As the United Kingdom enters the final transition period for Brexit, we are now on the countdown for the impending changes which kick in from 1st January 2021.

We published two posts recently where we reviewed how Brexit will affect 365 Business Central covering both the GDPR and why you consider adding your EORI number to Business Central.

Make sure you’re ready

From 1 January 2021 businesses that deal with Europe will have to follow new rules on exports, imports, tariffs, data and hiring.

If you haven’t done so already, we recommend you visit the Brexit transition webpage on the Government website which you can find here. https://www.gov.uk/transition

Your business, family, and personal circumstances may be affected.

By answering a few questions you’ll get a personalised list of actions to complete, or further guidance for your business around importing and exporting goods.

You can also sign up for emails to get updates on what you need to do.

The landscape is still constantly changing – we recommend you continually check the Government’s advice on how Brexit will affect your business.

Preparing for Brexit – Recommended VAT changes to your ERP system

Every business will have a different approach to the process changes they need to make to stay compliant. Below is a top-level checklist for some of the top tasks you should be actioning now:

  • Update VAT information in your ERP system for each country you import or export to and from.
  • Add new fields to your system templates for sales quotes/invoices/credits notes, packing lists. etc to include EORI number, Country of Origin, and Commodity Codes.
  • From 1 January 2021, you can charge customers VAT at 0% (known as ‘zero rate’) on most goods you export to the EU. Check if you can ZERO rate your goods for VAT.
  • Possible changes required to EU VAT Busines Posting Groups – awaiting government final announcements.
  • Further potential updates for 365 BC include VAT Posting Setups, Chart of Accounts VAT Reports, Item charges, new shipping methods.
  • If you sell goods online into the EU using 3rd parties such as Amazon or eBay, then you need to check their VAT import and export policies too. HMRC issued a notice that declared marketplaces (eg. Amazon, eBay) will become liable for the VAT owed by its third-party sellers. Sellers trading through online marketplaces will no longer be accountable for the VAT.

From 1 January 2021, you’ll need to make customs declarations when exporting goods to the EU. These rules currently apply to exporting goods to the rest of the world, including Switzerland, Norway, Iceland, and Liechtenstein.

You can make the declarations yourself, but most businesses use a courier, freight forwarder, or customs agent.

As a certified Gold Microsoft Dynamics 365 Business Central partner, our team is here to help. Get in touch if you need guidance or changes made to your ERP system.


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Post by Sooz Kinsella

Sooz has worked at the core of innovation in software technology for over 20 years. Her passion lies in delivering great customer journeys and automating processes.