No Deal Brexit – How would it affect VAT?

With negotiations still under way on the impending Brexit, there is a lot of uncertainty around whether the UK will leave the EU without a deal.  This may not affect most companies on the Isle of Man but if you run a company that currently trades with the EU, you will need to ensure that you are prepared for this scenario.

Firstly, you must register your Economic Operator Registration and Identification (EORI) number at

You will be responsible for making your own customs declarations of goods traded with the EU. You may want to hire an agent to make these declarations for you and you should think about putting this in place as soon as possible.

If you decide to make the declarations yourself, you will need to purchase software that interacts with HMRC’s systems.  For those deciding not to use an agent, HMRC have introduced transitional simplified procedures (TSP) for customs to reduce the amount of information you need to provide when importing good.  More information on this can be found at

For anyone deciding not to use an agent, it is advised that you ensure that the effects of a no deal are understood and there is the necessary expertise within the business to be compliant with the new procedures.

VAT – What’s different?

EU’s VAT number validation service (VIES) – From 29 March 2019 Isle of Man and UK VAT numbers will no longer appear in this service.  Instead you will only be able to check these VAT numbers on the Isle of Man Governments VAT checker, which will be available from 29 March 2019.  

UK VAT Mini One Stop Shop (MOSS) – You will not be able to use MOSS on sales of digital services made after 29 March 2019. You need to register for MOSS in each EU member state where you make sales by 10 April 2019.

Once the UK leaves the EU, the annual threshold for cross border sales will no longer be available and so all supplies will become liable to VAT.

EU VAT refund electronic system – The usual deadline of 30 September 2019 for making EUR VAT refund claims for 2018 must be submitted before 29 March 2019. Any VAT reclaims after the UK leaves the EU will be made via the authorities in the country where your business is based who will then pass your claim to the authorities in the other country.

Importing goods – Rather than paying import VAT when the goods arrive at the UK border, you will be able to account for import VAT on your VAT return.

There will be more articles to follow once further information is available on the effects that a Brexit no deal will have so keep following us to keep up to date.

Invicta Accounting Ltd recognise that with the Brexit no deal situation there is a lot to think about and can be confusing.  Let Invicta take this stress off your hands – give us a call today on 01624 672358 to see what we can do for you.