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All posts tagged Brexit

HMRC update partnership pack: preparing for a ‘no deal’ EU exit

BREXIT – British withdrawal from the European Union. Following a referendum held on 23 June 2016, in which a majority of votes cast were in favour of leaving the EU, the UK government intends to invoke Article 50 of the Treaty on European Union by the end of March 2017. This, within the treaty terms, would put the UK on a course to leave the EU by March 2019.

HMRC have updated their partnership pack on G‌O‌V.U‌K to help businesses plan for the possibility of a ‘no deal’ EU Exit.

The third edition of the pack is available to view here:

This pack includes information from, and directs people to, 5 online guides, which provide the information on the steps UK businesses trading with EU need to take now in order to plan for a no deal scenario:

  • Guide 1 – Get a UK EORI number to trade within the EU
  • Guide 2 – Exporting and importing goods if the UK leaves the EU with no deal
  • Guide 3 –  Declaring your goods at customs if the UK leaves the EU with no deal
  • Guide 4 – Customs procedures if the UK leaves the EU with no deal
  • Guide 5 – Moving goods to and from the EU through roll on roll off locations including Eurotunnel.

Included within the partnership pack there is a section providing an update on how VAT for businesses would be affected.  Some of the key points provided in the pack are:

  • The UK will continue to have a VAT system after it leaves the EU. The revenue that VAT provides is vital for funding public services and the VAT rules relating to UK domestic transactions will continue to apply to businesses as they do now.
  • If the UK leaves the EU on 29 March 2019 without a deal, the government’s aim will be to keep VAT procedures as close as possible to what they are now. However, there will be some specific changes to the VAT rules and procedures that apply to transactions between the UK and EU countries.
  • In the VAT for businesses technical notice, the government has announced that in a ‘no deal’ scenario it will introduce postponed accounting for import VAT on goods brought into the UK. This means that UK VAT registered businesses importing goods to the UK will be able to account for import VAT on their VAT return, rather than paying import VAT on or soon after the time that the goods arrive at the UK border. This will apply both to imports from the EU and non-EU countries.
  • If the UK leaves the EU without an agreement, VAT will be payable on goods entering the UK as parcels sent by overseas businesses. The government set out in the Customs Bill White Paper (published October 2017) that Low Value Consignment Relief (LVCR) will not be extended to goods entering the UK from the EU. This note confirms that if the UK leaves the EU without an agreement then LVCR will no longer apply to any parcels arriving in the UK. This aligns the UK with the global direction of travel on LVCR. This means that all goods entering the UK as parcels sent by overseas businesses will be liable for VAT (unless they are already relieved from VAT under domestic rules, for example zero-rated children’s clothing). For parcels valued up to and including £135, a technology-based solution will allow VAT to be collected from the overseas business selling the goods into the UK.
  • If the UK leaves the EU without an agreement, the UK will stop being part of EU-wide VAT IT systems such as the VAT Mini One Stop Shop. Details for specific EU-wide VAT IT systems is set out in the VAT for business technical notice.

For further details please click here.

This Article was taken from the website, for the original article please follow this link :

HMRC prepares for possible No-Deal Brexit


HMRC recently published an updated version of their Partnership Pack on GOV.UK. This pack is designed to help businesses for the possibility of a ‘no-deal’ EU exit. This builds on the previous version of the pack, published in October, and includes additional information about trade at the border from departments across government.

The pack is for organisations, intermediaries and infrastructure providers to use for their own contingency planning and to share with those they represent, their clients and members. It is designed so that you can take information from it and tailor it to suit your own channels and your audiences’ needs.

The pack focuses on how VAT, Customs and Excise could be affected and includes information split by topic and audience,and also includes flowcharts.

Future editions of this pack will include additional information around policies that will impact trade at the border and we will update you when these are published.

Implications of a no-deal Brexit

David Miller looks at the practical implications of Brexit on international trade for small businesses.

