What consequences does Brexit have for the delivery of my orders?
After a long and difficult process the UK has officially left the EU since the beginning of this year. A lot has been written and you might have already read much about it however, for the sake of clarity we have made an overview of the impact Brexit will have on your online business.
Starting from 1 January there is no more free traffic of goods and people between the United Kingdom and the European Union. This means that every package sent to the United Kingdom will be checked by customs. This could mean your orders will arrive a day later than you’re used to. Every package also has to be accompanied by the right documents in order to pass through customs. If any of the required documents are lacking, the parcel will be returned to the sender.
In order to make sure your logistics are compliant in a post-Brexit world, you can use the following checklist to make sure that you are prepared and your orders will arrive as usual. You should consider the following 6 steps (source: PostNL):
- Register your company with the British Authorities.
- Acquire an EORI-number (customs number) from the British Government
- Arrange your return policy
- Share customs information
- Update your systems
- Check if your data is 100% correct
We will discuss these steps further below.
1. Register your company with the British Authorities.
You are now responsible for paying VAT to the British Government. This applies to orders and shipments below £135 to the UK. For orders above £135 you might have to pay import duties and clearance costs on top of the VAT. The VAT payments for orders above £135 works a bit differently since the receiver pays the taxes and additional costs to our import partner in the UK.
If you only sell B2B and your client has a VAT-number then you don’t have to register.
2. Acquire an EORI-number (customs number) from the British Government
Apply for an Economic Operator’s Registration and Identification (EORI)-number at the British Government. You need this number to register your goods at the British Customs and trade with the United Kingdom. You can register for an EORI-number if you follow this URL to the website of the British Government.
Even if you already have a customs number to trade outside of the EU you will still have to apply for an EORI-number. The UK has their own numbers so always apply.
3. Arrange your return policy
What if your English customers want to return their order? This process looks exactly the same the other way around. They will have to register the goods at Dutch customs and will have to pay VAT and, if applicable, import duties and clearance costs. If you want less hassle then you can apply for an “article 23 licence” for your return goods. This allows you to add the import costs to your own VAT declaration so you don’t have to pay VAT for each item separately. You can find more information on this VAT licence on the website of the European Union.
The application process for an article 23 licence takes around 8 weeks to complete. There are also other options available so make sure you check with your accountant or tax-advisor what solution works best for you.
4. Share customs information
Every shipment should contain a customs form, otherwise it can’t be processed. The form should contain additional information about your shipment. What are you shipping? What is it worth? You should also enter an HS code, which is a code the British customs use to review and classify shipments. You can find the right code for your products here.
5. Update your systems
From now on you will have to provide additional information for British Customs. This means the shipping label will have a different look and size than your used to. In order to streamline and automate the logistics process your own systems will need to be ready to share this additional information.
6. Check if your data is 100% correct
Double check if your data is 100% correct and nothing is missing. If any information is incorrect or missing customs will return the parcel back to the sender. Make sure you fill in a complete trade invoice, if you follow this URL you can find a template so you don’t have to worry about missing any vital information.
If you still have any questions regarding Brecit and the consequences for your business feel free to contact our customer service at +31 (0)18 – 66 12 267 or firstname.lastname@example.org.
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