Andrew Needham looks at the new system for accounting for VAT on imports from 1 January 2021.
Currently, there are two separate systems for accounting for VAT on goods brought in from outside the UK; one for imports from outside the EU, and another for acquisitions from business in other EU Member States.
From 1 January 2021, there will a new single system for accounting for VAT on imported goods.
Postponed accounting
From that date, there will be a single system for all goods imported into the UK, called ‘postponed accounting’.
Postponed accounting means that the importer does not pay import VAT when the goods arrive at the UK port or airport; it is deferred. The importer instead accounts for VAT at Box 1 of their VAT return. Assuming they can claim
