Details on how Brexit affects customs and VAT when shipping internationally.
After a number of extensions, the UK left the European Union on 31st January 2020. A transition agreement was made, running until 31st December 2020, with new rules coming into effect on 1st January 2021. During this period, the UK and EU have been negotiating a trade deal. However, for UK ecommerce retailers selling to European consumers, there are implications for both importing and exporting goods whether a deal is struck or not.
Our team has been working hard to ensure that all ShipStation users selling into Europe can structure and store product data correctly, store company and tax registration data, and automatically create the required customs documentation.
These changes affect three areas:
-
Customs
-
VAT
-
Carriers and Fulfilment Providers
The Customs and VAT topics are discussed in more detail below. Check back to this article frequently in the coming weeks as we will update it with any new information as it becomes available.
For details on the Carrier and Fulfilment Provider changes, please review the new How does Brexit affect carriers and fulfilment providers? article.
ShipStation Legacy vs New Layout
ShipStation will be making updates to the capabilities around customs and VAT in the new ShipStation layout only. ShipStation Legacy will not include these updates. If you would like to use the new features and are currently using ShipStation Legacy, you must switch to the new layout.
The change in customs borders will impact rules and restrictions, tax and duty rates, and the import/export documentation required.
An Economic Operators Registration and Identification (EORI) number is required to ship goods from the UK beginning 1 January, 2021. If you haven’t already, you must register for an EORI number.
-
If you’re located in Great Britain, you should receive an EORI number that starts with GB.
-
If you’re moving goods to Northern Ireland or from Northern Ireland to any non-EU country (including GB), you need an additional EORI that starts with XI. You may want to register for the Trader Support Service that will assist you with all the changes.
-
Goods moving from Northern Ireland to and from the Republic of Ireland and the EU are treated as EU “intra-community” and not subject to duties.
-
Goods moving between Northern Ireland and Great Britain are treated as domestic shipments, despite requiring customs information.
Important
If you’re shipping to an EU business, you need to provide the EORI number of the recipient on the commercial invoice!
Use the chart below to see which EORI number is necessary when shipping goods. 3rd Country is defined as any country outside of the EU and the UK.
|
To GB |
To NI |
To EU |
To 3rd Country |
|
|---|---|---|---|---|
|
From GB |
Domestic |
XI EORI (Domestic) |
GB EORI* (conditional EU EORI) |
|
|
From NI |
XI EORI (Domestic) |
Domestic |
Intra-Community |
|
|
From EU |
Intra-Community |
Intra-Community |
EU EORI |
* In the event of a no-deal Brexit, an EU EORI may not be required even if you’re over the destination country's threshold.
Make sure to review the EORI numbers above regarding a second EORI number starting with XI.
Post Brexit, Northern Ireland will remain a member of the EU Customs Union but will also remain part of the UK’s customs for goods only.
From GB to NI
Tariffs and duties should not be required for goods coming from Great Britain that are destined for Northern Ireland.
You will be required to provide Harmonized System Codes (HS Codes) with your declarations. HS Codes that are inaccurate can lead to delays, fees, and inaccurate charges.
Beware that while HS Codes are recognised internationally, more specific categories differ by country. You should use an HS Code search that targets the UK.
Use the following resources to look up your appropriate codes:
When you fill out your customs declaration inside ShipStation, we send that information to the shipping provider (if they are able to accept it). The provider then uses this information to generate the commercial invoice (and sometimes declaration forms) necessary to facilitate getting your shipment through the customs agencies.
In some cases, like with DHL Express, we generate a commercial invoice as a PDF on your behalf and upload it to the DHL Express system.
Some carriers do not accept electronic trade documents or generate commercial invoices for you. In these cases, we will provide you with our generated version of the commercial invoice. This invoice should be printed out in triplicate and included inside your shipment.
CN22 and CN23 forms are only required for international postal shipments. Previously, these were not required for shipments to the EU, but will be after 31 December, 2020.
Review the Postal Service Customs Forms page to learn more about these types of forms.
Tip
A CN23 can be substituted for a CN22, but not the other way around.
While both of these documents contain similar information, a commercial invoice also details the agreement between the shipper and receiver. This includes who’s responsible for the shipment a well as the duties and taxes (and whether or not they’ve already been paid).
To learn how to print customs forms in ShipStation, review the Print Customs Forms article on our help center.
ShipStation already provides the ability to add customs declarations to your shipments. You can find more information in the Adding Customs Declarations in ShipStation help article.
Additionally, a phone number or email for the buyer (also known as the consignee) is required. You may update this information in the Recipient information for your orders, if it is not already present.
COMING SOON! If shipping to a business, ShipStation will soon have the ability to add the VAT number for your recipient. This may speed up the customs clearance process.
There are some changes to the treatment of VAT and tax when trading with consumers in the EU member states and your obligations will change starting 1st January 2021.
Based on the value of goods sold in specific member states in the EU, you may be required to register for a VAT number in the member country. We recommend using Avalara’s free VAT Risk Assessment tool to find out.
For many carriers, ShipStation supports Delivered Duty Paid (DDP). When a shipment is shipped as DDP, the shipper is responsible for paying the taxes associated with the shipment. Please review our DDP FAQ for a list of carriers that support the DDP option in ShipStation.
Delivered Duty Unpaid (DDU) or Delivered at Place (DAP) works in the opposite way. In this scenario, the shipper is responsible for the transportation costs but is not responsible for paying the taxes associated with this shipment. Customs agents will use the contact information provided on the invoice and customs declarations to settle the charges with the recipient.
Many marketplaces, including Amazon and eBay, will be collecting duties and taxes upfront from buyers for shipments that will originate in the UK and have a EU27 destination. You will need to send these goods as DDP.
You can now add your tax identifiers (VAT ID, EORI, IOSS, etc) to your International Settings. These tax ID numbers can then be added to the shipments that require them so they will print on the shipment's associated commercial invoices or customs forms.
Learn which carriers support IOSS, and
Updates affect ShipStation's new layout only!
The option to add your tax identifiers in ShipStation will not apply to ShipStation Legacy. If you would like to use these new features and are currently using ShipStation Legacy, you must switch to the new layout first.
To add your Tax ID numbers to your ShipStation account:
-
Click the Add a Tax Identifier button.
-
Select the Tax ID type and Issuing Authority, then enter the ID number and give it a nickname (the nickname helps you identify the ID when selecting it for your shipments).
Available Tax ID Types:
-
TIN
TIN is a generic "Tax ID Number". Use this option if your Tax ID type is otherwise not provided in the list.
-
VOEC (Norway)
-
PAN (India)
-
EIN
-
SSN
-
VAT
-
EORI
-
IOSS
Obtain your IOSS numbers
If you need your IOSS number, contact your selling channels to request this information. If you do not use the IOSS, your customers WILL pay the VAT upon delivery.
-
-
Click Save Tax Identifier.
-
Click + Add Another Tax Identifier to add additional Tax ID numbers.
Repeat until you have added all necessary Tax ID numbers to ShipStation.
ShipStation's will display a list of the Tax Identifiers that have been added. The Tax ID details cannot be modified once added. If you need to make a change to an entry, you must delete the entry and add a new one.
Once you've added your Tax IDs into the International Settings, they will be available to add to your international shipments.
Add Tax IDs to Orders Automatically
You can also add your Tax Identifier to orders via Automation Rules. See our Example Rules for a demonstration.
Your shipment now includes the Tax ID. ShipStation will include this data when requesting the label and customs documentation from the carrier.
Your Tax IDs will also appear in the Customs Declarations section of your Shipment Details after the label has been created: