VAT Director Rayner Essex
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Brexit reality 8: Export evidence when zero rating

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Jason Croke summarises the zero rating export rules for businesses that have only ever traded with the EU before Brexit and may not be as well versed with the export paperwork requirements.

12th May 2021
VAT Director Rayner Essex
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The rules for zero rating an export have not changed since Brexit.

HMRC requires zero rated exports to be supported with an array of documents and there is potential for businesses to get caught out, with the risk of penalties and VAT liabilities arising from such oversights.

Export evidence

For example: Marv’s Marvellous Mugs Ltd (MMM Ltd) is based in the UK and manufactures bespoke mugs for corporate customers in the UK and EU only. A new EU based business customer places a large order of mugs and arranges for the goods to be transported using their own freight agent.

The customer has arranged their own freight because they want to control the shipping process, ensuring their freight agent has the right documentation for delivery, etc.

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Replies (2)

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By ollie
12th May 2021 15:11

Very useful article, Jason. One of our longstanding European customers now wishes to purchase products from us on an ex-works basis. How important is it to try and persuade them to provide official evidence (eg the CHIEF screen print with status entry code 8 and ICS code 60) or is commercial evidence on its own likely to be sufficient?

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Replying to ollie:
Jason Croke
By Jason Croke
17th May 2021 08:27

Hi

It comes down to relationships, if it is a regular customer you have a long standing relationship with, then there is no reaso0n why they cannot take the goods ex-works and supply you with the paperwork you need after the event, to support the zero rating.

Thanks (1)