Frequently Asked Questions
We know companies have plenty of questions regarding Brexit, so we have put together some of the most frequently asked ones below.
We hope the answers below will be useful, however, if you feel you need further support, or have any questions, please do not hesitate to contact our team via firstname.lastname@example.org
Q1. Do all UK companies need to apply for a UK EORI number?
An EORI (Economic Operator Registration and Identification Number) is required if your company is exporting or importing already, or planning to do so in the near future. Once the UK leaves the EU, this will be required to trade with the European Union. Last year HMRC announced that all UK VAT registered businesses have been automatically issued with a UK EORI number. If you are unsure whether you receive one or not, check with HMRC or apply for a EORI number here.
Q2. I am a UK business - Do I need an EU EORI number to trade with the EU?
British businesses will only need to apply for an EU EORI number if:
Selling on a Delivered Duty Paid basis (Incoterms 2020) to EU customers. You will need to apply in the first EU country you are exporting to.
You have a physical EU presence (e.g. sales office, subsidiary, warehousing, manufacturing facility or other) from which you are serving EU customers in any way.
If you are trading with EU Suppliers selling you on DDP basis, they may require to register for an UK EORI number.
Q3. I am currently selling Ex-Works to my EU customers. Will I need to change this to continue trading at the end of the transition period?
No, unless your EU customer(s) wish to re-negotiate the way you currently trade with them. However, we do strongly recommend you use another incoterm such as FCA or similar where you will be able to access proof of exports for your business. If you do decide continue trading ExW, ensure you are keeping evidence of exports.
Q4. Will I have to pay Duties or VAT on my EU imports at the end of the transition period?
If by the end of the transition period the UK and EU have not agreed on the particulars regarding the Withdrawl Agreement, the UK will be subject to trade under the WTO terms, thus, goods coming from the EU into the UK will be subject to VAT. This will be payable at the border for every shipment unless you set up a deferment account which will allow you to make bulk payments for several consignments and pay once a month via direct debit. If you want to know more on how to set up a duty deferment account for your imports, click here
Q5. What additional documentation will I need for exporting and importing to/from the EU?
With or without a deal with the EU and as per recent newly launched UK Border Control Operating Model, UK businesses will need to submit extra documentation when trading with EU customers and/or suppliers, such as Customs Declarations, export health certifications, Sanitary and Phytosanitary Controls, Export Licences and others. Make sure you check the UK Global Tariff which will be operational from the 1st January to ensure you understand all the paperwork involved - both for exports and imports.
Q5.1. We only being trading with the EU and never had to do a Customs Declarations. Can you tell me why we need one now?
As the UK has ben part of the EU Single Market, there was a 'free' movement of goods moving between the EU28 members, and those movements therefore were labeled as 'Dispatchs' and 'Arrivals'. However, as we officially leave the single market, UK exports to the EU or imports from the EU to the UK will be considered with a 3rd country, and thus, this will be treated as exporters and imports subject to customs controls.
If you want to continue trading with the EU, then you must completed export and import declarations from the 1st January 2021, although imports from the EU will have a phased approach during the first 6-months of 2021 allowing UK importers to bring most goods and completing declarations and delaying payment of import duties/VAT during this period.
You can complete the customs declarations yourself via the National Export System or through specialised software connecting your business to CHIEF (Customs Handling of Import and Export Freight), alternatively you can also appoint a third party to do it on your behalf (e.g. freight forwarder, local Chamber of Commerce). Greater Manchester Chamber is a certified Customs Agent and ready to complete these on your behalf. If interested in our services, please exmail for more information
Q5.2. Is there any support from the government to help us with Customs Declarations?
As we leave the EU Single Markets, it is expected the number of customs declarations will go from about 50 million to 250-300 million. The UK Government has therefore been providing funding to businesses and intermediaries to develop the country's capacity to deal with such increase. Funding is available for:
- Recruitment costs for staff who will be directly invovled in completing customs declarations for your business
- Partial cover of salary costs (up to 3 months)
- IT equipment
For more information, please click here
Q5.3. I am interested in training my staff to complete customs declarations. Who offers training?
There is plenty of business intermediary organisations offering training related to Brexit and customs declarations. GM Chamber is one of them offering basic box by box training on customs declarations, however you may also want to check more advanced courses and diplomas offered by the likes of the Institute of Exports and International Trade.
Q6. How can I find out the rate of import duties that will be applicable to my product at the end of the transition period?
If by the end of the transition period (31st Dec 2020), the UK and EU have not finalised the particulars around the Withdrawal agreement, the UK will be treated as a third country by the EU – therefore Third Country Duties will be applied to UK goods. The New UK Global Tariff has been launched offering an indication of the tariffs that may apply to your product(s) from the 1st Jan 2021but please note, these may change if there a deal is finalised before the end of this year, and if the UK signs any further trade deals with other nations.
Q7. Can I still use DDP to sell to the EU after Brexit?
You will still be able to sell DDP to the EU, however, you will need to be more diligent when it comes to import customs in EU territory. You will be responsible for the Import Declaration in the country of destination, and you will need an EU EORI number. You could register for one yourself or ask your EU customer to provide their EU EORI number and the essential information you need to complete their import declaration. You may also need to consider VAT implications and whether you will need to register in the EU country where you are exporting to, or appoint a local agent to manage this on your behalf.
Q8. Do I need to apply for AEO status to continue trading with the EU?
Being AEO (Authorised Economic Operator) certified is not a requirement to trade with the EU after the end of the transition period.
However, having AEO status could make it quicker for your goods to be cleared at customs as your company will be regarded as trustworthy, and that your customs controls and procedures are efficient and compliant. For more information about this, click here
Q9. How do I classify my goods and find out my commodity code?
You can find out your goods commodity code by searching a description of your goods on the UK online Tariff database - it is best to start off with a broader description to initially classify your goods.
If you are struggling to find your code and need a legally binding classification of your goods, you can get a Binding Tariff Information Ruling from HMRC, which would be valid for up to three years.