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VAT amendments for EU exit

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The government has laid regulations making various changes to four statutory instruments and revoking one order, from a day to be appointed in the event that the UK leaves the EU without a deal.

Changes made by The Value Added Tax (Miscellaneous Amendments, Revocation and Transitional Provisions) (EU Exit) Regulations, SI 2019/513, include:

  • ensuring partial-exemption special methods agreed before EU exit in relation to supplies of financial services will continue under the new rules;
  • a transitional provision allowing EU VAT refund system claims to be dealt with after exit;
  • allowing existing legislation on European Research Infrastructure Consortia to be retained with consequential amendments, meaning that TCTA 2018, Sch 8 Para 94(9) and SI 2019/59, art 89 will not now be commenced;
  • extending for a two-year period the recipient’s joint and several liability for import VAT on certain postal packets;
  • a nine-month transitional period for UK fulfilment houses who import goods from the EU to obtain HMRC approval; and
  • a power to make provision in a public notice for collection of VAT from certain businesses using transitional simplified procedures.

The four statutory instruments amended are:

  • The Value Added Tax Regulations, SI 1995/2518;
  • The VAT (Relief for European Research Infrastructure Consortia) Order, SI 2012/2907;
  • The VAT (Postal Packets and Amendment) (EU Exit) Regulations, SI 2018/1376; and
  • The Fulfilment Businesses Regulations, SI 2018/326.

The VAT (Special Accounting Schemes) (Supplies of Electronic, Telecommunication and Broadcasting Services) Order, SI 2018/1194, which introduced a €10,000 threshold for application of home country VAT rules to supplies of digital services, will no longer be relevant to UK businesses after EU exit and is revoked.

Issue: 1435
Categories: News