Brexit is here: ecommerce checklist for EU sellers trading with the UK
Brexit has become reality. It will predominantly affect UK sellers trading with the EU, but eBay, Amazon and other marketplace sellers in Europe can expect changes, too.
The latest free trade agreement injected a dose of optimism, yet many rules of the game have changed for UK and European online sellers.
The ecommerce checklist in this article will give EU online sellers tips on how to best prepare for the impact of Brexit on ecommerce and trade across the EU-UK border.
EU online sellers are awaiting the impact of Brexit
As of 1 January 2021 there are border requirements placed on the movement of goods between the EU and UK. There is major change for the movement of goods between Northern Ireland and EU countries, including Ireland.
The UK-EU Free Trade Agreement announced in December 2020 covers trade in goods and services, but also a broad range of other areas, e.g. investment, competition, tax transparency, data protection and so on. The agreement provides for zero tariffs and zero quotas on all goods that comply with the appropriate rules of origin.
With this agreement, tariffs or quotas on goods may be avoided, but problems at the border could still emerge. For example, increasing checks or traders having to complete new customs declarations. In general, commercial relations will face more restrictions and changes, e.g. associated import VAT will be due when the goods arrive in the EU.
Ecommerce checklist for EU sellers trading with the UK
- Ensure you agree on the division of responsibilities with your trading partners in the UK
- Ensure you have the correct paperwork for the type of goods you offer in the UK
- Stay on top of the necessary border requirements
- Check the new customs procedures with your country’s customs authority, for example what customs procedures will be required for bringing goods from the UK to the EU, etc.
- Check the requirements for exporting the type of products you offer, e.g. requirements for exporting food, drink or agricultural products to the UK from the EU
- Check the documents, licences and certificates that are required for the goods you are exporting from the EU into the UK. Learn how to apply for them
- Pre-notify the UK authorities about the goods you are exporting from the EU into the UK
- In the case of manufactured goods, review your product marking, labelling, and packaging. If needed, get additional approvals, certifications or registrations and appoint a legal representative based in the UK
- Make sure you understand the new rules for paying import VAT on parcels you send to UK buyers.
To be on the safe side, consider seeking tax and/or legal advice.
Additionally, as you may need to make some changes to allow you to continue to share personal data with businesses/organisations in the UK, talk to your local data protection regulator to ensure you’re prepared when it comes to matters of data protection and data transfers.
Finally, as changes to EU cross-border copyright mechanisms may impact your business, ensure you have the right permissions starting 1 January 2021.
How to import and export goods between Great Britain and the EU from 1 January 2021
Agreements reached between the United Kingdom of Great Britain and Northern Ireland and the European Union
To get a personalised list of actions for you, your business and your family, use the official Brexit checker.
Brexit and customs & VAT
In the post-Brexit world, businesses in Europe need to make customs declarations and complete the right customs processes when moving goods between the UK and the EU. Otherwise, their goods won’t be able to cross the EU border.
You must pay import VAT on parcels you sell to UK buyers if:
- You’re based outside the UK
- You sell goods sent in parcels worth £135 or less to UK buyers.
If you sell goods sent in parcels worth over £135, the import VAT, customs duty (and excise duty where applicable) should be paid by the UK buyer and collected by the parcel operator.
Learn how to claim VAT refunds on goods and services you buy from the UK.
In case of any doubts, it’s always good to seek legal advice and follow relevant official websites.
VAT changes on eBay
As of 1 January 2021, eBay started to collect and remit VAT for UK imports on all consignments with a value of up to £135. There is no longer a VAT exemption for small consignments up to £15.
eBay has to charge buyers the applicable VAT amount directly and remit this sum to the relevant authorities.
Sellers who trade with UK buyers and list on the UK or any EU site need to provide both gross prices and the applicable VAT rate used to calculate the gross price on all listings.
For this reason, sellers listing on eBay.co.uk or other European eBay sites should specify the applicable VAT rates on existing listings as soon as possible. All new listings should include a VAT rate.
At Webinterpret we’ve been following what Brexit can mean for ecommerce since 2016 when the UK was preparing for the historic referendum. We’ve created numerous guidelines and articles to answer many questions from our sellers and help them navigate the murky waters of the unknown.
We still believe there’s no need to panic. The new reality won’t be easy for all sellers, but cross border trade will carry on: changing trade agreements doesn’t mean cancelling UK-EU trade.
According to Mike Bishop, CEO at Webinterpret:
Commerce and collaboration between the UK, the EU and the rest of the world will continue. It may start off with a period of disruption and a degree of chaos, but it will work in the long-term.
Watch the full interview “How to sell effectively on marketplaces after Brexit” below:
Ecommerce between the UK, the EU and the rest of the world is likely to continue to grow strongly. Webinterpret will also continue to be central to this growth for marketplace sellers. At the same time we will do our best to support international sellers trading across the UK/EU border.
Download our FREE Brexit ecommerce guide!