Brexit

There are just 100 days to go to the end of the Brexit transition period, and the countdown is on. Political leaders across the island of Ireland, UK and the EU are ramping up their engagement on the Brexit front with one common message resounding across the board – Get Brexit Ready now. In today’s bulletin, we bring news of the UK government’s recently published “reasonable worst-case scenario” for borders, as reports emerge that up to 7,000 trucks carrying goods from the UK to the EU could face two-day delays in Dover after the Brexit transition. You can also read about the upcoming meeting of the Joint Committee on the Withdrawal Agreement next week and look back on the recording of the Institute’s Brexit Briefing hosted last week.  UK government outlines “reasonable worst-case scenario” for borders at the end of the transition periodWith recent reports emerging that up to 7,000 trucks carrying goods from the UK to the EU could face two-day delays in Dover after the Brexit transition, the UK government have published their reasonable worst case scenario planning assumptions for potential disruption to UK freight* travelling to the EU at the end of the Brexit transition period. In a statement addressing the House of Commons, UK Cabinet Office Minister Michael Gove  has said that the document has been made available to “illustrate the costs of a lack of preparedness while there is still plenty of time to prepare”.The document says that the planning assumption is that EU Member States will impose EU third country customs controls on UK goods at the end of the transition period. This will mean that all freight that travels to the border without the correct documentation will be stopped before boarding services in the UK or on arrival at Member State ports. This in turn will lead to delays, a strain on resources, and higher costs for hauliers and freight forwarders, which is one of the most significant worries for the logistics sector at the moment. There are also reports of both Irish and UK haulier groups being concerned about the potential increase in prices of goods due to post-Brexit delays. The document predicts that only 30 – 60 per cent trucks would arrive at the border with the necessary formalities completed for the goods on board. The document also highlights a worrying estimate where only 50 – 70 per cent of large businesses, and just 20 – 40 per cent of SMEs, would be ready for the new EU requirements that will come into effect starting 1 January 2021. Readers can also register for Revenue’s upcoming series of live streamed Brexit information sessions on customs and movement of goods taking place on 5 and 6 October 2020.  *refers to goods transported in bulk by truck, train, ship, or aircraft Political leaders across the island of Ireland urge businesses to get Brexit ready nowTánaiste and Minister for Enterprise, Trade and Employment, Leo Varadkar TD is urging businesses to be ready for the inevitable changes that Brexit will mean for their operations at the end of the transition period on 31 December 2020. As a part of the “Getting Ireland Brexit Ready” campaign, the Tánaiste is calling on businesses to take particular action in the areas of customs, supply chain vulnerabilities, cash flow planning, and certifications. In his statement, the Tánaiste has said, “I ask all businesses regardless of their size, small, medium or large to focus on their Brexit readiness as things will simply not be the same. Being prepared for customs formalities is critical and the Government is here to help.”Additionally, Northern Ireland Economy Minister Diane Dodds is also encouraging businesses across Northern Ireland to access EU Exit support from Invest Northern Ireland and InterTrade Ireland, which include online Brexit tools, webinars and EU Exit support vouchers. In her statement, Minister Dodds has addressed the need for clarity around trading requirements for Northern Ireland businesses, however has stated that “there are things that businesses can do now to ensure they are equipped to face the challenges and opportunities from 1 January 2021.”Readers can find further supports by clicking on the following links:Government of Ireland Brexit HubInvestNI EU Exit Hub Joint Committee on Withdrawal Agreement to meet on Monday next weekWhen is the meeting?The EU and the UK have agreed to hold the next meeting of the Joint Committee on the Withdrawal Agreement on Monday, 28 September 2020, in Brussels.  Who is attending?The meeting will be co-chaired by the UK Cabinet Office Minister Michael Gove and Vice President of the European Commission, Maroš Šefčovič. Representatives from the Northern Ireland Executive are also present as a part of the UK delegation.  What are they discussing?The full agenda of the meeting can be found here. The agenda also features a discussion on the Protocol on Ireland/Northern Ireland.   Video supports for UK businesses trading with the EUThe UK government have released a series of videos to help prepare businesses for the new trading requirements coming into effect starting 1 January 2021, irrespective of the outcome of the Brexit negotiations. The videos discuss the key elements such as: export goods to the EUimport goods from the EUprepare your business to continue to move people, data and services between the UK and the EUBrexit Bites Members can now look back on our live webinar, “Brexit Briefing – Is your business ready for 2021” via our YouTube link. The webinar covers important guidance in the areas of customs, cross-border trade, and services.Sign up for LEO Workshops: Prepare Your Business for Brexit Customs For all Brexit updates, visit our Brexit webpage. 

