Brexit: The latest guidance from HMRC in just 30 minutes

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HMRC’s recent Webinar, attended by the MIA team, provided a number of useful tips for music industry companies managing the Brexit minefield. You can watch the webinar back, and we’d recommend that you start watching at 9:00 minutes in – it will take just 30 minutes.

Of particular note is that from 1 January 2021 – all wood packaging material moving between the UK and EU must meet international standards by undergoing heat treatment and marking. If you export to the EU using pallets on a regular basis, the MIA recommends that you source pallets which meet this new standard now.

The webinar also focused on:

  • The Trader Support Service
  • Preparing to export – actions from 1 January 2021
  • Finding out if you can charge 0% VAT
  • Customs declarations
  • Who can help you?
  • What to do now

Click on the video below to watch, we would recommend that you start watching from 9 minutes:

The Brexit Webinar Handout includes the latest information, you can read and download that below: 

HMRC Brexit Webinar Handout

Finally, we also captured the very helpful Q&A session which HMRC staff were answering in real time during the webinar. You can read the full Q&A below: 

Q: How do I apply for an EU & XI EORI number I have a UK one? Thank you

A: To apply for a UK EORI go to www.gov.uk/eori.

If you need to apply for an EU EORI you will need to apply to the customs authority in the member state where you have a permanent business established. If you do not have a permanent business establishment in an EU member state, you will need to apply to the custom authority in the member state where you first make a declaration or apply for a customs decision. If you need to apply for an EU EORI, the following link: ec.europa.eu/taxation_customs/national-customs-websites_en provides contact details for customs authorities in EU Member States.

Q: How is the MRN generated from ICS?

A: The MRN is a customs identification number that’s created each time a declaration is submitted for importing or exporting goods.

Q: Please explain Customs warehouse

A: Latest guidance on Customs Warehousing can be found at the following link – https://www.gov.uk/guidance/how-to-use-a-customs-warehouse

Q: Do you need an EU EORI number in each country your export to in the EU or will one EU EORI number cover all countries in the EU?

A: You will need a UK EORI number to engage with UK customs processes and an EU EORI number to engage with EU customs processes. For more information about UK EORI go to www.gov.uk/eori

For more information on how to apply for an EU EORI to your member state go to http://ec.europa.eu/ecip/information_resources/databases/index_en.htm

Remember you only need one EU EORI that can be used throughout all member States.

Q: Hi, we do not export physical goods to the EU but we do provide project management services. Will any of these changed affect the way we currently work?

A: Guidance on providing services to EU is available at the following link – https://www.gov.uk/guidance/providing-services-to-any-country-in-the-eu-iceland-liechtenstein-norway-or-switzerland-after-eu-exit

Q: My company manufactures parts in the UK which are sold to our german partners on an ex works basis. The german customer takes full ownership of the export of these goods to Germany. We have an Eori number in place. Q. Is there anything else we need to do from first Jan 2021?

A: For UK customs exports see guidance here to check preparations https://www.gov.uk/prepare-to-export-from-great-britain-from-january-2021 and for EU requirements the Border Operating Model has information at Annexes A & B

Q: Do I need a different EORI for Northern Ireland? Also what about CE certification is there changes to this?

A: From 1 January 2021 you’ll need an EORI number that starts with XI to:

  • move goods between Northern Ireland and non-EU countries
  • make a declaration in Northern Ireland
  • get a customs decision in Northern Ireland

To get an EORI number that starts with XI, you must already have an EORI number that starts with GB. If you do not have one, apply for an EORI number that starts with GB as soon as possible. If you already have an EORI number that starts with GB and HMRC thinks you need one that starts with XI, they’ll automatically send you one in mid-December 2020.

To ensure HMRC sends you an XI EORI number, you can sign up to the Trader Support Service.

Q: Who do I contact to follow up a duty deferment account application?

A: https://www.gov.uk/guidance/apply-for-an-account-to-defer-duty-payments-when-you-import-or-release-goods-into-great-britain

Q: Are you going to cover how to determine customs / commodity codes for non standard items (for example material handheld machines such as drum lifters for Pharmaceutical) customers?

A: To find commodity codes for importing into or exporting out of the UK or the EU search for ‘finding commodity codes’ on GOV.UK or go to: https://www.gov.uk/guidance/finding-commodity-codes-for-imports-or-exports

The new UK Global Tariff will apply to goods imported into the UK on and after 1 January 2021 unless an exception such as a preferential arrangement or tariff suspension applies.

