Import/Export: Customs Tariffs, Duties and VAT

As the date for leaving the EU, and arguably leaving without a ‘deal’, gets ever closer, it is important for businesses to understand what implications this has for them from a VAT and Indirect Taxes perspective.

Video: Brexit - how can you prepare your business for a No-Deal Brexit?


Arguably the biggest change for businesses arising from Brexit is that all arrivals and departures of goods to and from the UK will become ‘imports’ and ‘exports’ from a VAT and Customs Duty perspective. Currently, only goods whose origin or destination is outside the EU are considered “imports” or “exports”. The importance of this distinction is that imports attract Import VAT – which is recoverable subject to the usual rules on VAT recovery – and Customs Duty, which is not recoverable. Crucially, as the Duty is not recoverable this will, unfortunately, represent an additional cost of doing the same business.

Customs Duty

As Customs Duty is an absolute cost, it will be very important to assess the type of goods arriving and categorise them correctly - as this will drive the rate of Duty - and also understand how to correctly value imports for Duty purposes and take advantage of any Duty reliefs. Equally important, as hold-ups at borders could be commercially extremely damaging, is exploring any possible deferment options, which allow goods to move freely with the Duty paid retrospectively. Businesses may also wish to assess their supply chains in order to understand whether creating a business presence in the EU may be beneficial in mitigating these increased absolute financial and administrative commitments.


Additionally, businesses will no longer be able to use the UK’s Mini One Stop Shop ("MOSS") portal to report and pay VAT on sales of digital services to consumers in the EU. Instead, businesses that wish to continue to use MOSS accounting will be required to register for the VAT MOSS non-Union scheme in an EU Member State.

Brexit will clearly bring many new challenges to businesses and we are encouraging all of our clients and local businesses to reach out for support which we would be delighted to provide.

Trading with Northern Ireland

HMRC has published guidance on trading with Northern Ireland post 1st January 2021. There will be changes to the way goods move between Great Britain and Northern Ireland. You should act now to get your business ready for these changes. If you are not ready, you may not be able to move goods between Great Britain and Northern Ireland from 1 January 2021. Businesses that trade with Northern Ireland should sign up for the Trader support service.

The trader support service will guide you through the requirements.

For more info: Sign up for the Trader Support Service - GOV.UK

Moving goods into, out of, or through Northern Ireland from 1 January 2021 - GOV.UK

  For the latest government information during the transition period, please visit

Brexit Checklist

  • Audit supply chains, identifying which supplies will be affected
  • Of those supplies affected, determine increased cash flow burden and absolute costs
  • Identify where costs may increase post – Brexit and re-route where feasible
  • Establish European entities/hubs that may be able to procure goods without Duty
  • Apply for Deferment of Import VAT  and Customs Duty
  • Implement ‘best-practice’ cash flow management procedures
  • Identify and take advantage of all available Duty Reliefs, assessing the correct (and lowest) Duty Rates appropriate to relevant goods