The importer of record can choose to apply PIVA to account for import VAT. This means that the importer does not have to pay import VAT at the time the goods are released into the UK, but instead the import VAT is accounted for on the VAT return as both payable VAT (sales) and receivable VAT (purchases, with the amount of recovery dependent on the business’ recovery position).
This results in an improved cashflow position.
Entries will be made as follows:
Post Brexit, sales of goods from the UK (excluding Northern Ireland) to an EU VAT registered business are exports (previously known as dispatches) i.e. zero rated, subject to evidence of export documents kept by the seller. The sales amount should be recorded in Box 6. EC Sales Lists and Intrastat declarations are no longer required.
Sales from Norther Ireland to EU countries will continue to follow the rules for intra-EU trade (i.e. dispatches – sales of goods between EU countries). The sale is zero rated and should be recorded in Box 6 and Box 8. EC Sales Lists will be required and the Intrastat declarations will also be required, subject to the amount of trade.
The sale will normally be zero rated provided certain conditions are met and is recorded in Box 6.
Note 1: Include: exempt supplies and zero rated supplies. Exclude: Insurance claims, loans etc.
Note 2: Exclude wages and salaries, o/s scope VAT items e.g. rates, vehicle licences
Note 3: If annual arrival greater than threshold
Note 4: If annual despatches greater than threshold
Note 5: Except land related and admissions to events. For supplies of services the customer must be in business
Note 6: Except land related and admissions to events
Note 7: Based on C 79 certificate to import VAT paid upfront
Note 8: Based on PIVA statement for postponed import VAT accounting
Note 9: EU sales and purchases relate to trade between Northern Ireland and EU Member States
Note 10: Subject to the normal rules for deducting input tax
Expanding your business into the EU or internationally
Brexit: VAT and Customs - Where is my import VAT?
Changes in Intrastat requirements from 2022