Delivery to EU – VAT, Customs and other charges

Since 1st January 2021, the UK has no longer been a member of the EU. This means that deliveries to EU countries are now subject to the receiving EU country’s rules and regulations for purchases from outside the EU. This is similar to what has always been the case for buying goods from, say, USA.

The EU has further changed its regulations from 1st July 2021, bringing more, smaller purchases within their VAT regulations and making them subject to charges.

The effect of this is that buyers of UK goods may now have to pay VAT, Customs duties and a handling charge imposed by the buyer’s country’s postal service. Previously, none of these charges would have been applicable. Goods passing through the buyer’s country’s Customs in this way may also be delivered more slowly.

There is a new mechanism – the EU VAT One Stop Shop (OSS) – that is intended to let sellers from outside the EU charge VAT according to the rates in the buyer’s country when goods are purchased. This requires the seller to store and charge different VAT rates for each country they are selling to in the EU. There are other bureaucratic steps necessary, as well as modifying websites, to enable this.

An alternative is for the UK seller to have an agent/distributor in any EU country, from whom all EU purchases would be made by buyers. As this would be inside the EU, external charges would not apply, although the buyer’s country’s VAT rate probably would apply.

Helion is investigating both of the above options – OSS and an EU distributor – but it will take some time to get any arrangements put in place. There are currently substantial delays in getting the OSS set up, both on the UK and EU sides, and an agent/distributor is a long-term business partnership that cannot be put in place overnight. As a relatively small business, Helion does not have the resources to focus purely on this issue in the short term.

Quite a lot of UK sellers have ceased supplying to EU countries altogether. Helion does not intend to do this, but buyers should be aware that their own country may well charge them VAT, Customs duties and a handling fee from now on for purchases from Helion.

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