Brexit and Amazon – What does the British exit from the European Union mean for retailers?

Kamil Kempisty
Updated: 25 March 2021

On Friday, January 31, 2020, at 11:00 p.m. British time (i.e. at midnight in Poland), after 47 years, the United Kingdom ceased to be a member of the European Union. From the very beginning, Brexit in the British Isles was associated with a single word – “chaos.” Sellers of their goods on Amazon should know the possible consequences of the British exit from the European Union.

Today, Brexit has cost Great Britain 83 billion pounds, or 489.7 billion PLN. This is 440 million pounds per week and 727 pounds per second. These figures are frightening, but what does leaving the EU mean for those selling their goods on Amazon? No-Deal Brexit was fortunately avoided. The Exit Agreement, under which the UK is parting with the European Union, guarantees the start of a transition period. This period starts on February 1, 2020. It will last until the end of 2020 and secures the continuation of current relations between the European Union and the United Kingdom. The United Kingdom will continue to be treated as a member of the Union but will not have a say in the EU decision-making process. Brexit is concerned about the entire e-commerce industry, whether it operates in the UK and sends its products abroad or sells goods in the UK. Everything remains the same at the moment. If your goods are in Amazon’s warehouse in the UK, all your local orders will continue to be processed there without change. The same is true if you store in France, Spain, Germany or Italy and send goods to the UK. However, if the futures contract is not finalised and does not enter into force as of January 1, 2021, which coincides with the end of the transition period – then we will face consequences similar to not signing the contract and leaving the Union on a “No-Deal” basis. This would involve a change in VAT settlement rules, a change in the rules for collecting excise duty and a change in customs rates to those currently in force for non-EU countries. We should keep our hand on the pulse and observe the situation, and count on the United Kingdom to reach a final agreement with the European Union. The earlier this happens, the better. Taxology intends to keep a close watch on further developments. We will keep you informed about all the changes, further decisions and possible consequences for people and companies selling their goods on Amazon in subsequent articles. As of today, the situation for 2020 remains unchanged. What will it look like in 2021 – for now it remains one big unknown. If you have not found the answers to your questions here, contact us. We help many online retailers in Europe with the issues of VAT registration and settlement.

0 0 vote
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

See also

22 January 2021

What VAT applies in Spain?

IVA, short for “Impuesto sobre el Valor Añadido,” is the equivalent of VAT in Poland. VAT has been in force in Spain since 1986, when Spain joined the European Union. The basic VAT rate in Spain is 21% and covers all products and services that are not covered by the reduced rates of 10% and 4% and the zero rate.
Podstawowa stawka VAT w Hiszpanii wynosi 21% i obejmuje wszystkie produkty i usługi, których nie obejmuje stawki zmniejszone równe 10% i 4% oraz stawka zerowa.

11 December 2020

VAT after Brexit

From January 1st, 2021 Great Britain will no longer be part of the European Union VAT regime. As a consequence, the rules of taxation and documentation of deliveries of goods transported from the territory of the European Union will change. The United Kingdom will also introduce new rules for VAT settlements of sales through marketplaces […]

12 November 2020

VAT in Poland

The Value Added Tax was introduced in Poland in 1993 but since then regulations were amended many times. Currently, VAT in Poland is a part of the European common system of Value Added Tax. The standard VAT rate in Poland is 23% since 2011. There are reduced rates of 8% and 5% on certain food, books, newspapers and some other services.

23 October 2020

Distance selling thresholds in EU

In recent years, e-commerce sales have been growing very dynamically, which can be seen on the example of the Amazon platform. If selling online, there are also tax issues related to VAT reporting in different countries.

14 August 2020

When should I register for VAT on sales on Amazon?

When should I register for VAT in another country? Do I have to register for VAT abroad? I have exceeded my mail order limit and what now? Can I voluntarily register for VAT in another country? When you sell your goods abroad, questions start to arise about where to pay VAT and when I need […]

2 March 2020

Amazon.pl? Amazon in Poland in 2020

Amazon will launch its service in Poland by the end of 2020, according to “Gazeta Wyborcza.” Amazon.pl can change a lot on the Polish e-commerce market. It is said that the Polish Post Office has undergone qualitative tests and it is this institution that will deal with the delivery of Amazon products

facebook-icon twitter-icon linkedin-icon comments-icon facebook