As a ChannelUnity customer involved in marketplace selling, you’ve most likely had to deal with the implications of Brexit already.  Whilst a fair amount has been written on the subject, the truth is that Brexit is only half the story.   

Further changes are on their way, in the shape of the EU Marketplace VAT reforms due in July 2021.  This might be the last thing you want to hear right now but these reforms ought to restore the competitiveness of UK sellers shipping into the EU.  It’s only to be hoped that EU customers don’t lose faith with UK sellers in the meantime.  Whatever the outcome is, we strongly recommend you consider the changes well ahead of time. 

In this article, we’re not going to cover the details of shipping from the UK mainland into Northern Ireland.   That seems to be a whole other story and we’ve tried to keep things brief.  

First let’s review the Brexit changes themselves. Since 1st January 2021, the old rules on distance selling are gone. You can no longer have sales up to 35,000 EUR in France and pay no VAT, with various similar limits in other EU countries.  Also gone is the exemption for items up to 22.50 euro which attracted no VAT in any event.  

Going forwards, to ship goods from the UK into the EU, it’s more complicated: 

• You need to register with HMRC for an EORI number, which takes a few days. 
• Every package you send needs a customs declaration on the outside of the package, stating the customs terms used for the export.  Normally these ‘Incoterms’ are DDP (Delivered Duty Paid), where you, the seller, pay the VAT, or DAP (Delivered At Place), where the customer pays.     
• If you’re shipping DAP, your parcel carrier will contact your customer and ask them for the local import charges before releasing the goods to them.   They’ll also charge them an admin fee.   (A friend of ours in the Netherlands recently paid 39 euros of taxes and charges to DPD before they’d release an item bought from a UK seller on Etsy for £79).
• If you’re shipping DDP, you’ll pay the local import charges to the tax authorities yourself, either by registering for VAT in each country you sell to, or by using an agent to handle that for you. You will also require an EU EORI number.  Using ChannelUnity to list on multiple, local country Amazons, for example, you could add the VAT uplift into Listing Settings, to calculate a VAT-inclusive sales price for that channel. But, you’d still have to unwrap the transaction in your shopping cart, or order management system, separating the VAT out again. 
• You also need to bear in mind that goods which are not of UK/EU origin will attract duty on import into the EU – so, if you’re selling goods manufactured in China or the States, for example, beware of that. 
• Finally, you need to consider what happens with returns.  Customers will almost always ship return items back to you DAP, meaning you’ll have to pick up the UK import charges bill when they arrive.  For this reason, some ChannelUnity customers are using return agents like ZigZag or Rebound to manage returns inside the EU. 
• Because of the complexities, certain ChannelUnity customers have already established warehouses inside the EU, and the Netherlands seems to be favourite.  Reports are that working with the Dutch authorities is fairly simple, straightforward, and well automated