The negotiators of the European Union and the United Kingdom Government published a statement on the progress of negotiations under Article 50 TEU on the United Kingdom’s orderly withdrawal from the European Union on June 19, 2018, which included several announcements relevant for VAT. The joint statement is putting forward with a view to the meeting of the European Council (Article 50) of 29 June 2018.
The cornerstones relevant for VAT are as follows:
- The EU VAT regime will remain in place for the UK even after the Brexit transition period up until December 31, 2020 including all rights and obligations with reciprocity between taxable persons in the EU member states and the UK.
- The access to the IT-Systems regarding the “VAT Information Exchange System” (VIES) between the EU member states and the UK will be limited until 31. December 2024.
- The “Mini One-Stop-Shop” (MOSS) simplifications between the EU member states and the UK will end 31. December 2020.
- The access to the IT-Systems in regards to MOSS will be limited until 31. December 2024.
- Input VAT claim applications between the EU member states and the UK will be forwarded until April 30, 2021 and should be completed until January 31, 2022.
- The competent VAT authorities will cooperate in matters of VAT fraud until 31. December 2024.
From a VAT point of view, the strict deadline of 31. December 2020 for the UK leaving the EU VAT regime will challenge companies situated in the UK as well as in the EU member states to stay compliant when doing ongoing business with each other.
The fact that certain IT-Systems will be accessible for a certain grace period subsequently should be welcomed.
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Bildquelle: Rolf Krekeler / pixelio.de