5 Post-Brexit Trade Myths busted

5 Myths on Post-Brexit Trade with the EU

Is your business one of the 47% UK businesses whose sales and revenue have been impacted due to reduced or complete halt to trading with the EU? Despite EU being the biggest trading partner for the UK, the value of UK goods exported to the EU in Post-Brexit trade fell by 45% between December ‘20 and January ‘21.

GFS and SimplyVAT.com debunk some of the biggest myths and misconceptions that are standing in the way of qualified businesses rebooting sales with the EU and widening their market share. 

5 Myths on Post-Brexit Trade

Myth #1: Post-Brexit Trade with EU countries is Complicated 

The Import One Stop Shop (IOSS) was launched in July 2021 to simplify online selling for ecommerce businesses shipping to the EU, but many businesses who qualify for this service are still hesitant to reconnect their trade ties. VAT collection and reporting for sales to all 27 EU countries can be simplified by registering in just one EU member state, sparing you the pressure of creating multiple VAT declarations for each country. 

Myth #2: IOSS makes Cross-Border Selling Expensive

On the contrary, for any business sending parcels to the EU, IOSS is the most cost-effective approach to send parcels, as it takes away the hassle and cost of paying differing fees per parcel based on the handling fee of the receiving country, value, and nature of each item. ‍It also eliminates any ‘surprise costs’ as customers have visibility on exactly how much they are being charged including VAT. 

Myth #3: Border Clearance is a Hassle Post-Brexit

Once your business is IOSS registered, custom declarations and cross-border shipping can be made paperless, which makes it less prone to errors and unexpected customs charges, delivering your goods across to customers faster across all EU member states.

Myth #4: Your Business has to deal with an Increased Workload

Under the new rules, an IOSS intermediary is normally required for non-EU businesses. This intermediary is accountable to sort out your IOSS registration and submit your returns. Also getting a delivery partner onboard to handle cross-border shipping means you can focus purely on internal operations and selling, leaving the rest with the intermediary partners.

Myth #5: Handling VAT = Headache

After charging the due VAT on checkout at the point of sale, businesses using IOSS will be able to ship the goods VAT-exempt into the EU. As VAT would have already been collected at the point of sale by the seller, the parcel will be customs-cleared without VAT being due upon importation. A monthly IOSS return and VAT payment will be due to remit the VAT collected from EU consumers.

Quick Understanding of IOSS

Expanding your ecommerce business to the EU can be done in a simple, cost-effective, and fuss-free way — you just need to understand how. 

Shipping experts, GFS have partnered with VAT experts, SimplyVAT.com, to cut through the noise and explain in ‘plain speak’ what this means, with step-by-step guidance on how to get started. Join their experts for a quick rundown on how to restart sales to the EU and expand your market reach to a whole new level in their Reboot EU Sales for Your Business masterclass on Thursday the 5th of May 2021 at 11:00am UK.

1 likes2 dislikes

Comments

If only this was true - The actual reality is that these are not Myths but actual fact. Even with the IOSS scheme - trying to sell to Europe IS complicated, IS expensive, IS a hassle, IS a massively increased workload and CERTAINLY is a headache. Every one of these I can certify are not myths. Only in theory does the IOSS scheme work well. The reality is that some countries refuse to recognise it properly. Some countries only recognise it with some tariff codes and not others, despite that not being the way it should work. Some countries only recognise it on parcels arriving by Mail, and NOT by courier. Basically, despite the IOSS scheme being simple, every EU country has it's own interpretation of it, meaning it is massively complex to understand where you can ship without issues, what courier will be OK to use without issues, what tariff codes they will accept, and if they will tag on any other surprise fees. Meanwhile, whilst the EU has full customs controls in place, the UK continues to keep the borders wide open allowing unscrupulous companies based abroad to send goods to UK customers, pretend they are sent using the equivalent of our IOSS scheme, and no questions asked by our customs - the goods roll in tax free, giving international companies a 20% advantage that we don't have. Basically we have cut ourselves off from being able to access the European market, but left the doors wide open for European companies to access UK consumers. Its just so damaging. Brexit benefits just give and give....

Sam • 29th April 2022 •

Agree with Sam. It isn't straightforward and for a small business the associated costs are just too great.

