UK VAT refunds – potential Brexit cut-off for foreign traders?

Currently, UK VAT refund claims can be lodged by EU based foreign traders/businesses through the EVR (Electronic VAT refunds) through their local EU Member State tax administrations. In Ireland, this is done using the Revenue Commissioners ROS portal.

Based on administrative protocol and if the UK will exit the European Union without transitional arrangements being agreed or in place, businesses and the HMRC will not have access to the EVR platform.

It’s not certain whether the UK Government through the HMRC will adopt a foreign trader VAT refund regime. Even if such a scheme is to be adopted, there are likely to be long delays in obtaining refunds.

The reality of VAT at the point of entry will arise as the current intra-community free movement of goods cannot continue post-exit from the EU on 31st October 2019.  

Given this ambiguity, it’s recommended that business who trade into the UK and do not have UK business establishment/UK VAT registration address this immediately to avoid unnecessary UK VAT costs.

Should a business be incurring UK VAT costs, it would beneficial to seek immediate assistance with quantifying potential UK VAT reclaims and identify what can be processed efficiently through the EVR platform for cashflow reasons.

Mazars believe that any valid VAT refund reclaims lodged through the EVR platform before the 31st October exit date will have to be processed by the HMRC under existing protocols, but there is no guarantee beyond this date.

For more information please contact:

Alan McManus
Director, VAT Advisory Services 
+353 (0)1 512 5525