Sep 24, 2020
Brexit

HMRC has ramped up Brexit preparedness as they issue letters to VAT-registered businesses in Great Britain trading with the EU. In today’s bulletin, read about the essential measures to adopt now if you are a Great Britain based trader, conducting business with the EU. Additionally, you can read about the new ESRI paper that compares the impact of COVID-19 and Brexit on different sector of the Irish economy. HMRC issues letters to VAT-registered businesses in Great BritainHMRC has sent out letters VAT-registered businesses in Great Britain trading with the EU. These letters highlight the steps to take to prepare for new post-Brexit trading requirements, coming into effect starting 1 January 2021. A copy of the letter can be found here.The letters explain what businesses need to do to prepare for new processes for moving goods between Great Britain and the EU, and highlight practical steps to prepare including: Registering for a UK Economic Operator Registration and Identification (EORI) numberDeciding how to make customs declarationsCheck if import VAT is due at the borderCheck the government’s tariff tables and consider how your trade will be affectedChecking eligibility of imported goods for staged import controlsSign up for the Trader Support Service , if you move goods between Great Britain and Northern Ireland or bring goods into Northern Ireland from outside the UKThese requirements will be necessary irrespective of the outcome of the negotiations between the EU and the UK. Businesses can find more information on HMRC’s website or in the letter linked to above.  “COVID-19 and Brexit impact different parts of the economy”, states latest ESRI researchWith the Irish economy struggling to cope with the adverse impact of COVID-19, latest research says that a no-deal Brexit on top of the pandemic will be catastrophic for businesses. The latest research released by the Economic and Social Research Institute (ESRI) and the Department of Finance also shows that there is limited overlap between the sectors at risk from a hard Brexit and those currently being most impacted by COVID-19. The paper examines sectoral impacts from COVID-19 and Brexit individually, and then analyses the overlap in sectoral impact from both. No sector was found to be in a category of severely exposed to both the Brexit and COVID-19 shocks. However, there are a few sectors that could be severely impacted by one but moderately impacted by the other. Sectors impacted by COVID-19 Sectors impacted by Brexit Wholesale and Retail TradeAccommodationFood ServicesConstructionIndustry Financial ServicesAgricultureFoodTraditional manufacturing  The research also notes that the ranking of risk exposure is at a sector level and that impacts on individual firms may differ from this.   Brexit BitesRead the ESRI’s latest research on Northern Ireland inputs to Republic of Ireland EU FTA (free trade agreement) exports commissioned by the Northern Ireland Department of the EconomyUK clinches historic trade deal with Japan. Worth £15.2 billion, the agreement is UK’s first major post-Brexit trade dealThe UK government have published their latest Customs, VAT and Excise UK transition legislation coming into effect from 1 January 2021  For all Brexit updates, visit our Brexit webpage. 

