Exporting to the EU

One of the main purposes for the creation of the EU was to improve trade between member states.

There are now 28 nations within the EU, including the UK, all of whom can take advantage of the organisation’s trade regulations for sending and receiving goods and services. Exporting to any country in the EU from the UK is relatively straightforward and using TNT’s international delivery services provides a quick and reliable option.

EU Fact File

  • Currency: Euro
  • Capital City: Brussels 
  • Largest Cities: London and Paris
  • Population: 508 million
  • GDP: $16.449 trillion

VAT

Goods travelling within the EU are in free circulation. Supplying goods to another EU country is referred to as a dispatch, whereas sending to a nation outside of the EU is always an export. All goods sold to EU countries must be recorded on your VAT return and it is therefore essential that your business is VAT registered.

VAT Registered Customer

There is no need to pay VAT when sending goods to a VAT registered customer in any EU country as these will be zero-rated. The receiving party will have to pay VAT at their end but at the equivalent rate as VAT in their country. You will need the receiving party’s VAT registration number for your VAT return and it is vital to retain paperwork with these numbers and evidence that the goods left the UK within certain time limits.

 

Non-VAT Registered Customer

If your customer isn’t VAT registered then you will have to pay VAT at the UK rate on any goods being sent out. The only exemption is when you are responsible for delivering the goods and their value is above the distance selling threshold. In such cases the receiving party must cover the VAT. The same applies if the customer does not provide you with their VAT registration number.

Intrastat

When your sales of goods exceed the applicable exemption threshold in a year, an Intrastat return must be submitted every month. The Intrastat threshold for dispatches is around £250,000 per year. If the value of your dispatches falls below this then you only need to declare the goods in box eight on your VAT return. For anything that goes above this you must also submit Supplementary Declarations (SDs) to HMRC every month.

 

Services

For any services delivered to EU non-business customers you need to charge VAT at UK rates, whereas if you supply services to a business customer there is no need as they are responsible for paying VAT in their country. Certain services have different rules such as hiring transport and restaurant or catering services.

 

Taxes and Duty

Free circulation means all goods produced in the EU can be moved around without any duty being paid. For items that have been produced outside of the EU, but duty has already been paid, then they too do not require any extra duty to be paid.

Excise Duty

Alcoholic drinks, hydrocarbon oils, cigarettes and tobacco produced in the UK are subject to excise duty. This means if you are exporting them to any other EU country you will need to pay the excise tax to HMRC. There are relief schemes where goods can be consigned in duty suspension, which delays the payment by storing in a warehouse.

 

Excise Duty Drawback

Businesses can take advantage of excise duty drawback to suspend duty paid on excise goods moved to other EU countries. This is done by supplying the original duty payment document to HMRC. Or if you did not originally pay the duty additional information may be required, which can be found in Notice 207 of eligibility.

Commodity Codes

Any goods which are not in free circulation but are being exported to an EU country (such as those where duty has not been paid) require a commodity code.

Restrictions and Declarations

An export licence is required for certain goods even when dispatching within the EU.

 

Restrictions

Dispatches of live animals and animal products need a Defra licence, as do ozone-depleting substances. Controlled drugs, medicines, rough diamonds and dangerous chemicals all require the appropriate licence too. Military goods need an export licence to all destinations including EU nations. The commercial documentation must state if such items are controlled if exported outside the EU.

 

Community Transit Declarations

Community transit declarations must be made for goods that were first imported from outside the EU where the duty and import formalities are still pending and are due to be exported. All goods sent to EU special territories such as San Marino and Andorra and EFTA countries require a community transit declaration too.

 

Take a look at TNT’s international export services to start safely shipping your parcels today.