Brexit Bulletin, 21 October 2019

Oct 21, 2019

The past week has seen a significant amount of development in the realm of Brexit. While the UK government and the EU agreed upon a draft Brexit deal last Thursday, the deal is yet to be ratified. Read a summary of the developments so far.

The Brexit deal explained

Following two days of intensive negotiations, a Brexit deal was agreed upon last week between the UK government and the EU. Here’s a summary of the commercial elements of the deal which has yet to be passed by the parliaments of both the UK and the EU:

Customs arrangements

On the issue of customs, Northern Ireland will remain part of the UK’s customs territory. Goods entering Northern Ireland from Great Britain will be checked to ensure EU rules are maintained and duties charged if the goods are at risk of subsequently being moved into the EU.

Where goods remain in Northern Ireland or re-enter the rest of the UK, traders in Northern Ireland could claim back the difference, in the form of a rebate of the duties paid. If products are transported on from the Northern Ireland to Ireland, or other parts of the EU, no rebate could be claimed.

VAT

The issue of how Value-Added Tax (VAT) will be applied in Northern Ireland after Brexit was one of the last holdups in the negotiations for a deal.  EU rules on VAT and excise duties will apply in Northern Ireland, with the UK authorities responsible for their collection. The UK may apply VAT exemptions and reduced rates applicable in Ireland to supplies of goods moving across the island of Ireland by way of derogations.

The Protocol states that they, “intend to mutually recognise the trusted traders' programmes, administrative cooperation in customs and VAT matters and mutual assistance, including for the recovery of claims related to taxes and duties”.


UK Parliament passes Letwin amendment
 

Upon reconvening on Saturday, the UK House of Commons voted in favour of the Letwin amendment, which enables the UK to withhold approval for the Brexit deal, until legislation to implement the deal has been passed by the government.

UK Prime Minister requests extension to Brexit deadline

The UK Prime Minister has officially requested a further extension from the EU to the Brexit deadline until the end of January 2020. This is in line with the terms of the “Benn Act” passed last month to ensure that the UK government does not leave the EU without a deal. The EU is currently considering the extension, with the consent of all EU27 member states required to grant it.

However, if the EU refuses to grant the UK a delay to Brexit, then the UK Parliament has until 31 October to pass a deal and the associated legislation. The UK Parliament is set to reconvene later today to put forward the legislation required to ratify the draft Brexit deal.

 

Brexit preparedness resources

Guidance video: Single Administrative Document

Chartered Accountants Ireland has released a quick guidance video on how to fill out the Single Administrative Document, which will be a requirement for making customs declarations post-Brexit by both Irish/UK traders to trade with the UK/EU respectively. Visit our Customs page to watch the video.

Avail of Customs Transit Procedure

The Minister for Business, Enterprise and Innovation, Heather Humphreys is urging businesses to make sure they are prepared well in advance to avail of the Customs Transit Procedure for moving goods through the UK land bridge post-Brexit. The Customs Transit Procedure removes the requirement for businesses who are transiting goods through a non-EU country to pay duties and complete customs declarations when they enter the country and again when they leave it to re-enter the EU.

Businesses will require two things in particular to avail of the Customs Transit Procedure:

  • A Revenue-authorised Comprehensive Guarantee, covering transit through third countries, which the UK will be post-Brexit
  • To avail of the Transit element of that guarantee, a business must also have in place a financial guarantee from a bank, where the Department’s Credit Guarantee Scheme can be used by business to back their financial guarantee from a bank.

Read more on the procedure here.

Brexit Customs Level 1 and 2 – CPD course

Chartered Accountants Ireland, in association with the Irish Exporters Association, has launched a brand new continuous professional development (CPD) course - Brexit Customs Level 1 and 2 in both the Republic of Ireland and Northern Ireland.

This course provides participants with insights into how to manage their dealings with EU/International customs efficiently and explores areas such as goods classification, origin, valuation and transit. 

Interested parties can visit the CPD Brexit programmes page of our website to learn more and register for the upcoming course in Cork.

HMRC – Customs funding

The UK government have announced additional funding to support businesses with the costs of making customs declarations. Businesses based in, or with a branch in, the UK can apply for funding ahead of the UK leaving the EU. Grants can be used to support:

  • training costs for businesses who complete customs declarations, or who intend to in the future
  • funding for IT improvement, which is available to small and medium sized employers who are currently involved in trade as an intermediary

Applications can be made online, with the grant being offered within 30 days of applying. 

Irish Government Brexit Supports

The Department of Business, Enterprise and Innovation have released several Brexit preparedness supports, including the Brexit preparedness checklist, the Brexit Loan Scheme and the Getting Business Brexit Ready guide. For the full range of supports for businesses, visit the Department’s website.

Read all our updates in our Brexit web centre and our page dedicated to no-deal Brexit planning.