2020 has been a year full of several challenges for small businesses. The coronavirus pandemic has left many small businesses vulnerable. With serval businesses looking to bounce back, there is now the impending Brexit to contend with.
The United Kingdom will leave the Single Market on 31st December 2020. When it does so, it will also leave the European Union’s VAT regime. It will no longer be bound to European Union principles.
If you are a business in the UK, and you are selling goods both in the United Kingdom and to a country within the European Union, you will have to be compliant with local rules.
Post-Brexit tax changes
From January 1st 2021 onwards, businesses will face a potential risk of paying VAT upfront for each cross-border transaction that occurs. VAT-registered companies in the United Kingdom will be able to account for import VAT on their standard VAT Return forms. According to the official guidance, the main ‘place of supply’ rules will remain unaffected.
How much the current processes will change will be dependent on whether the United Kingdom gets a trade deal and what that might entail when agreed.
If you have any questions about how Brexit could potentially affect your business. Contact us by phone on 01473 744 700 or send us an email firstname.lastname@example.org, and we will be more than happy to help.