HMRC have updated VAT Notice 700/1 to provide temporary rules which allow some EU businesses to apply for a UK VAT registration in advance of a no-deal Brexit.
Some EU businesses who trade with UK customers may not currently require a UK VAT registration. In the case of using existing cross-border VAT simplifications such as:
- Call-off stock arrangements; or
- Rely on the recipient to account for the VAT on supplies (i.e. acquisition tax).
No-Deal Brexit and VAT
However, should a no-deal Brexit occur, some of these simplifications will no longer apply. Therefore, EU businesses may require a UK VAT registration to be compliant and make supplies to UK customers.
Accordingly, HMRC have amended their guidance at paragraph 4.7 of VAT Notice 700/1 (which can be found here) to allow EU businesses affected to apply for a UK VAT registration in advance of a no-deal Brexit. Once accepted, the EU business will receive notification that their VAT registration will go live as of 1 November 2019. In the event of a deal, registrations will be amended or cancelled.
Furthermore, it will also be important to apply for a UK Economic Operator Registration and Identification (EORI) number. This will ensure your goods can be imported into the UK. This is because the goods will no longer be an intra-EU movement of goods but will become an import into the UK. To ensure the goods clear customs procedures, your business needs a UK EORI number.
The reason behind these temporary arrangements is to ensure there is minimal disruption for UK businesses who have EU suppliers. The UK VAT registration and EORI number will allow the EU business to continue to supply its UK customers without as from 1 November 2019 without causing any delays.
If you are:
- An EU business that supplies UK customers and;
- Have not taken any action in regards to a no-deal Brexit
Please contact one of our VAT experts who can assist in getting you Brexit ready.