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Ivor Feerick
A key area for many Irish businesses will be the impact of VAT and the effects that may arise as a result of Brexit. The system of cross-border transactions was directly affected as of 1 January 2021. Invoicing and reporting has changed with regard to supply chain in particular, cross-border and with transactions between Ireland and the U.K. This may result in a cash flow cost and also increased administration and compliance costs for Irish companies trading with the U.K.
The likely VAT effects of Brexit on the supply of goods to and from the EU may also include:
For example, a Vendor arranges transport of the goods. Registration thresholds exist for each EU Member State with a view to discouraging cross border purchases by consumers based on lower VAT rates in Member States in which supplier is based. Supplies will need to register for VAT in the UK or alternatively customers will be liable for import VAT and duty.
Brexit will result in additional costs, bureaucracy and lead times. It is very important for Irish businesses to minimise the impact on their business.