Businesses that buy goods from the EU or export goods to the EU would be advised to read the recent guidance from HMRC that is published under the title, “VAT for businesses if there is no Brexit deal”.
The purpose of this notice is, in the event that the UK leaves the EU on 29 March 2019 with no agreement, to inform UK businesses of the implications for VAT rules for goods and services traded between the UK and EU member states. It outlines the impacts and gives information for businesses to take into consideration.
While the UK government is confident that it will agree a good deal for both sides, as a responsible government it will continue to prepare for all scenarios, including the unlikely outcome that the UK leaves the EU without a deal.
This is a contingency planning strategy for a scenario that the UK government does not expect to happen, but that people should be reassured that the government is taking a responsible approach.
It is important that businesses consider how a ‘no deal’ scenario could affect them and begin to take steps to mitigate against such a risk, however unlikely. This technical notice provides further details to support early planning on VAT to help businesses understand the potential impacts, with the government providing further details, including specific actions that businesses should take, in due course.
For most UK businesses there will be no change to VAT rules. UK businesses that are affected may wish to consult other relevant technical notices, including the Trading with the EU if there’s no Brexit deal notice, which covers customs, excise and import processes at the border.
If your business buys and/or sells goods to the EU, you may want to start your contingency planning now, and, of course, VAT is just one of the issues you may need to consider.
The full document can be read online at:
https://www.gov.uk/government/publications/vat-for-businesses-if-theres-no-brexit-deal/vat-for-businesses-if-theres-no-brexit-deal
For further information on this please contact Priya Raja-Motala at PriyaR@myersclark.co.uk or on 01923 224411.