UK VAT and Customs Duty – Trading with the EU from 1st January 2021
The UK’s relationship with the EU will change fundamentally once the formal Transition Period ends on 31st December 2020. Politically it seems unlikely that the Transition Period will be extended and it remains to be seen if last-minute talks can result in a Free Trade Deal, which is the stated aim of both parties, by that date.
Even if a Free Trade Deal is achieved, the UK is leaving the EU VAT area on 31st December 2020. It remains to be seen if it will leave the EU Customs Union/common tariff area. It is therefore vital that all businesses trading with the EU (particularly in goods) are prepared for the major changes to import and export procedures for VAT and Customs Duties (“tariffs”).
This article aims to give an overview of the main changes but the proposals are complicated in nature and we would recommend specific advice is taken in all cases.
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