Brexit and the Impact on SAP Customers. Part 5
Author: Claire Neale, Solution Architect, NTT DATA Business Solutions UK.
This is the fifth in the series of Brexit blogs I am delivering in an effort to guide you through the muddy waters of Brexit. This blog specifically captures the top challenges faced by UK businesses as a result of Brexit.
Checklist of Considerations
- EORI number – if you export goods to countries in the EU and Northern Ireland ensure you have both an EU and NI EORI number; you will no longer be able to use your GB EORI for this scenario
- Customs declaration forms are complex, unless you are experienced in preparing these (they can be up to 12 pages long). HMRC recommend that you use a customs broker or freight forwarder to provide this service for you – Read more
- Commodity codes (also referred to as HS Codes) are key to identifying the product plus the country and are used to determine the applicable duty tariff. If these are not completed correctly then you could be charged the wrong tariff, experience customs delays and shipment rejections
- Country of Origin – this has caused many issues over recent weeks, resulting in some organisations suspending deliveries to NI / EU whilst issues are resolved, and others changing their logistics processes resulting in significant cost impact
– Whilst tariff free trade was agreed between UK & Northern Ireland / EU, this only applies where the country of origin of the goods is UK or somewhere in Europe or Northern Ireland. The importer now has an obligation to produce a statement that they have documentary proof that the imported goods comply with the rules of origin. If they originate in either EU or UK then no tariffs apply, however if over 40% of the total value of the goods is sourced from outside of the EU/UK, then tariffs apply. The statement should be included on the sales invoice, pro-forma invoice or other similar commercial document, including a description to identify the goods to enable identification.
- Distance Selling (web, mail order etc.) – where a UK business sells into a country in Europe they now need to register for VAT in that country and in some countries appoint a fiscal representative. A fiscal representative is a local entity which represents foreign traders for VAT purposes
This applies where the non – EU established business has a local VAT registration in the specific country which mandates a fiscal representative.
The table below identifies the countries where this is mandated;
(Please note this has changed since my last blog.)
Additionally the following countries outside of the EU also require a fiscal representative:
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Remember to check back regularly for the next in our Blog series on Brexit.