For more information go to GOV.UK https://www.gov.uk/guidance/uk-tariffs-from-1-january-2021

Q: If our customer in the EU collects products do they deal with all the relevant paperwork or do we still have to complete our own declaration?

A: After transition declarations will be needed at the UK export and EU import sides for GB – EU movements. You should discuss with your intermediary and your EU customers what services they are providing and what your responsibilities will be. You can find more information on exporting here – https://www.gov.uk/prepare-to-import-to-great-britain-from-january-2021

Q: What Trade agreement are we on currently and what is the difference between World Trade Organisation and the Free Trade Agreement please

A: Trade Agreements is led by the Department for International Trade. The latest guidance can be found at the following link – https://www.gov.uk/guidance/uk-trade-agreements-with-non-eu-countries

Q: Is the XI EORI# the same as an EU EORI# as if it was issued by France, Ireland, Germany, etc?

A: Yes. If you already have a UK EORI you can continue to use this once the UK leaves the EU.

If you move goods to or from Northern Ireland. From 1 January 2021 you’ll need an EORI number that starts with XI to:

  • move goods between Northern Ireland and non-EU countries
  • make a declaration in Northern Ireland
  • get a customs decision in Northern Ireland

To get an EORI number that starts with XI, you must already have an EORI number that starts with GB. If you do not have one, apply for an EORI number that starts with GB as soon as possible.

https://www.tax.service.gov.uk/customs/register-for-cds/isle-of-man  

If you already have an EORI number that starts with GB and HMRC thinks you need one that starts with XI, they’ll automatically send you one in mid-December 2020.

Q: When exporting goods – Do I need to know my recipient’s EORI or VAT number and include it on any customs documentation?

A: If you are responsible for making the customs declaration then you will require the EORI number details.

Q: If sending goods from Northern Ireland to England is this classed as ‘exporting’?

A: For Information regarding Customs procedures for moving goods between Ireland and Northern Ireland after the transition period ends please visit

https://www.gov.uk/guidance/customs-procedures-for-goods-moving-between-ireland-and-northern-ireland-if-the-uk-leaves-the-eu-without-a-deal

Q: Are you able to advise if I’m exporting to Ireland, do I have to register for VAT in Ireland?

A: For guidance on moving goods into, out of, or through Northern Ireland, please see guidance for what UK businesses can do now to get ready for 1 Jan 2021 – https://www.gov.uk/government/collections/moving-goods-into-out-of-or-through-northern-ireland-from-1-january-2021. For guidance on registering for VAT in EU Member States – https://www.gov.uk/vat-registration/registering-vat-eu-countries

Q: When exporting through FPO’s or standard couriers (FedEx, DHL etc) – who completes the custom declaration?

A: The customs export declaration requirements currently in place for the movement of goods by post and parcel between the UK and non-EU countries will extend to movements between GB and the EU after the end of the transition period.

For postal consignment exported by the Royal Mail Group (RMG) – the UK’s designated universal postal service provider – the use of the CN22 and/CN23 customs forms will apply for non-controlled goods not exceeding £900 in value. For all other postal movements, an electronic full customs declaration will need to be submitted to HMRC. Items of correspondence (letters, postcards, and braille letters) can be imported through a declaration by conduct.

Q: Do e-commerce sellers currently selling under distance thresholds have to register for VAT in each country they sell into?

A: For more information please visit – https://www.gov.uk/government/publications/changes-to-vat-treatment-of-overseas-goods-sold-to-customers-from-1-january-2021

Q: Will we get communication confirming the last EC sales list and Intrastat returns that will be required to be submitted? Or do we just submit for December 2020 and then no more returns due.

A: If the transition period ends without a deal, UK VAT-registered businesses won’t need to complete an EC sales list (ESL) for sales. An ESL needs completing for sales of goods and services made to EU VAT-registered businesses before the end of transition. UK businesses can continue to zero-rate sales of goods to EU businesses with changes to how these are recorded. UK businesses exporting goods to EU businesses need to keep evidence to prove goods left the UK, to support their zero-rating of goods. As part of current processes most businesses already maintain evidence and will be like what’s currently required for exports to non-EU countries. We’ll communicate any differences later. Current EU rules would mean EU member states will treat goods entering from the UK in the same way as goods entering from other non-EU countries, with associated import VAT and customs duties due when the goods arrive into the EU. Individual EU member states may have different rules for import VAT for non-EU countries and import VA

Q: I have submitted a duty deferment application but not had confirmation of the application. who do i contact to see if/when the application has been successful?

