Changes from 1 January 2021

The UK continues to levy VAT and the rules relating to UK domestic transactions continue to apply to businesses as they did previously. VAT procedures, on the whole, remain as those prior to 31 December 2020, but there have been some changes to the VAT rules and procedures for transactions between the UK and EU member states.


  • Vat is charged on most goods and services sold within the UK and EU
  • VAT is payable by businesses when they bring goods into the UK
  • Goods that are exported by UK businesses to non-EU countries and EU businesses are zero-rated, meaning that UK VAT is not charged at the point of sale.
  • For services, the “place of supply” rules determine the country in which you may need to charge and account for VAT

Importing goods from the EU

  • When goods enter the EU, in principle, an import will take place. This means that customs compliance obligations will arise
  • If import VAT is due you will need to determine the amount of import VAT to be accounted for, the extent to which import vat incurred can be recovered, and whether any (country-specific simplifications, optimizations, or requirements could apply.
  • If the goods are subject to customs duties, then these will also be payable.

The importation of goods into the EU is generally accompanied by an entry summary declaration (ENS), which must be lodged prior to the arrival of the goods. An ENS contains information about the goods typically found in the exporter’s documents, such as bills of lading and commercial invoices. When, following their placement into temporary storage under the customs supervision, the goods are assigned to a customs procedure, a customs declaration must be submitted. You may need to appoint a customs intermediary who will complete and submit the declarations on your behalf.

Exporting goods from the UK to the EU

UK businesses exporting goods to the EU will now need to meet certain customs compliance obligations.

  • The exporter of record must be established in the UK for customs purposes. If the business intending to export does not meet this condition, it is possible for an agent or their party to act as an exporter of record
  • The exporter must complete an export declaration
  • The exporter must provide key documents to their freight forwarder e.g the road consignment note, copies of export licenses, and the movement reference number from the export declaration