Sep 21, 2020
Brexit

“Get Brexit Ready Now” is the message that comes across loud and clear in recent guidance issued by Revenue and HMRC. In today’s bulletin, take a look at Revenue’s new Brexit readiness programme and the launch of their new customs declarations system set to kick in November 2020. HMRC have also issued Brexit preparedness letters to VAT-registered businesses in Great Britain trading with the EU. Additionally, you can read about the new ESRI paper that compares the impact of COVID-19 and Brexit on different sector of the Irish economy.  Revenue writes to 90,000 businesses to Get Brexit Ready NowRevenue confirmed that it is in the process of sending letters to 90,000 businesses, as part of an intensified programme of engagement on Brexit readiness. The letters emphasise the importance of being Brexit ready come 1 January 2021 and outlines steps to follow to do so. Revenue are encouraging businesses to get ready now, as the reality of Brexit looms. Revenue’s latest press statement says that starting this week, Revenue have been sending the letters to businesses that are expected to be adversely impacted by Brexit in the Republic of Ireland. The letters set out the critical Brexit preparation steps businesses need to take now. Revenue have made available the checklist and readiness article for our members to access as well.  Revenue have also published updated guidance and key information on their dedicated Brexit section, where readers can find information on popular topics such as, registering for An Economic Operators Registration And Identification (EORI) number, payment of import duty, VRT Implications of trade with the UK post-Brexit. Lynda Slattery, Head of Revenue’s Brexit Policy Unit has commented saying “Revenue is urging all businesses that will be impacted by Brexit to get ready now. Business that have any Brexit Customs queries that are not answered by the material available on the Revenue website can email enquiries to brexitqueries@revenue.ie or contact 01-7383632 to discuss Brexit preparations.” Readers can also register for Revenue’s upcoming series of live streamed Brexit information sessions taking place on 5 and 6 October 2020.   Revenue launches new customs declarations system for imports from outside the EUFrom November 2020, Revenue will implement a new import system, called the “Automated Import System (AIS)”. This new system will be introduced to comply with the provisions of the Union Customs Code (UCC), and will ensure that businesses can import goods legally from outside the EU (including the UK) using the most efficient process possible.What will change?This system will replace the existing Automated Entry Processing (AEP) system, and eManifest systems for imports. One of the most major changes under this will be the change in the format of customs import declarations. The import Single Administrative Document (SAD), currently processed within the AEP system, will be replaced by new AIS declaration types. What will not change?Securing an Economic Operators Registration and Identification (EORI) number continues to be of the utmost importance for traders if they wish to import goods into the EU. Exports will continue to be managed through the AEP system until 2023. However, from November 2020 onwards, if you import and export goods from and to the EU, you must use:AIS for your import declarations, andAEP for your export declarations.Businesses are urged to prepare for this change by making sure their customs software is up to date. Further information on preparing for this change can be found on Revenue’s website.  HMRC issues letters to VAT-registered businesses in Great BritainHMRC has sent out letters VAT-registered businesses in Great Britain trading with the EU. These letters highlight the steps to take to prepare for new post-Brexit trading requirements, coming into effect starting 1 January 2021. A copy of the letter can be found here.The letters explain what businesses need to do to prepare for new processes for moving goods between Great Britain and the EU, and highlight practical steps to prepare including: Registering for a UK Economic Operator Registration and Identification (EORI) numberDeciding how to make customs declarationsCheck if import VAT is due at the borderCheck the government’s tariff tables and consider how your trade will be affectedChecking eligibility of imported goods for staged import controlsSign up for the Trader Support Service , if you move goods between Great Britain and Northern Ireland or bring goods into Northern Ireland from outside the UKThese requirements will be necessary irrespective of the outcome of the negotiations between the EU and the UK. Businesses can find more information on HMRC’s website or in the letter linked to above.  “COVID-19 and Brexit impact different parts of the economy”, states latest ESRI researchWith the Irish economy struggling to cope with the adverse impact of COVID-19, latest research says that a no-deal Brexit on top of the pandemic will be catastrophic for businesses. The latest research released by the Economic and Social Research Institute (ESRI) and the Department of Finance also shows that there is limited overlap between the sectors at risk from a hard Brexit and those currently being most impacted by COVID-19. The paper examines sectoral impacts from COVID-19 and Brexit individually, and then analyses the overlap in sectoral impact from both. No sector was found to be in a category of severely exposed to both the Brexit and COVID-19 shocks. However, there are a few sectors that could be severely impacted by one but moderately impacted by the other. Sectors impacted by COVID-19 Sectors impacted by Brexit Wholesale and Retail TradeAccommodationFood ServicesConstructionIndustry Financial ServicesAgricultureFoodTraditional manufacturing  The research also notes that the ranking of risk exposure is at a sector level and that impacts on individual firms may differ from this.   Brexit Bites Read the ESRI’s latest research on Northern Ireland inputs to Republic of Ireland EU FTA (free trade agreement) exports commissioned by the Northern Ireland Department of the EconomyUK clinches historic trade deal with Japan. Worth £15.2 billion, the agreement is UK’s first major post-Brexit trade dealThe UK government have published their latest Customs, VAT and Excise UK transition legislation coming into effect from 1 January 2021  For all Brexit updates, visit our Brexit webpage. 

