Customs and VAT implications of the UK leaving the European Union

The European Commission has published a paper setting out the detailed customs and VAT implications of the UK leaving the European Union Withdrawal of the United Kingdom and EU rules in the field of Customs and Indirect Taxation

The EC paper covers much the same ground as the ICAEW Tax Faculty TAXguide 21/17 the tax implications of Brexit but is shorter.

There are a few issues covered in the EC note that are not in the TAXguide, particularly the Authorised Economic Operator. The EC document states:

“Authorisations granting the status of Authorised Economic Operator (AEO) and other authorisations for customs simplifications, issued by the customs authorities of the United Kingdom will no longer be valid in the customs territory of the Union [after Brexit].”

The EC document also states that

“Taxable persons wishing to use one of the special schemes of Chapter 6 of Title XII of the VAT Directive (the so-called Mini One-Stop Shop or MOSS), who supply telecommunications services, broadcasting services or electronic services to non-taxable persons in the EU, will have to be registered for the MOSS in a Member State of the EU.”.

The published paper appears to represent the stance that will be taken by the EC if no progress is made with the Brexit negotiations.  We hope that the end result will be less of a burden on UK businesses.