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News UK has published VAT guide in the event of a no deal Brexit

The UK Government has published a guide summarizing main changes to VAT rules in trade between Great Britain and EU member states in case Great Britain fails to reach a deal with the EU.  


After leaving the EU, the United Kingdom will want to retain its domestic VAT rules in the same form and will strive to keep the current rules on the functioning of VAT to the fullest extent possible. However, the trade with EU member states will be affected significantly:

  • The current rules on imports from third countries will also apply to imports from EU Member States
  • Rules on the shipping of goods within EU will no longer apply, as these shipments will be treated by EU member states as third-country deliveries
  • The export of goods to EU member states will keep being tax exempted with an entitlement for deductions. British exporters will no longer have to fill the EC Sales List; they will be obliged to keep the same records as for exports to third countries instead.
  • Most of the current rules for determining the place of taxable supply when providing services will remain to be applied. The United Kingdom may change the deduction rules in future in case of financial and insurance services.
  • British businesses providing digitals services to customers in the EU member states will be able to continue to use the MOSS payment system (Mini One Stop Shop), however they will have to register under MOSS mode for non-member countries within 10 days after the end of respective calendar month in which the service was provided.
  • British businesses claiming tax refund in other EU member states will no longer be entitled to do so through a simplified procedure for the refund to persons registered to VAT in another member state. From that time on they will be subject to rules valid for third-country businesses
  • Following Brexit, it will no longer be possible to verify the VAT number of British businesses through VIES system; that is why British government is now working on own system to be used in future to verify the validity of British VAT numbers.

 Although Britain’s exit from the EU without reaching any agreement seems quite unlikely due to the mutual interest of both parties to achieve it, it is necessary for the persons and businesses to be prepared for this possibility and minimize the associated business risks.


 Adam Pinďák
Tax Consultant
T +420 296 152 111
E adam.pindak@cz.gt.com