01/02/2021

Business Readiness Bulletin - Brexit: New rules are here - 1 February 2021

Please see the latest Business Readiness updates below.

CONTENTS

UK applies to join huge Pacific free trade area Comprehensive and Progressive Trans-Pacific Partnership (CPTPP)

The UK is formally applying to join one of the world’s largest free-trade areas, deepening trade ties with some of the fastest-growing markets in the world.

Today, Monday 1 February, international trade secretary Liz Truss MP is speaking to ministers in Japan and New Zealand to request to join the CPTPP, with formal negotiations to start this year.

Joining the CPTPP would deepen the UK’s access to fast-growing markets and major economies, including Mexico, Malaysia and Vietnam, for the benefit of UK business.

Benefits to business of CPTPP membership include:

  • Modern digital trade rules that allow data to flow freely between members, remove unnecessary barriers for businesses, and protect commercial source code and encryption.
  • Eliminating tariffs quicker on UK exports including whisky (down from 165% to 0% in Malaysia) and cars (reducing to 0% in Canada by 2022, two years earlier than through the UK-Canada trade deal).
  • Rules of Origin that allow content from any country within CPTPP to count as ‘originating’. For example, this would mean that cars made in the UK could use more Japanese-originating car parts, such as batteries.
  • Easier travel for businesspeople between CPTPP countries, such as the potential for faster and cheaper visas.

For further details, click here

HMRC answer Frequently Asked Questions on New Trade rules
New rules for businesses that trade with Europe are here. Now that the Brexit transition period has ended, all businesses that move goods between Great Britain and countries in the EU, or under the Northern Ireland Protocol, must follow new customs and tax rules since 1‌‌‌ ‌January 2021. HMRC have provided answers to some of the most frequently asked questions on the new trade rules.

1. Customs processes are complicated. Who can help me complete them?
Most traders find that they need specialist support to help with importing from or exporting to the EU. For instance, you might decide to use a customs intermediary. A customs intermediary is someone who makes customs declarations for you or your business. This could be:

  • a freight forwarder – a company that helps their clients move cargo globally, including supporting the customs process
  • a customs agent or broker – these make sure your goods clear through customs.

If you decide to use an intermediary, make sure you approach them as soon as possible, as there is high demand for these services. You can find a list of businesses that can help on GOV‌.UK.

There are still specific actions you will need to take if you get an intermediary to help you with your customs declarations. You will:

2. My business is located in the United Kingdom and I export goods to EU customers, can you explain how I should account for VAT?
If you sell, send or transfer goods out of the UK you do not normally need to charge VAT on them in the UK. You can zero-rate most exports from:

  • Great Britain to a destination outside the UK
  • Northern Ireland to a destination outside the UK and EU.
  • If you incorrectly charge UK VAT on exports of goods, your customers may also have to pay VAT in the country where the goods are imported.
    Different rules may apply in different countries. Therefore, it’s important that you understand the import VAT rules of each EU country that you sell to.
    You can find out more about exports, sending goods abroad and charging VAT on GOV‌.UK.

3. I send goods from the United Kingdom to my customers in the EU, has anything changed about how I should account for VAT?
Yes. Previously, before the end of the transition period:

  • VAT was due on the goods that you sold to your EU customers. If your EU customer was not VAT registered themselves (for example, because they were a private individual) you accounted for UK VAT in the UK. If your sales to EU customers breached an annual distance selling threshold you had to register for VAT in that EU Member State and account for EU VAT in that country.
  • If your EU customer was registered for VAT in their own country your business zero-rated the sale as a 'dispatch' and your EU customer accounted for the VAT as an 'acquisition' in their own country.

Now, following the end of the transition period:

  • if you are a business subject to the Northern Ireland protocol, the above rules will still apply.
  • if you are a business moving goods from Great Britain to the EU, your goods should be zero-rated exports from the UK and import VAT will be due to be collected from the EU recipient at import into the EU and subject to EU rules.
  • different rules may apply in different countries – therefore, it’s important that you understand the import VAT rules of each EU country that you sell to.
  • you can find more information and guidance about the conditions for zero-rating VAT on the goods you export, and what you should do when you export goods in specific circumstances on GOV.UK.