Sep 17, 2020
Brexit

“Get Brexit Ready Now” is the message that comes across loud and clear in recent guidance issued by the Irish Government. In today’s bulletin, read the Institute’s practical steps to help businesses across the island to get ready, read more about the launch of Revenue’s new customs declarations system, set to kick in November 2020. You can also read about the Irish Government’s new Brexit Readiness Action Plan. Prepare for no-deal Brexit immediately, say Chartered Accountants Ireland With all the uncertainty surrounding the Brexit negotiations, one thing businesses can be sure of; come 1 January 2021, the trading environment will be vastly different than the simplicity offered by the current EU Single Market. In a press statement released by the Institute, businesses on the island of Ireland are being warned that given the lack of progress in Brexit negotiations, they have no option but to assume the EU and the UK will fail to reach agreement by the end of the year and to prepare accordingly.  We have outlined eight practical measures that businesses on the island of Ireland should adopt now:Register online with HMRC or Revenue for an EORI number – you cannot trade without one.Contact your suppliers and logistics providers about the continuity of goods and services you need for trade.Check if your non-UK suppliers use the UK as a land-bridge and ascertain whether this will cost and cause delaysClassify the goods that you import or export for customs duties and know their originSeek out a customs agent or enhance in house customs knowledgeEnsure that you have a line of credit to deal with the customs duties that will arise on imports from the UK or Ireland.Check whether your current certifications, licences or authorisations will be valid post-Brexit.Use the Government supports available. You can read more about the press coverage of this statement in our “In the Media” section of the newsletter.Revenue launches new customs declarations system for imports from outside the EUFrom November 2020, Revenue will implement a new import system, called the “Automated Import System (AIS)”. This new system will be introduced to comply with the provisions of the Union Customs Code (UCC), and will ensure that businesses can import goods legally from outside the EU (including the UK) using the most efficient process possible.What will change?This system will replace the existing Automated Entry Processing (AEP) system, and eManifest systems for imports. One of the most major changes under this will be the change in the format of customs import declarations. The import Single Administrative Document (SAD), currently processed within the AEP system, will be replaced by new AIS declaration types. What will not change?Securing an Economic Operators Registration and Identification (EORI) number continues to be of the utmost importance for traders if they wish to import goods into the EU. Exports will continue to be managed through the AEP system until 2023. However, from November 2020 onwards, if you import and export goods from and to the EU, you must use:AIS for your import declarationsandAEP for your export declarations. Businesses are urged to prepare for this change by making sure their customs software is up to date. Further information on preparing for this change can be found on Revenue’s website. Irish Government launches Brexit Readiness Action PlanThe Irish Government has launched the Brexit Readiness Action Plan, that sets out the steps that businesses and individuals need to take now to be ready for the end of the Transition Period on 31 December 2020. The Bill covers readiness measures at Governmental Level, and in key areas such as trade in goods, trade in services, connectivity, transport and north-south & east-west relations.The Government has also published the General Scheme of the 2020 Brexit Omnibus Bill which is intended to address a wide range of complex issues that arise post transition period. The Bill will be considered by the Houses of the Oireachtas later this term and the tax sections of the Bill are discussed in the Irish Tax News section of this bulletin.What is the Internal Market Bill, and why is it important?As reported first by the Financial Times, the UK government has released their widely discussed Internal Market Bill, which has gained quite a bit of traction lately as the legislation that will “eliminate the legal force of parts of the Withdrawal Agreement" in areas such as State aid and the new customs arrangements for Northern Ireland. The UK Internal Market Bill (explanatory notes) is draft legislation on how the UK wants to manage trade within