Brexit May Mean VAT Upfront

by | Jan 9, 2018

Tens of thousands of UK businesses could be forced to pay VAT upfront post Brexit, on goods imported from Europe, in controversial new legislation being considered by MP’s on Monday.

The chair of the Treasury select committee has urged MP’s to investigate the matter further before the customs bill gets its second reading in the House of Commons next week.

Under existing rules, goods imported from the EU are referred to as “acquisitions” for tax purposes, so no VAT is paid until the products have been sold to the final customer and paid for.

If passed, the new legislation could mean that goods from the EU will have to be treated like all other imports after Brexit, and may attract VAT at the time of import.

Customs Insights Managing Director – Terry Clear – commented “As we get nearer to exiting the EU, the complexities of our future trading arrangements become more and more apparent. It is critical that MP’s making these decisions fully understand the finer details.” 

“Upfront payment of import VAT will clearly create additional cashflow pressure for some companies. From an operational standpoint, the processing time at ports and border entry points will increase and more responsibility to collect state funds will fall back on logistics providers.”

“Of course we will await the outcome of next week’s debate, and as one of the UK’s leading customs specialists we will pursue HMRC for clarification.”

Customs Insights Consultancy has been offering customs related services for over 15 years, for further information please email or call 01304 211652.

Follow Us:

Consultancy Services

Ensure compliance, resolve difficulties, manage efficiencies and reduce duty.

CFSP Bureau Services

Customs Freight Simplified Procedures, a simplified electronic paperless gateway.

Specialist Customs Regimes

Compliance and assistance for the many specialist Customs regimes.

Consultancy Services

Ensure compliance, resolve difficulties, manage efficiencies and reduce duty.

More News…..

Test Plans For No Deal Brexit

The Department for Transport held a recent exercise to test plans for border disruption in the event of a no-deal Brexit, however it has been described as "too little too late" by hauliers.The disused Manston Airport in Kent was used as the location for the exercise,...

Managing A No Deal Brexit

UK members of parliament will be voting on the government's Brexit plan for a deal with the EU next week, and it is widely predicted that they will vote against Theresa May.A 'no' majority will surely move us further towards the chance of a 'no deal' or 'hard' Brexit,...

Share This
%d bloggers like this: