UK Exporters

VAT ON EXPORTS TO THE EU

Following Brexit, and the UK’s withdrawal from the EU Single Market, exports to customers located in the EU is zero rated provided that the appropriate evidence to support the removal of the goods from the UK is maintained.   

For exports to VAT registered businesses in the EU, the Incoterms will determine whether you have any VAT obligations in the EU, and in most cases, we would recommend that Delivered Duty Paid (DDP) Incoterms are avoided.  For exports to private individuals, registration under the EU’s Import One Stop Shop (IOSS) or Union One Stop Shop (OSS) may be necessary. We’ll advise you on the VAT record-keeping requirements and registration obligations arising from your trade with the EU. 

Although the EU/UK Trade and Cooperation Agreement removed any tariffs for goods of UK origin being imported into the EU; where goods have been sourced from other jurisdictions, you or your customer may also need to pay import duty before the EU customs authorities will release the goods. 

VAT ON EXPORTS TO THE REST OF THE WORLD

There is no VAT chargeable on your exports to customers outside the EU, so you can zero-rate your invoices as long as you keep proof that your goods or services have been exported. 

If your exports pass through an EU country whilst en route to a non-EU customer, they remain zero-rated for VAT. In this case your records must show the final, non-EU destination country. You or your customer may also need to pay import duty before the local customers authorities will release the goods. 

VAT AND GST

You are probably familiar with VAT, but what is GST? Goods and Services Tax (GST) is another value-added tax that’s essentially very similar to VAT and is applicable or exempt depending on the items concerned. GST rates are generally lower than VAT but vary from country to country. GST is used in around 160 countries worldwide, with some of the most notable being Australia, Brazil, Canada, India, South Korea, Spain and Vietnam. 

We can advise you on both VAT and GST, including whether you need to register, dealing with representatives, withholding payments and to VAT refunds. With VAT and GST being applied increasingly worldwide, it’s more critical than ever to understand and minimise the indirect tax consequences of international trade for your business.  

CUSTOMS DUTY OBLIGATIONS

Customs duty is a tax that is largely overlooked by businesses and yet it directly impacts their profitability.  As a result, Customs Duty is like any cost within the supply chain that should be analysed and monitored.   

We can assist with support around ensuring the correct tariff classification is shown and that the appropriate origin status and preferential duty rates are applied.  In addition, where appropriate, we can advise on the availability of customs duty reliefs.