its borders and territories after Brexit. This Bill has caused major frenzy last week as it essentially “rewrites” parts of the Withdrawal Agreement signed between the EU and the UK. The Bill covers key negotiation areas such as State aid, unfettered access to goods, spending power and devolution. However, two aspects of the Bill that affect Northern Ireland have caused much debate and commentary – State aid and customs. The Bill seeks to eliminate customs arrangements in Northern Ireland which could compromise the ability to avoid a hard border on the island of Ireland. The Bill would also give unilateral power to the UK government to change or disapply export rules for goods travelling from Great Britain to Northern Ireland.  If implemented, this Bill would suggest that the EU would have little ability to influence State aid rules in the UK.  The UK government want to change rules to set aside EU law and ECJ law on State aid. Article 10 of the NI protocol sets out that EU State aid rules will apply in certain cases where relevant to trade in goods and electricity between Northern Ireland and the EU.  The UK government is seeking to override this and instead ensure a uniform approach across the UK to the application of EU State aid law under the Protocol. The Internal Market Bill is undergoing its second reading in the House of Commons today. It’s implementation will be subject to debate and approval by both chambers of the UK parliament before it becomes law. The UK is however aiming to pass this Bill before the transition period deadline expires on 31 December 2020. What about the Withdrawal Agreement? The Withdrawal Agreement as it is currently written says that the UK must notify the EU of any State aid decisions that would affect Northern Ireland’s goods market. It also says that special customs arrangements apply in Northern Ireland to protect the EU market. If implemented, the draft Bill would be in clear breach of several provisions contained within the Protocol on Ireland/Northern Ireland not least the good faith provisions. The EU have stated that the Bill is in defiance of the stated aim of the Bill, which is ultimately to protect the Good Friday (Belfast) AgreementInternational reactionsIn a statement following the “extraordinary” meeting of the EU – UK Joint Committee, Maros Sefcovic, the EU Vice President in charge of overseeing the implementation of the divorce deal released a hard-hitting statement which calls on the UK government to withdraw the conflicting measures from the draft Bill in by the end of the month at the latest. They have also concluded the statement by indirectly warning the UK government of the possibility of legal action as per the mechanisms and legal remedies in place in the Withdrawal Agreement to address violations of legal actions. US Speaker of the House, Nancy Pelosi has also released a statement on Brexit & a potential US – UK trade agreement, stating that “if the UK violates that international treaty and Brexit undermines the Good Friday accord, there will be absolutely no chance of a US – UK trade agreement passing the (US) Congress”. For all Brexit updates, visit our Brexit webpage. 

Sep 14, 2020
Tax RoI

Amendments to income tax, capital tax, corporation tax and stamp duty legislation are reflected in Part 8 of the new Brexit Omnibus Bill.  These measures aim to ensure continuity of reliefs and allowances, as well as the retention of anti-avoidance provisions, in the aftermath of the transition period. The Bill also provides for the introduction of postponed accounting for VAT to alleviate cash flow impacts for business, and anti-avoidance amendments to Section 56 VAT relief authorisations. This new Brexit Omnibus Bill provides legislation to underpin the Government’s readiness measures at the end of the transition period. The Bill is intended to be consistent with and complementary to the steps underway at EU level to prepare for the UK’s withdrawal. The Bill may be updated or adjusted further in light of ongoing developments, including developments in Future Partnership Negotiations, any EU legislative measures which may be agreed, and any additional measures taken collectively by the EU27 Member States, including Ireland.

Sep 14, 2020
Tax RoI

In November 2020, Revenue will implement a new national import system, called the “Automated Import System (AIS)”. This new system will comply with the provisions of the EU’s Union Customs Code (UCC), and will ensure that businesses can import goods legally from outside the EU (including the UK) using the most efficient process possible.  Read today’s Brexit Bulletin to find out more. 

Sep 14, 2020