Tariff

Generally, all goods imported into the UK are subject to the UK Global Tariff (UKGT). A tariff is a tax or duty imposed by one country’s government on goods and services imported from another country.

The tariff makes imported goods and services more expensive to buy because the importers have to recoup the tax and duty paid.

ProsCons
Protect local businesses by giving them a better chance to compete in the industry. They can charge a lower price to increase demand. Imported goods and services become more expensive
Protect domestic manufacturers and employ local people Importers may stop importing if demand is low because they have to charge expensive price tags, which leads to loss of income for the government.
More money for the government through collecting import taxes and duties.

No Tariff to pay

There are situations where the UK global Tariff does not apply to your imported goods.

Free Trade agreement

You are importing goods from a country that has a trade agreement with the UK. For example, The UK has already signed a free trade agreement with Japan on 23 October 2020. You can read more about the UK-Japan Comprehensive Economic Partnership Agreement (CEPA) on GOV.UK website.

Tariff Suspension

The UK helps businesses to remain competitive in the global market by suspending import duties on certain goods. Usually, these goods are used in domestic production. For example, The Uk suspends all tariffs on a group of medical items critical in the response to COVID-19 on 1 January 2021. The suspension is for 12 months on all goods listed by the World Health Organisation (WHO) as critical goods would have 0% duty. For example, surgical gloves under the commodity code of 40151100 are 0% duty.

Imports from country under the UK Generalized Scheme of Preferences

The UK reduces or removes import tariffs on imports from developing countries classified by either the United Nations (UN) or the World Bank as low-income and lower-middle income countries. For example, The UN classified Madagascar as the least developed country. Imports from Madagascar have quota-free access and nil rates of import duty.

Department for International Trade

If you would like to export or import goods or services into and out of the UK, the UK Department for International Trade (DIT) can help you. The DIT provides the following services to businesses wanting to export out of the UK or import from overseas.

  • Create an export plan
  • Find an export market
  • Choose a route to market
  • Get export finance
  • Manage payments for export orders
  • Prepare to do business in a foreign country
  • Prepare for export procedures and logistics
  • Sell services overseas
  • Manage risks of bribery and corruption

There are UK Department for International Trade offices worldwide and also DIT offices around the UK that you may contact to ask for help.

Use Trade Tariff Tool to find Commodity code for Customs declaration

You would require to find the right commodity code for your goods to complete your customs declaration paperwork. Your commodity code will tell you the correct Customs Duty and import VAT to pay.

You may use the HMRC Trade Tariff tool to look up your commodity code. For example, a commodity code for the import of unworked Sapphire is 7103100000. The goods are subject to 20% VAT and 0% duty if it is subject to a third country duty.

You can handle your customs declaration paperwork yourself or you may hire freight forwarders, customs agents or brokers, or fast parcel operators to handle your customs declaration paperwork for you. The person or business you hire to represent you must be established in the UK.

Usually, duty must be paid before your goods can be released unless you have a duty deferment account with HMRC.

Import goods under your company’s name

You must ensure all the legal filings such as Confirmation Statement, company accounts, and corporation tax returns are up to date with Companies House and HMRC if importing using your company’s name.

VAT registration requirements

All businesses trades within and/or with the UK must follow the VAT registration requirements. Value Added Tax (VAT) stands for Value Added Tax. You must register for VAT with HM revenue and Customs if your annual sales exceed the VAT registration thresholds.

VAT registration thresholds in the UK

Below is the VAT registration requirements and threshold with effect from 1 April 2017.

scenarioAnnual sales threshold
1VAT registration£85,000 and more
2Distance selling into the UK registration£70,000 and more
3Bringing goods into the UK from the EU£85,000 and more
4VAT deregistration£83,000 and less
5To complete the simplified EC Sales list£106,500 or less & supplies to EU countries is less than £11,000
source: GOV.UK

Post VAT registration requirements

Once your business – a sole proprietorship or partnership or your company is successfully registered for VAT in the UK, HMRC will issue a VAT certificate to your business. In the VAT certificate, you will see your default VAT return quarter end date. Usually, it is a standard 3 months per quarter period. For example, if HMRC states your VAT return quarter end date is 31 March then you would have one month and 7 days to submit VAT return for 1 Jan to 31 March to HMRC.

