2 October 2019
If you're a VAT-registered business find out when you can account for import VAT on your VAT Return for goods brought into the UK in a no-deal Brexit
If your business is registered for VAT in the UK you’ll be able to account for import VAT on your VAT Return. This means you will pay import VAT on your VAT Return instead of when the goods arrive at the UK border.
This will let your business:
- maintain cash flow on goods you bring in from the EU
- pay import VAT later on goods you bring in from non-EU countries
If you’re not VAT-registered in the UK you will not be able to account for import VAT in this way, you’ll need to pay import VAT at the time you import the goods.
You’ll need an Economic Operator Registration and Identification (EORI) number that starts with GB when you import the goods into the UK.
When you can account for import VAT on your VAT Return
You can account for import VAT on your VAT Return if:
- the goods you import are for use in your business
- your VAT registration number is shown on your customs declaration, or EORI number if you’re using the Customs Handling of Import and Export Freight (CHIEF) system
The goods can be imported from anywhere in the world.
You can account for import VAT when the goods enter the UK, or when they’re released into free circulation through one of the following customs special procedures:
- customs warehousing
- inward processing
- temporary admission
- end use
- outward processing
If you use transitional simplified procedures you must account for import VAT on your VAT Return.
Postal imports worth £135 or less
If you import goods for use in your business and the seller sends them as a parcel in the post, you will not be able to account for import VAT on your VAT Return if the goods are worth £135 or less.
You should pay the import VAT up front and the overseas seller of the goods must account for the import VAT. You should use the invoice to reclaim the import VAT on your next VAT Return.
Goods already in transit before Brexit
You must continue to treat goods already in transit from the EU as acquisitions and account for VAT on the return for the period in which the acquisition takes place.
If you’re bringing goods into the UK under customs freight simplified procedures and you’ve completed your simplified frontier declaration before Brexit, you will not be able to account for import VAT on your VAT Return even if you complete your supplementary declaration after this time.
If you have an agent
You can authorise your agent to account for import VAT on your VAT Return.
To make customs declarations for you and account for import VAT on your VAT Return, your agent should:
- use your VAT registration number or EORI number
- have your agreement to account for import VAT on your VAT Return
Agents must not use their own VAT registration number.
How to account for import VAT
If you use software or the CHIEF system to declare your customs duties, you’ll need to:
- input your EORI number (which includes your VAT registration number) into either registered consignee (SAD box 44h) or consignee (SAD box 8)
- enter ‘G’ as the method of payment
If you use the new Customs Declaration Service (CDS) to declare your customs duties you need to enter your VAT registration number at header level in data element 3/40.
VAT will be recorded against your EORI and will be at declaration level only.
You can still account for import VAT on your VAT Return, even if you cannot confirm the customs value of the goods that you import. You should declare the highest value for VAT and reclaim any eligible input tax under the normal rules.
VAT Notice 252 has more information on the customs value of goods
If you do not account for import VAT on your VAT Return
If you choose not to account for import VAT on your VAT Return, you’ll need to wait two months after paying the import VAT before you can reclaim it.
You will also have to declare import VAT when the goods arrive in the UK or enter free circulation if you use:
- CHIEF to make declarations, you could select to pay or secure the import VAT by declaring the method of payment on the VAT tax line
- CDS to make declarations, you would not enter your VAT registration number at header level in data element 3/40
What you need to do next
Once you’ve imported the goods, you’ll need to account for import VAT when you complete your VAT Return.