In this month’s round up of VAT cases, Graham Elliott considers VAT on imports after 1 January 2021, the end of the retail export scheme, undisclosed partnerships, roof insulation and Covid-19 payment holidays
Imports from 1 January 2021
HMRC has published a substantial policy paper, Changes of VAT Treatment of Overseas Goods sold to Customers from 1 January 2021, which unveils the replacement to current procedures relating to imports of low value items into the UK.
The low value relief (£15) will be removed. All goods brought into the UK on sale will be subject to UK VAT. A special scheme will apply to goods of £135 value or lower, which will cause the VAT to be declarable by the market platform through which they are sold, or, if no such platform is involved, the vendor, as a UK sale. This will replace VAT charged at import. This will, of course, apply equally to goods arriving from the EU.
The paper has details concerning the timing of the introduction in respect of goods sold before they are shipped (where the former occurs prior to 2021 and the latter occurs in 2021). It also outlines relevant procedures.
