Post brexit import advice required please

No you still charge your customer VAT. Once it’s in the U.K. and you resell it everything is as it always is. It only impacts the process of you buying from a supplier and importing it into the U.K.

Exporting out you will charge the fee without VAT though

As for Import duty there isn’t a simple answer as it’s impacted by a few factors including what exactly it is you are importing. This link on the gov site should be able to help you https://www.gov.uk/trade-tariff

 

If they had to check what imports were coming in for VAT registered companies it would add so much more to the process (and be potentially massively abusable) that it would slow down what is already a slow process to get things through customs (even from EU countries)

And no it won't change just to appease those who like you import from the EU because it would mean having to do it on all imports as this is just what people who import from anywhere else have to put up with

 

Unlikely that the EU is going to be happy managing VAT collection for the UK even with a deal. It would be like expecting the US to handle VAT collection at point of sale for the UK

 

The arrangements are likely to be slightly different if there is a free trade deal negotiated between UK and EU or if we leave with no deal

Deal (assuming it's a comprehensive one!)

Using your Italian example, the goods will be exported to the UK with no VAT or duties since you're VAT registered.
Once they arrive in the UK, VAT will be added to the value of the goods by HMRC.
Duty will not be added since its part of a FT deal.
You can reclaim the VAT on the import if you are VAT registered in the UK through your VAT return
If you sell the goods within the UK, you'll have to charge VAT on the goods and pay that over to HMRC

If you sell/export the goods to another EU country, VAT is not charged in the UK on the exported goods.
In most cases, VAT will be added by the importing country's version of HMRC

No Deal (ie trade between EU and UK is conducted on WTO terms or as the PM likes to call it, an Australian deal)

As for 'Deal', the goods will be exported from the EU with no VAT or duties.
Once they arrive in the UK, VAT will be added to the value of the goods by HMRC
Once in the UK, the volume and standards of the goods will be checked to ensure they meet UK standards and don't breach any quota restrictions on those particular goods
If the goods meet UK standards and quotas, duty will be added by HMRC in line with the UK's duty schedule. (There are thousands of different duty items but the paperwork from the seller should show the goods code to determine which duty is appropriate)
You can reclaim the VAT on the import from HMRC if you are VAT registered in the UK
Duty cannot be reclaimed and you will bear the cost
If you sell the goods in the UK, you'll have to charge VAT on the goods and pay that over to HMRC

If you sell/export goods to another EU country, VAT is not charged in the UK on the exported goods.
Goods which are exported to the EU will have to meet the EU's standards for the goods and any quota restrictions.
In most cases VAT and Duty will be added to the goods when they are imported into the EU by the country's equivalent of HMRC, the local tax authority
You will have to supply information and product type codes for the local tax authorities to determine whether the goods meet their standards, country of origin etc and what duty should be added to the price.

Good luck especially if we finish up without a free trade deal!

 

Couldn't you have started with a simpler issue at the start of the new year!

The theoretical position is that (subject for how you account for VAT), the VAT charged on the invoice is the 'correct' value. That's because the date of the invoice you issued is the tax point. Having effectively pre-accounted for the VAT, that should be the end of it from your perspective. But it won't be!

Your customer will have an invoice from you with VAT on it which is due to you and at the same time if sent DDP after 1 Jan, will more than likely have VAT added when it is imported in the customer's country. The local tax authoritty may expect the customer to pay the VAT at time of import to his local tax authority prior to the goods being delivered. You could be in the worst of both worlds - having to account for the VAT on the invoice you've issued to your customer and not having your invoice paid in full because your customer will believe he's already paid the VAT locally to his tax authority!

I'm not sure whether this is something you can resolve on your own or directly with your customer. My advice would be to ring your local HMRC office and explain the situation and ask for their advice. There might well be some transitional arrangements already agreed to deal with this issue of a transaction spanning two different sets of arrangments. But it illustrates so well how things will still change even with a free trade deal.

Sorry I couldn't be more specific.

 

The fact that your customer has paid is helpful in this situation.You clearly want to do the best for your customer but the issue is really between him and his local tax authority on how they deal with their own VAT. DHL and the other big couriers should be up to speed with the latest arrangments especialy relating to how DDP works after 1 Jan and a chat with them will be useful.

I don't see much of a risk in you having to pay the VAT twice so long as you account properly for the VAT which has already been paid to you by your customer. I still believe that a chat with HMRC is in order since they should know better than anybody how their own administartive system works in this situation.