A: Please refer to contact details in the following link – https://www.gov.uk/government/organisations/hm-revenue-customs/contact/duty-deferment-scheme-general-enquiries

Q: If I send goods (B2B) to the Republic of Ireland, via Northern Ireland (I am based in the UK), do I still need an XI EORI number and how do I show this on my VAT return?

A: For Information regarding Customs procedures for moving goods between Ireland and Northern Ireland after the transition period ends please visit

https://www.gov.uk/guidance/customs-procedures-for-goods-moving-between-ireland-and-northern-ireland-if-the-uk-leaves-the-eu-without-a-deal

Q: We have a GB EORI number, we haven’t yet received an XI EORI , we are a UK company that occasionally ships to Northern Ireland. Should I apply for an XI EORI?

A: From 1 January 2021 you’ll need an EORI number that starts with XI to:

  • move goods between Northern Ireland and non-EU countries
  • make a declaration in Northern Ireland
  • get a customs decision in Northern Ireland

To get an EORI number that starts with XI, you must already have an EORI number that starts with GB. If you do not have one, apply for an EORI number that starts with GB as soon as possible.

If you already have an EORI number that starts with GB and HMRC thinks you need one that starts with XI, they’ll automatically send you one in mid-December 2020.

To ensure HMRC sends you an XI EORI number, you can sign up to the Trader Support Service.

Q: Can we declare low value for the returned items for repair?

A: For more information on customs special procedures that enable you to suspend, pay less or no duty on goods you import or export, please see – https://www.gov.uk/government/collections/pay-less-or-no-duty-on-goods-you-store-repair-process-or-temporarily-use

Q: Do you still need to register and use CHIEF if you use a courier service ie UPS?

A: You are responsible for ensuring a customs declaration in made when importing or exporting goods. You can complete this yourself or appoint an intermediary such as a freight forwarder or fast parcel operator to do this for you.

If you’re making the declaration yourself you will need to get the software to use the CHIEF system

If you use a third party, the rules for how customs agents represent traders are changing. From 1 January 2021, customs agents will be able to make simplified declarations for you using their own authorisation; so, you don’t need to be authorised. They can only do this if:

  • your business is established in the United Kingdom
  • your business imports goods into Great Britain (England, Scotland and Wales) and the customs agent has the appropriate authorisation

The type of representation you agree with your agent will affect your roles and responsibilities. You can find more information at www.gov.uk/guidance/appoint-someone-to-deal-with-customs-on-your-behalf.

Q: Exporting goods from (NI) to ROI? What do I need?

A: For Information regarding Customs procedures for moving goods between Ireland and Northern Ireland after the transition period ends please visit

https://www.gov.uk/guidance/customs-procedures-for-goods-moving-between-ireland-and-northern-ireland-if-the-uk-leaves-the-eu-without-a-deal

Q: In my company we often have to return goods to suppliers for repair. As a guideline, how long with SIEL take to do this?

A: The following provides latest guidance on you goods you export to process or repair – https://www.gov.uk/guidance/apply-to-pay-less-duty-on-goods-you-export-to-process-or-repair

Q: Is this webinar applicable to (NI) traders or only GB

A: There is guidance available if moving goods between GB and Northern Ireland – https://www.gov.uk/government/collections/moving-goods-into-out-of-or-through-northern-ireland-from-1-january-2021. The Trader Support Service can also help guide you through any changes due to the implementation of the Northern Ireland Protocol – https://www.gov.uk/guidance/trader-support-service

Q: I have an AEO-C approval. I was told that AEO won’t be recognised by the EU any longer. Is this correct?

A: If traders currently hold AEO status issued by another EU customs authority which covers their customs operations in the UK, this will not be recognised in the UK and will not secure the benefits of AEO status in the UK.

Current guidance issued by the EU is that AEO authorisations issued by the UK will no longer be valid in the EU from 1 January 2021.

Q: We export 2 or 3 times a year to EU countries (bottled beer), is there a way of completing declarations ourselves using NES and CHIEF but without needing to buy any additional / specialist software

A: If you move goods between Great Britain and the EU, you will need to submit your import and export declarations using the Customs Handling of Import and Export Freight (CHIEF) system.

More information about accessing CHIEF (Customs Handling of Import and Export Freight) can be found at: https://www.gov.uk/guidance/chief-trader-import-and-export-processing-system

If you move goods between Great Britain to Northern Ireland, you will need to submit your import and export declarations using the Customs Declaration Service (CDS). You should also register for the Trader Support Service (TSS) When moving goods between Great Britain and Northern Ireland.

