08/03/2019
Are you Brexit ready?
IF you are a small business owner are you Brexit ready? Accountant Rob O'Hara has useful advice for anyone who recently got a letter from Revenue on importing and exporting after a no-deal Brexit.
BREXIT: What Irish businesses need to know about imports and exports ahead of March 29th.
I would guess at this stage most Sole Traders and Small Companies received correspondence from Revenue regarding Brexit.
When we see the harp symbol on the top of a letter we can start to panic or worry that the Revenue are looking to take more of our hard earned money away from us. However in this instance the purpose of the letter is to deal with the effect of Brexit and the effect on trade between Ireland and the UK.
In the letter, Revenue referenced an EORI (Economic Operators Registration and Identification) number, and provided information but that can leave us feeling confused and, just like Teresa May, with no idea as to what is going on re Brexit.
To help a little I am going to explain why Revenue sent this letter and what does this all means.
Firstly if you do not trade nor ever intend to trade with the UK then you can neatly fold the letter up and file it under “A” for “Arrivederci. If you do trade with the UK, then you need to read on.
If the UK leaves the EU without a deal, it will mean that the UK will become what is known as a 3rd Country, and, as a result Revenue will be introducing new procedures for Irish sole traders and companies who trade with the UK after the 29th March 2019. To put it this in simple terms, a no-deal Brexit will result in Irish businesses needing to declare on exported or imported goods to Customs. This is really not as scary as it may sound and I’ll explain a little more later on.
If the UK leaves the EU with a deal a place on the 29th of March 2019 no changes will come into effect until the 1st January 2021, at which time a new trade agreement is to be put in place.
A question that I keep being asked is: “Can I still trade with the UK after a no-deal Brexit?”
The answer is yes you can still trade, but the UK will be outside the EU and there will be new rules for exporting or importing goods with the UK. To trade, you will need the aforementioned EORI number. (This EORI can be applied through ROS (Revenue Online Service) if you haven’t yet received it.)
Here is the legal bit, but again don’t be put off by the terminology, as this is standard stuff and hopefully won’t impact your business too much even if there is a no deal Brexit.
Two new rules for importing from the UK if a no-deal Brexit occurs after 29th of March.
1. An Irish business must complete a customs declaration electronically before the goods arrive in Ireland.
2. Revenue will carry out a risk analysis on imported goods. They will check if the goods need a physical exam, a document check, or if they can be released.
Now this bit is important to note. VAT and customs charges will apply to all imported goods. At the present time legislation is being drafted which will allow business to pay the VAT on imports in their following VAT returns
Revenue may allow a deferral of payment of these charges but there must be what’s a called a” comprehensive guarantee” in place. To do this a business will need authorisation from Revenue.
If this authorisation is received a business can make payment on the 15th of the following month.
New Rules Exporting Goods to The UK After A No Deal Brexit:
If an Irish business is exporting goods to the UK, you will also need to complete a customs declaration electronically.
However, VAT and custom charges will not apply on exported goods unless you have agreed with your customer that you will pay these fees.
In conclusion then, the letter from Revenue was to alert all businesses that, in the case of a no-deal Brexit, and you want to trade or continue to trade with UK can you apply for an EORI number off their website, before March 29th.
If you have any queries regarding this or would like help with registering for your EORI than please contact Rob O’Hara on [email protected]
Rob O’Hara (ACCA) is an accountant.
