Are businesses facing cashflow problems because of Brexit?
Changes in import VAT are resulting in extra cash flow pressures. Leaving the EU VAT regime means UK businesses will treat EU members as countries outside the EU, as of January 1, 2021.
“UK buyers will be required to pay VAT on goods with a value exceeding £135 at the point of import – a new system that could be detrimental to businesses’ cash flow. For goods valued £135 or less, the VAT will be applied at the point of sale rather than at customs.”
Larger companies are likely to have the resources to manage the cashflow burden, smaller businesses will not have the resources and could find import VAT another headache to have to manage.
An EORI number has also become mandatory for UK businesses to move goods between Great Britain or the Isle of Man, and other countries or could risk facing extra costs and delays.
Corporate structure, supply chains and VAT registration in different countries may need reviewing to ensure your company is as competitive as possible.
What changes have you been forced to make because of Brexit?
#importVAT #imports #exports #brexit
