Sales of goods shipped to customers in the EU become exports, regardless of the status of the buyer; all are zero-rated, subject to the relevant evidential requirements which in some respects, it should be noted, are more onerous than those applying to EC sales. Indeed, any exporter of goods to any overseas destination should take account of HMRC’s guidance on what is required of export evidence, which can be found in Section 6 of VAT Notice 703 and paragraph 6.5 in particular, and which they apply very strictly indeed.
Acquisitions of goods from the EU become imports, in principle meaning that VAT becomes payable at the port of entry and is then only claimable on a subsequent VAT return. This would have presented a potentially significant cash flow hit for businesses purchasing goods from the EU, but has been mitigated by the reintroduction of postponed accounting for VAT on imports (see the separate blog).
Unlike EC sales and acquisitions, exports and imports require individual declarations to be made at the time of departure or arrival of the goods; businesses need to ensure they have put procedures in place to make such declarations, either by investing in the necessary systems or (in most cases) by appointing an import/export agent to undertake the formalities on their behalf. The massive increase in the number of declarations in 2021 (estimated at about five times the 2020 figure) has given rise to concerns regarding a potential shortage of resources in this regard, so please look into this now if you haven’t already done so.
In principle there should after the end of 2020 be no requirement for Intrastat returns, which makes HMRC’s assertion (on www.uktradeinfo.com, rather than www.gov.uk) that they will be retained for goods arriving in the UK difficult properly to understand. Final confirmation of the position is awaited.