On 24 December 2020, the new EU-UK Trade and Cooperation Agreement was agreed in principle and has come into force on 1 January 2021.
From 1 January, the trade and movement of goods between the UK and the EU are subject to the new terms and rules outlined in the Agreement. It has been agreed that for many products no import duties have to be paid on either side.
For our parcel industry, it means that between the UK and the EU:
As of 1 January 2021
Exports to the UK - Goods below 135£
Important changes to EU VAT rules from 1 July 2021
The 22€ value added tax (VAT) exemption on goods imported to the EU will be removed. This means that all goods regardless of value will now be subject to VAT.
The introduction of the Import One Stop Shop (IOSS) to facilitate and simplify the declaration and payment of VAT for distance sales of imported goods (B2C) with a value not exceeding 150€.
The online marketplaces become the VAT collector for B2C goods up to 150€ if they are IOSS registered.
As of 1 July 2021
Exports to the EU - Goods below 150€
Registering for the IOSS is beneficial for sellers, buyers and carriers as the IOSS facilitates the declaration, payment and collection of VAT.
DPDgroup is aware of the administrative complexity and challenge of this new EU VAT reform especially when an intermediary is mandatory for IOSS registration.
To help its customers to find an intermediary, DPDgroup has carefully selected a number of reliable partners who can assist you with simple registration and intermediary services.
KPMG service for IOSS registration
EORI stands for Economic Operator Registration and Identification number. For any scenario, this number is mandatory for exporting and importing goods to/from the UK.
Apply for an EORI number if you do not already ship goods outside the EU. The registration for the EORI can be done via the website of local customs authorities. It can take up to 3 days to get this EORI number.
EORI Number = Country code + unique national number
Example of EORI number for a Polish exporter (country code PL) whose unique national number is 1234567890ABCDE → PL1234567890ABCDE
The HS codes are also known as Commodity Codes. These codes allow customs to identify the type of product, the VAT or duty rate that applies to the product to be exported. Goods cannot be exported or imported without these HS codes.
The HS codes can be found on this website: http://ec.europa.eu/taxation_customs
1 to 6 are worldwide identical (except some countries)
7 to 10 : details of the commodities
11 to 14 : additional code at import impacted the duty code
For shipments done either via API (Application Programming Interface), an integrated system or EDI (Electronic Data Interchange), there will be necessary IT updates to be done in preparation for Brexit to ensure that data such as descriptions, values or HS codes are included and on DPD format.
Potentially, if data is not complete and/or incorrect, parcels will not leave the sending country.
A commercial or pro forma invoice is needed when you ship goods outside the EU.
A commercial invoice is used when the goods are related to a commercial transaction or for resale
A pro forma invoice is used when sending goods without any commercial value (for example samples)
Both documents are a declaration including all information related to goods, that will be used by customs authorities in order to evaluate the duties or taxes to pay.
For any specific question related to Brexit, please contact your local sales representative.