What are the Implications on Vat of a ‘No-Deal’ for Brexit?

Earlier this month HM Revenue & Customs published a report “Vat for businesses if there is no Brexit Deal”.

The current situation is that there are 4 freedoms guaranteed by membership of the EU, free movement of goods, services, capital and labour.  This has been the position since January 1993.

What would happen if we had a ‘no deal’ position as we exit the EU?

UK Vat on Exports to the EU

Currently no Vat is collected on sales to other EU businesses.

In a ‘no deal’ situation, we would revert back to the pre-1973 situation. Formal procedures would be introduced, sales to EU countries will be subject to EU vat.

Vat Imports from the EU into the UK

Imports in a ‘No Deal’ situation would again mean that we would revert back a formal procedures.  The situation is likely to be similar to the current rules for imports from Non EU countries.

Ctrl/Click on the link below for more information,

www.icaew.com/en/technical/tax/tax-faculty/taxguides/taxguide-2117-tax-implications-of-brexit