HMRC sends letter outlining the impact of a no deal Brexit on VAT.

You will have noticed that HMRC continues to urge VAT-registered UK businesses which trade exclusively with the EU to be prepared for a no deal Brexit.

It has sent a letter to 145,000 VAT-registered affected businesses, explaining changes to customs, excise and VAT procedures in the ‘unlikely event’ that the UK leaves the EU without a Brexit deal.

HMRC’s letter contains the following three actions ahead of ‘Brexit Day’ on 29 March 2019:

  • register for a UK Economic Operator Registration and Identification (EORI) number
  • decide whether a customs agent will be used to make import and/or export declarations, or whether declarations will be made by the business via software
  • contact the organisation responsible for moving goods (for example, the haulage firm) in order to ascertain whether the business will need to supply additional information to complete safety and security declarations, or whether it will need to submit these declarations itself.

It is important to note that the letter went to VAT registered businesses. There will be some smaller businesses below the threshold that will not have received the letter but will need to take action.

The guidance Get a UK EORI number to trade within the EU states that it ‘could take three days to get a UK issued EORI number, so you should apply now’. It is also highlighted that ‘It can take longer than three days if there are high volumes’: clearly the ‘apply now’ is the key message for businesses. The application is short, simple and quick for businesses.

The original guidance has also been updated during February. These updates:

  • clarify that Northern Ireland businesses should also apply for an Economic Operator Registration and Identification (EORI) number unless they only trade across the Northern Ireland–Ireland land border
  • clarify that you do not need an Economic Operator Registration and Identification (EORI) number if you’ll only import or export services that do not involve moving physical goods.

Article from ACCA In Practice