Exporting Essentials: Customs, VAT & Licensing

Webinar posted by William Barns-Graham, on behalf of Open to Export

This Open to Export webinar discusses these key issues necessary to export such as the export licensing process, the organisations and requirements and the customs procedures. Speakers include Ray Ward from HM Revenues & Customs, John Griffiths, Business Advisor with HM Revenue & Customs and Mike Josypenko the Director of Special Projects for the Institute of Export.

Here are some bullet points:

Export licences exist in order to oversee, control or prevent the sale and importation of certain goods.

The Products which need licences include military equipment, technology, torture or civilian repression products and radioactive products. Each one of these products is subject to licences from different authorities.

There are three types of licences, OGEL (Open General Export Licence), SIEL (Single Individual Export Licence) and OIEL (Open Individual Export Licence).

In order to sell goods to the EU you must get the customer’s VAT number, send the goods to EU within 3 months of the date of supply and show the VAT number on the sales invoice.

ESL stands for the EC sales list which shows your customer’s country, customer’s VAT number, the indicator number and the value of goods you have sold them.

Intrastat is a system for gathering information and generating statistics on trade goods between countries within the European Union.

Economic Operator Registration and Identification (EORI) includes all businesses involved in Customs related activities and the identification number recognised by all EU Member States.

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Questions & Answers

As usual there were some excellent questions, some of the questions and the responses have been noted down.

If you have a particular product and want to find out if you need a licence where can you go for clarification? (48:35)

If you are in any doubt call a help line, you can also check the Export Control Contact List, the Dual Control List (and all the various subdivisions) and the military list.

Whose duty is it to get the licences, can you get it on behalf of the person doing the exporting? (50:10)

There are regulations for those who act as brokers, to be safe you should go to the gov. site for an overview of the export controls.

In regards to a bundled price, in which they sell a product and a service (to install product) as an extra, how does this work? (51.39)

Usually the agreement between exporter and customer agree that goods will be supplied in an installed state therefore there is no need to quote an installation price, VAT can be applied to a Bundle Price and therefore there is no need to differentiate between the price.

If your enterprise is based in the UK and your goods are being made outside the EU and then being exported somewhere without returning to the UK, is VAT required? (53:12)

VAT is only required when good pass over the threshold of the EU, for example if goods are made in china and exported to the US but the invoice is from the UK, the UK business is not required to pay VAT.

How do you deal with VAT when an export client collects the goods from the UK? (57:35)

If a non-EU citizen buys the goods with the intention of taking them back to his/her country, you can find details in the retail export scheme. However if a customer picks up your goods but you do not know where he is taking them, it is recommended to take a VAT deposit until he/she can provide evidence.