Importing and Exporting
UPDATED: Claiming preferential rates of duty between the UK and EU: Guidance on claiming preferential rates of duty on goods covered in the UK’s deal with the EU and how to declare goods imported into the UK on your import declaration has been updated. Guidance now includes a clarification to the statement of origin section and the need to identify goods that are originating and non-originating. For more information, click here.

Moving Goods
NEW: Border and Protocol Delivery group video series:  The Border and Protocol Delivery Group have produced a video series on border readiness at the end of the transition period on the following:

NEW: Moving goods under transit: The latest edition of the Community, Common Transit and Transport International Routiers (TIR) Newsletter is now available. The newsletter focusses on helping traders avoid some problems they may be experiencing when moving goods under transit. To view this, and previous editions of the newsletter, click here.

NEW: Groupage consignments: The Department for Environment, Food & Rural Affairs (DEFRA) have been working with their Northern Irish counterparts at the Department of Agriculture, Environment and Rural Affairs (DAERA) alongside hauliers, to establish a new Groupage model which will aid the movements of these loads into Northern Ireland. Following successful trials with industry (involving taking goods from GB to NI), two Groupage models have been agreed: consolidation hubs model and linear model.  To view groupage guidance for traders and hauliers, click here.

UPDATED: List of customs agents and fast parcel operators: The list of agents and operators who can help submit customs declarations has been updated. For more information, click here.

Business information
HMRC support for businesses that trade with the EU
HMRC will continue to provide support to help businesses adjust to the new rules and help keep their business moving. If businesses need more support, they can:

  • sign up to receive weekly trader updates that provide hints and tips on getting used to the new rules. There is also information about where to access more support.
  • register for the free Trader Support Service if they are moving goods between Great Britain and Northern Ireland.
  • attend one of our live webinars or watch one of our short films about importing and exporting.
  • use the Brexit checker on UK to understand HMRC processes for importing, exporting or customs relief and keep their business moving.

call HMRC’s Customs & International Trade Helpline and speak to an advisor on 0300 322 9434.

Sector specific guidance

Life Sciences
UPDATED: Guidance on pharmacovigilance procedures:  Guidance has been updated with a new  recording of a webinar, which took place on 13 January 2021, on pharmacovigilance requirements for the UK authorised products. For more information, click here.

Food and Drink
UPDATED: How to export wild caught marine fishery products to the EU from 01 January 2021:
The guide for exporters of fish and seafood has been updated. For more information, click here.

UPDATED: Great Britain nutrition and health claims (NHC) register: Guidance on the register of nutrition and health claims that may be made in commercial communications in Great Britain has been updated with a new sheet that lists the nutrition claims on the register. For more information, click here.

Webinars and Podcasts

  • Video content to keep your business moving: New short on-demand videos covering the new rules on exports, imports, tariffs, data and hiring are available to view here.
  • HSE working with Chemicals podcast. The latest episode of the working with chemicals podcast is now available. In this instalment, HSE are joined by two industry voices to discuss the changes to Biocidal (BPR) and Plant Protection Product (PPP) regulations and explore the actions they have taken to keep their businesses moving following the end of the UK transition period. To listen to this episode, click here.
  • Webinars for businesses that trade with the EU: Click here to view a list of webinars you can sign up to watch live or on demand.
  • HMRC customs declarations webinars: HMRC have launched multiple editions of this live webinar, covering how to complete customs import declarations and explaining how to make import declarations when importing goods between the EU and Great Britain. To register and find a date, click here.
  • HMRC webinars: Get help on UK transition with online webinars from HMRC on:
    • Importing: staged controls and how to prepare to use them
    • Exporting: actions you need to take to prepare for 1 January 2021

To register, and for more information, click here.

Department for Business, Energy and Industrial Strategy 

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