The government’s recent release detailing its plans for businesses trading with the European Union in the “unlikely” event of a no-deal Brexit brings with it further uncertainty for those small businesses that are part of an international supply chain. Despite the fact that the report attempts to provide assurances that negotiations are progressing well, businesses of all sizes continue to question what the future holds for their trading operations once Brexit is finalised on 29 March 2019.

While the government report certainly makes for interesting reading, the real takeaway is that any business involved in international trade — and particularly with EU countries — should consider the impact that Brexit is set to have on their operations, and start to make plans accordingly.
Detailed guidance

The government’s guidance papers say that in the event of a no-deal Brexit, businesses will have to lodge customs declarations and potentially pay customs duty on goods imported from EU countries. The guidance also says that companies “may wish to consider taking professional advice”, but there are a number of key omissions from the guidance that allow small businesses to carry out some risk mitigation.
Missing AEO

One factor the government has failed to mention is that the concept of Authorised Economic Operator (AEO) status is a way that importers and exporters can ensure they are in the best position ahead of Brexit. AEO status can help speed up customs processes, standing firms in good stead, whatever the outcome of the Brexit negotiations. Even if the UK does negotiate a deal, AEO accreditation may be advantageous in addressing existing Brexit concerns.

Why the government failed to mention AEO in the guidance papers remains a mystery. One can only imagine that it comes down to a lack of resources to process a huge number of applications that could follow such widespread advice. Businesses should seriously consider this option in order to be in the best possible position next year.
AEO explained

AEO is an integral part of the Union Customs Code legislation, which will be replicated in UK law as a result of Brexit. It is an internationally recognised quality kite mark indicating that a business’s role in the international supply chain is secure, and that customs controls and procedures are efficient and compliant.

In simple terms, AEO status means that items can pass through customs as quickly as possible, avoiding delays in the supply chain being a key risk mitigation factor for companies.

AEO status also means:

● It is quicker and easier to obtain customs simplifications

● The business is subjected to fewer physical and document checks at borders

● If the truck is selected at controls, it will be given priority as an AEO consignment

● The business can request that a control is held at a different place

Some key benefits of AEO status include:

● More efficient transferring through borders

● Less risk and more effective checks on the reliability of third parties

● Potentially lower insurance premiums in the future

● More efficient import/export systems

If a Brexit conclusion is not reached, businesses importing goods from the EU will be required to follow customs procedures in the same way that they currently do when importing or exporting from and to countries outside the EU. This means that for goods entering the UK from the EU, an import declaration will be required, customs checks might be carried out and any customs duties must be paid.

The government release states that before importing goods from the EU, a business will need to:

● Register for a UK Economic Operator Registration and Identification Number

● Ensure their contracts, and international terms and conditions of service reflect that they are now an importer

● Consider how they will support declarations, including whether to engage a customs broker, freight forwarder or logistics provider. Engaging a customs broker or acquiring the appropriate software and authorisations from HMRC will come at a cost

● Decide the correct classification and value of their goods and enter this on the customs declaration
Limited warehousing capacity

Customs warehousing has been presented as a means of safeguarding operations in the event of a no-deal Brexit. However, if everyone rushes to carry out this approach, demand will likely skyrocket and could lead to delays.

At present, I understand that there are more than 800 customs warehouses authorised within the UK, and even before considering Brexit, 750 of these will need to be re-authorised by the end of April 2019. This means that there could easily be a huge rush on the authorities to action these requests in time, particularly if demand for such warehouses rises at the time of Brexit.


All things considered, it is essential for businesses working across all industries to consider the impact of their imports and exports in the event of a no-deal Brexit. Also, with suggestions from some cabinet ministers, including Liam Fox, that a no deal was the “most likely outcome” for Britain, it is highly likely that firms will need some safeguards in place, whatever the eventuality


This artcile was written by David Miller of The Customs People for for the original of this article please follow this link : Implications of a no-deal Brexit