Stephen • 3rd May 2022 •

"Fuss free way" LOL You are joking. Every part of the process is difficult, time consuming, and more expensive than before. And having to pay an Intermediary when you only see products in the £10 to £30 range kills it completely. Also Amazon insist you must have an address in Europe where customers can send returns, can't be sent directly back to the UK, so that would be a return postage cost to whoever you were paying to receive your return in Europe, then a further postage cost to send the item back here, meaning it would be more cost effective to just let the customer keep the item and give him all his money back! The only way I am "rebooting my EU sales" is through Amazon now they have suddenly found a way for all my UK FBA items to be buyable by EU customers again.

rob whitfield • 3rd May 2022 •

Another helpful Intermediary and yet another cost. Pre Brexitshambles I was doing nearly all my trade into the EU via Mirakl Marketplaces and did not even need eBay or Amazon even our website was getting business. We are completely overpriced now and as other sellers are saying IOSS is a mess. I have a lot of family and friends over in Ireland (which is overpriced for everything) and they no longer buy from UK sellers but German ones (AN post love a good customs charge at the door)....Now everyone is skinto your left with a UK market that is saturated and our useless Government still leave the doors open for EU biz to export into the UK. It could not actually get worse.

SAM • 3rd May 2022 •

We are all set up for IOSS and it works well although it was painful to set up and the monthly returns are another layer of admin and cost we dont need but it is do-able. The big problem is that EU customers are have lost confidence in buying from UK as many have had to pay import charges or had problems with returns so its safer for them to buy in Europe now. We have seen EU business drop between 20 & 50% depending on country and running at around 40% down overall....

Jon • 3rd May 2022 •

Hi Jon, I've stopped selling to the EU at present except via ebay Global Shipping Programme. What kind of items do you sell and what are the costs involved? Who do you ship with and do you send DDP? I would consider setting it up for my own website if costs are not to bad.

Rob • 3rd May 2022 •

I'm copying Sam's statement because it's 100% correct From the coalface, Brexit is a total and utter disaster for SME's that import / export and B2C exports from the UK to the EU are pretty much dead If only this was true - The actual reality is that these are not Myths but actual fact. Even with the IOSS scheme - trying to sell to Europe IS complicated, IS expensive, IS a hassle, IS a massively increased workload and CERTAINLY is a headache. Every one of these I can certify are not myths. Only in theory does the IOSS scheme work well. The reality is that some countries refuse to recognise it properly. Some countries only recognise it with some tariff codes and not others, despite that not being the way it should work. Some countries only recognise it on parcels arriving by Mail, and NOT by courier. Basically, despite the IOSS scheme being simple, every EU country has it's own interpretation of it, meaning it is massively complex to understand where you can ship without issues, what courier will be OK to use without issues, what tariff codes they will accept, and if they will tag on any other surprise fees. Meanwhile, whilst the EU has full customs controls in place, the UK continues to keep the borders wide open allowing unscrupulous companies based abroad to send goods to UK customers, pretend they are sent using the equivalent of our IOSS scheme, and no questions asked by our customs - the goods roll in tax free, giving international companies a 20% advantage that we don't have. Basically we have cut ourselves off from being able to access the European market, but left the doors wide open for European companies to access UK consumers. Its just so damaging. Brexit benefits just give and give....

Noel • 4th May 2022 •

@Tamebay @Chanellx Where have you got this garbage from. Come and spend a day here at @deutscheparts and I'll show you the real world. It's this patronising rubbish that I do NOT want on the new improved ChannelX For your info, the UK is not registered for IOSS and probably never will be able to (more Brexit), so please tell me how setting up a new company in an EU country and then submitting VAT returns in that country is EASY ? Worst article you've ever posted, I'd take it down if I were you

Noel • 4th May 2022 •

Patronising rubbish. That's Tamebay for ya. Sounds more and more like a government/big tech propaganda outlet every day.

Mike • 4th May 2022 •

I agree Mike, I used to enjoy reading this site - but it is just corporate rubbish these days. I cannot remember the last time an article really got me interested.

Darren • 9th May 2022 •

Is this ad a joke? This has obviously been written by someone who has ZERO practical experience of exporting to the EU after Brexit. Because our corrupt government has chosen not to sign a VAT agreement with the EU, registering for IOSS is impossible unless you have a fiscal representative. Stop promoting garbage and help real small businesses that are struggling.

Anna • 8th May 2022 •