I’m well aware that businesses in Northern Ireland have been negotiating challenges post-Brexit when it comes to trade arrangements. Let’s face it – selling to EU member states has long been a tricky issue for businesses when it comes to EU VAT thresholds and rules around VAT registration.
It may appear that the NI protocol, which keeps Northern Ireland aligned with the EU single market for goods, will see businesses grapple with new trade complications between Great Britain and Northern Ireland, such as increased customs checks and shipping costs, along with supply chain issues.
Ross Boyd Chartered Accountants
Our take at Ross Boyd Chartered Accountants is that there is a silver lining. Brexit presents a unique VAT opportunity for Northern Ireland’s existing small and medium-sized enterprises, or indeed, those that may be interested in establishing themselves here. Granted some trading complications between Great Britain and Northern Ireland will remain, but the opportunity lies in the EU VAT rules introduced on 1 July 2021. An opportunity that small businesses are yet to take full advantage of OSS, commonly known as the One Stop Shop.
To explain in short, the process of selling goods to the EU states has been simplified for businesses that fall under the Northern Ireland protocol, meaning these businesses have been considered part of the EU for VAT purposes.
The introduction of new simplifications such as the One Stop Shop can save local businesses valuable time and effort when it comes to reporting VAT on distance selling. The One Stop Shop (OSS) VAT return for ecommerce simply requires a single EU VAT return which simplifies the overall VAT filing process and replaces the obligation for EU cross-border sellers to VAT register in each country where the business is selling goods.
SMEs are the backbone of Northern Ireland’s economy and by mitigating this administrative burden, the One Stop Shop could boost productivity and profit within these businesses. This could in turn, boost the local economy and help drive ecommerce development throughout Northern Ireland.
SMEs across Northern Ireland have been hit hard by the pandemic and by the withdrawal of government support measures. Survival is definitely key in this competitive marketplace. Businesses must be agile and adapt at rapid pace which leads us to some interesting conclusions.
SMEs need to be proactive. Businesses should begin by establishing and integrating the relevant infrastructure. SMEs should get in touch with industry experts who can easily guide them through the process. To meet the eligibility criteria, businesses must be based in Northern Ireland and sell goods from Northern Ireland to an EU member state and receive goods in Northern Ireland from VAT registered EU businesses exclusively for business use.
Finally, the goods sold by your business must be located in Northern Ireland at the time of sale and your business must reach the selling threshold of €10,000 (£8,818) to EU member states per year.
For more expert business advice or for further information on how your business can benefit from the OSS Scheme, please feel free to email the business support team at RB+ to start a conversation: email@example.com