Are you ready to trade outside Northern Ireland?

What are the implications of trading outside Northern Ireland?

Selling to customers outside Northern Ireland will change your business. Like any fundamental change to the way you trade, there are risks as well as rewards. You should weigh them up before starting to move into overseas markets.

Advantages

  • You could significantly expand your markets, leaving you less dependent on any single one.
  • Greater production can lead to larger economies of scale and better margins.
  • Your research and development budget could work harder as you can change existing products to suit new markets.

Issues to consider

  • Unless you're careful, you can lose focus on your home markets and existing customers.
  • Your administration costs may rise as you may have to deal with export regulations when trading outside the European Union.
  • You will be managing more remote relationships, sometimes thousands of miles away.
     
  • In overseas markets, you may lose some of the control that you are used to at home.
  • You will need to think of your new market differently to the home market. They will be different customers with their own reasons for buying your products.

For more information, see our guide on the risks and rewards of exporting.

Tax considerations

You will have different responsibilities for VAT depending on whether you sell to other European Union (EU) countries or export your goods outside of the EU.

If you sell to other countries in the EU, you must keep records and submit details of these sales on your VAT return. If you have a high level of sales to EU countries, you must complete an Intrastat Supplementary declaration. See our guide on how to complete the Intrastat return.

If you sell to countries outside the EU, you must keep documents that count as proof of export. These must identify:

  • the exporter
  • the customer
  • the goods and their value
  • the export destination
  • the mode of transport and the route.

In both cases, most goods you export will be zero-rated for VAT. You should check with HM Revenue and Customs (HMRC). You can find out about your tax responsibilities when exporting on the HMRC website.