Deal or No Deal? That is still a question!

Despite the UK stepping out of the EU on 31st Jan 2020, we did not see any real impact on the movement of people as well as goods to and from the EU. And today, when we are less than 3 weeks away from the real Brexit, we still don’t know exactly what the impact will be. “Deal or No Deal?” is still a question and negotiations between the UK and EU are likely to carry on to the last minute.

During this time of uncertainty, no matter what the outcome will be, one thing is certain… Mercurius IT is prepared to help UK and EU customers deal with any changes required in their Microsoft Dynamics NAV or Dynamics 365 Business Central ERP Systems.

Microsoft’s current statement on this subject is as follows:

Using Business Central after the United Kingdom Has Left the European Union
(dated 01/10/2020)

The departure of the United Kingdom (UK) from the European Union (EU), impacts many businesses operating inside and across UK borders. With final negotiations still pending, we do not foresee any required Microsoft Business Central product changes. However, as a user of Business Central, your organisation should expect to make configuration changes. Business Central is a highly configurable business application and has many settings related to VAT processes, which is the area that will most likely be impacted. You may want to start preparing for changes in legislation, such as keeping track of VAT rules. We recommend that you pay specific attention to the potential VAT impact as a result of international negotiations and British legislation, making sure to fully post open documents before changing your VAT setup. Please engage your Business Central reselling partner for assistance.

We are posting a series of blogs to help declutter the subject and provide useful information for businesses who import and export goods from the EU.

As many of you already know, the most important page to book-mark is the UK Government’s webpage:
Import, export and customs for businesses: detailed information.

Have you got an EORI Number yet?
EORI: Economic Operators Registration and Identification
Today, you need an EORI number just to move goods between the UK and non-EU countries. From 1st January 2021 you will need one to move goods between Great Britain (England, Scotland and Wales) or the Isle of Man, and the EU. You may also need a separate EORI number if you move goods to or from Northern Ireland.

If you do not have an EORI, you may experience increased costs and delays. For example, if HM Revenue and Customs (HMRC) cannot clear your goods you may have to pay storage fees.

Potential System Change

  • Dynamics 365 Business Central: Microsoft will add EORI Field on Company Information that partners can use and add at relevant places elsewhere in the system as needed.
  • Dynamics NAV: Mercurius IT can help you with this change.

Importing goods into UK:

  • Rules will now apply to all countries outside of the UK
  • Reverse Charge in place for B2B for all goods imported
  • Check gov.uk for UK Trade Tariff changes
  • Possible changes required in Dynamics NAV/ D365 Business Central ERP:
    – EU VAT Business Posting Groups
    – VAT Posting Setups
    – Chart of Accounts
    – VAT Statements
    – Item charges
    – New shipping methods
    – Tariff Numbers
  • Special Documentation for livestock, food and plant products required

Exporting goods to EU:

  • Customer Declarations are required
  • Potential Zero Rate VAT to all EU Countries
  • Possible changes required in Dynamics NAV/ D365 Business Central ERP:
    – EU VAT Business Posting Groups
    – VAT Posting Setups
    – VAT Statements
  • Special licenses required for some type of goods

Goods from Northern Ireland (NI) to UK Mainland (GB):

  • As things stand, there will be no additional process, paperwork, or restrictions on NI goods moving to GB
  • Trade from NI to GB continues as it does now

Goods from UK Mainland (GB) to Northern Ireland (NI):

  • As things stand, there will be some changes for goods movement, but kept to a minimum
  • Food and agricultural products; Sanitary and Phytosanitary products
  • UK authorities apply EU customs rules to these goods entering NI
  • New administrative process for traders, notably new electronic import declaration requirements

Watch this space for more details on the impact of Brexit!

Feel free to contact us if you need any help or guidance: info@mercuriusit.com OR jay.t@mercuriusit.com

Jay Tahasildar, Mercurius IT: https://www.linkedin.com/in/jay-tahasildar-697955/