Brexit and the implementation period ― overview

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Brexit and the implementation period ― overview
  • How does Brexit affect UK VAT and customs law?
  • What happens during the implementation period?
  • What happens to Northern Ireland and Ireland after the implementation period ends?
  • What areas are likely to be particularly affected after the implementation period ends?

This guidance note considers issues that businesses need to consider in connection with Brexit and the implementation period.

The UK has negotiated a Withdrawal Agreement with the European Union and left on 31 January 2020 (subject to a transition / implementation period).

New Withdrawal Agreement and Political Declaration ; EU(W)A 2018, s 1

Much uncertainty still remains for VAT and customs as to how the Withdrawal Agreement will be implemented (especially in relation to Ireland and Northern Ireland) but this guidance note seeks to provide an overview of some of the key points that businesses need to be aware of.

House of Commons Briefing Paper (October 2019) 
How does Brexit affect UK VAT and customs law?

A lot of the rules around VAT and customs in the UK are either derived from EU law or are EU laws which have ‘direct effect’ in the UK. The UK must also respect case law judgments made by the Court of Justice of the European Union (CJEU).

At the end of the implementation period (which is described below), the legal position will change significantly and, broadly speaking, EU law which has direct effect will cease to have effect in the UK, and decisions of the CJEU will no longer be binding on the UK. UK law which has been derived from EU law (like VATA 1994) will continue to apply but will need to be modified in some areas and over time will be able to diverge further from the EU position.

EU(W)A 2018, s 1

Technically, the UK has made p

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