More information about accessing CDS (Customs Handling of Import and Export Freight) can be found at: https://www.gov.uk/government/collections/customs-handling-of-import-and-export-freight-chief-replacement-programme

Q: I am having difficulty establishing country of origin of exported machined parts to the EU. who can i talk to about this?

A: The following guidance may support – https://www.gov.uk/guidance/check-your-goods-meet-the-rules-of-origin

Q: Must the EORI number be mentioned on the invoice?

A: This is up to you. HMRC does not require you to.

Q: Do I still need to submit EC Sales after 1st Jan?

A: If the transition period ends without a deal, UK VAT-registered businesses won’t need to complete an EC sales list (ESL) for sales. An ESL needs completing for sales of goods and services made to EU VAT-registered businesses before the end of transition. UK businesses can continue to zero-rate sales of goods to EU businesses with changes to how these are recorded. UK businesses exporting goods to EU businesses need to keep evidence to prove goods left the UK, to support their zero-rating of goods. As part of current processes most businesses already maintain evidence and will be like what’s currently required for exports to non-EU countries. We’ll communicate any differences later. Current EU rules would mean EU member states will treat goods entering from the UK in the same way as goods entering from other non-EU countries, with associated import VAT and customs duties due when the goods arrive into the EU. Individual EU member states may have different rules for import VAT for non-EU countries and import VA

Q: How do I find out how much duty to pay? Is there a calculator online?

A: You will need one if you have duties and taxes to pay or are not VAT-registered or intend to use the simplified declarations processes. You can work out whether you have customs duties to pay by checking the no deal tariff schedule https://www.gov.uk/guidance/check-temporary-rates-of-customs-duty-on-imports-after-eu-exit

Q: Can you provide a link regarding charging of VAT?

A: If the UK leaves the EU without an agreement, rest of world rules will apply. VAT registered UK businesses will continue to be able to zero-rate sales of goods to EU businesses, subject to keeping the required records. In addition goods shipped to consumers will also be zero-rated, subject to keeping the required records. Please view the public notice on exported goods here. https://www.gov.uk/guidance/vat-on-goods-exported-from-the-uk-notice-703

Q: Where will I find the latest information on recharging services provided in the UK to EU customers. Currently this is subject to reverse charge. what happens after 31 December?

A: Services are taxed where they are deemed to be supplied by law. In principle the rules will generally be the same as currently Business to Business supplies of services are generally supplied where the customer belongs. Services received in in the UK may be accounted for under the reverse charge by the customer, though some types of services may require your supplier to VAT register here. For Business to Consumer supplies the default is where you, the supplier, belongs unless one of the exceptions apply. Many B2C supplies fall under the exceptions and are deemed to be supplied where the customer belongs or where he effectively uses or enjoys the services. For further information on reverse charges view section 5.1 of the ‘place of supply’ guidance here. https://www.gov.uk/guidance/vat-place-of-supply-of-services-notice-741a#sec5

Q: what if you send goods to Northern Ireland from England but invoice a company based in England?

A: If moving goods between GB and Northern Ireland, please see https://www.gov.uk/government/collections/moving-goods-into-out-of-or-through-northern-ireland-from-1-january-2021  and the Trader Support Service is available to sign up and guide you through any changes due to the implementation of the Northern Ireland Protocol. – https://www.gov.uk/guidance/trader-support-service

Q: Can you use more than 1 agents?

A: Intermediaries can help traders find the information needed to complete formalities and submit the required declarations, for example customs information to HMRC systems. More information can be found on gov.uk at https://www.gov.uk/guidance/appoint-someone-to-deal-with-customs-on-your-behalf

Q: How do you access ICS? Government Gateway does not work.

A: The following link takes you through to the ICS login through the Government Gateway – https://www.gov.uk/government/publications/import-control-system-ics-service-availability-and-issues/import-control-system-service-availability-and-issues  The latest update is that a Full service is available. If you are unable to access through the link it might be worth trying again a bit later on.

Q: Where can I find customs agent? 

A: Freight Forwarding or customs agents generally operate out of the UKs major ports and airports. HMRC does not provide a specific list but details can be found on-line with a simple internet search.

Q: How do we access the NES?

A: Please refer to the guidance at the following link – https://www.gov.uk/guidance/export-declarations-and-the-national-export-system-export-procedures