According to accountancy group UHY Hacker Young, around 20% of SMEs have stopped exporting to the EU since the end of the Brexit transition period on 31 December 2020 to avoid trade costs and paperwork, and that many goods are being sent back due to incorrect or incomplete documentation.
Mike Ryan, chief executive of postal, freight and courier company Pack & Send, offers some advice on the new rules to help Images readers avoid these problems and understand how to start trading in the EU again.
“Now we’ve left the EU, our parcels may be subject to customs fees in some countries, but these will be charged to the recipient, rather than the sender.
“The amount charged will depend on the value of the parcel’s contents. Items valued under €22 won’t be subject to VAT or duties until 1 July 2021 as part of an agreed scheme with the EU – with this date set to be extended.
“Items worth over €22 but below €150 may be taxed at the border and possibly incur a customs handling fee in the receiving country. Those over €150 may attract VAT and customs duties, plus the handling fee. However, these charges will vary from country to country [within the EU].”
For parcels valued over €22, Mike adds: “Customs clearance charges may also be applied to cover the import declaration, handling and processing of each parcel over the course of its shipment. The shipping provider will typically incur these costs and charge them to the sender as part of the total service cost. These charges vary from company to company, but will likely increase based on the size and value of the package and its contents.”
All senders are now required to attach customs documents to any parcel heading to EU countries. Failure to fill these out accurately may result in delayed or returned shipments, incurring additional charges. The document needs to include a commodity code, which can be found at www.gov.uk/trade-tariff.
“When working with a door-to-door shipping service, producing a commercial or pro forma invoice online also reduces the chances of delays in shipment,” says Mike. “This is because they’re scanned directly into the carrier’s system, without running the risk of paperwork getting lost.”
Businesses also need an Economic Operator Registration and Identification (EORI) number to send parcels outside of the UK. You can register for this online at www.gov.uk/eori; without it, you may face increased costs and delays.