HMRC Update: VAT Preparations for Brexit

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With the deadline for leaving the EU set for 31st October 2019, a no-deal Brexit will mean immediate changes to the way UK businesses trade with the EU. Some of these changes may affect your business, or your clients’ businesses. HMRC have issued an update on preparations for VAT after Brexit. BTCSoftware has created this overview guide to help you and your business prepare.

                                  EU and UK Flags

The changes will mean that:

  • UK businesses will have to apply customs, excise and VAT processes to goods sold into the EU (the same rules that already apply to trade outside of the EU)
  • Trading partners in the EU will have to apply customs, excise and VAT processes to trade they carry out with you (in the same way they do for goods and services traded from outside the EU)

Getting an EORI Number

Over 88,000 VAT registered companies have now automatically been issued a UK EORI (Economic Operator Registration and Identification) number, and HMRC have sent letters to these businesses to advise them of their UK EORI number.

You may already have a UK EORI number. If your EORI number begins ‘GB’ then you can continue to use that to trade with the EU after a no-deal Brexit.

Businesses will be unable to move goods in and out of the UK without a UK EORI number. This is important for businesses that aren’t VAT registered, as HMRC can’t issue this automatically.

To apply manually you will need:

  • Your VAT number and effective date of registration (from your VAT registration certificate)
  • Your National Insurance number (for individuals and sole traders)
  • Your Unique Taxpayer Reference (UTR – or ‘tax reference’. If you can’t find yours, you can get more information here)
  • Your business start date and Standard Industrial Classification (SIC) code (found in the Companies House register)
  • Your Government Gateway user ID and password

HMRC advise that you will be given your EORI number straight away unless additional checks are required. In case of additional checks you should allow 5 working days to receive your EORI number. And if you use CHIEF systems, you will have to wait 48 hours to use your EORI number for customs declarations.

Making Tax Digital for VAT

BTCSoftware's MTD for VAT Solution, BTCHub, is an easy-to-use bridging tool that allows submission of Making Tax Digital compliant VAT Returns. To find out more about BTCHub, call the BTCSoftware team on 0345 241 5030 or email us at [email protected]