as opposed to when the items arrive at the border.
2) Factor in inevitable border delays and hidden costs
Shippers are likely to incur increased costs, which will no doubt be passed on to the end user. As customs queues are longer, there will need to be more drivers on each truck in order to comply with regulations regarding worker’s hours. Vehicles will likely need to be further modified in terms of both security and climate control to account for standing idle for longer periods of time. Furthermore, it is possible that insurance companies will increase their costs because more delays means the more time that the goods are not secured in a storage warehouse or with the consignor/consignee.
3) Ensure all paperwork is up to date and complete
As the Importer of Record, you are the business/person responsible for the products that are being brought into the country, but you also need to be sure that all of the paperwork (pro forma invoices, customs declarations, etc.) are all correct as an error could mean that you are fined. In addition, you need to file all relevant paperwork according to Her Majesty’s Revenue and Customs (HMRC)’s guidance and maintain those records for a minimum of six years.
As Customs specialists, Ossad Art Management can help traders prepare and navigate by:
1) Developing Brexit strategies for your business
2) Recommending systems to ensure that records are maintained according to HMRC regulations
3) Logistics planning for upcoming transports
For more information about our services, contact Tova Ossad at firstname.lastname@example.org