You may apply to HMRC to change your VAT return quarter end date. For example, you can apply to join VAT annual accounting scheme if your sales are less than £1.35 million or less per year. Once you joined the VAT annual accounting scheme, you would only require to submit one VAT return per year.

Other compulsory filings

If your business is a limited company or limited liability partnership (LLP) registered with Companies House, you must comply with the UK company law.

You must prepare and submit the the documents to Companies House in addition to your VAT return to HMRC.

You can submit your company documents online. You would require your company’s authentication code to do so. The authentication code is the electronic equivalent of your company’s director(s) signatures. Hence, you must keep it safe.

Companies House has also created an interim paperless filing service to accept documents which would normally require a live signature during COVID-19 pandemic. You can easily upload your documents to the Companies House website.

If you require help with your company’s filings, contact our accountants. They will be more than happy to assist you.

Payback the overpaid Self Employment Income Support Scheme Grant

HM Revenue and Customs (HMRC) published guidance seeking self-employed individuals to tell HMRC and payback the overpaid Self Employment Income Support Scheme Grant if they received the grants but were not entitled to it.

The Government use the Self Employment Income Support Scheme Grant to support self-employed individuals during this Coronavirus (COVID-19) outbreak.

HMRC is asking you to report any overpaid Self Employed Income Support Scheme grant within the notification period given to avoid penalty. This includes If you received the Self employment income support scheme grant from HMRC but you were not entitled to.

You must pay back the grant you were not entitled to HMRC.

Inform HMRC about the Self Employment Income Support Scheme Grant overpayment

You must notify HMRC within 90 days of you received the grant on or after 22 July 2020 and you have not repaid it.

If you received the grant before 22 July 2020 then you must inform HMRC by 20 October 2020.

Likewise, if you have overclaimed the Coronavirus Job Retention Scheme grant, you must notify HMRC and pay back the money.

Publishing details of deliberate defaulters (PDDD)

HMRC may publish your details on the Publishing details of deliberate defaulters (PDDD) list for deliberately not notify HMRC of the overpaid Self Employed Income Support Scheme Grant. You details will remain online for 12 months. See the factsheets here CC/FS13.

You may check the current PDDD list online here.

Companies House filings during COVID-19 pandemic

Companies House also provide support to UK businesses during COVID-19 pandemic. Your company’s account filing deadline is extended for an additional 3 months. This will help you to avoid a late filing penalty if you are unable to deliver your company accounts on time during this pandemic. You do not need to do anything. You just need to go to Companies House website to check your new filing deadline.

On the same note, you would have 6 weeks to file your confirmation statement. Likewise, for the events driven filings, you will have 42 days (6 weeks) to notify Companies House instead of the usual 14 days filing deadline. For example, you moved to a new office and this office is also your registered office for your company. In this case, you have 6 weeks to notify Companies House.

In addition, Companies House also created an interim paperless filing service to accept documents which would normally require a live signature.

You are encouraged to submit your documents to Companies House digitally. You can use the web filing service to file the following documents to Companies House.

To file online, you would require your company’s authentication code. The authentication code is the electronic equivalent of your company’s director(s) signatures. Keep safe your authentication code.

If you require help with your company’s filings, contact Our accountants. They will be more than happy to assist you.

Overclaimed Coronavirus Job Retention Scheme grants

HM Revenue and Customs (HMRC) published guidance on potential penalties to businesses with overclaimed Coronavirus Job Retention Scheme (CJRS) grants. The Government use the Coronavirus Job Retention Scheme to help businesses to retain their staff during this Coronavirus (COVID-19) outbreak. Sometimes, mistakes could happen.

HMRC is asking you to report any overclaimed CRJS grants within the notification period given to avoid expensive penalty. This includes If you received the CRJS and you were not entitled to.

You must pay back the Coronavirus Job Retension Scheme grants you are not entitled to HMRC.

Report overclaimed Coronavirus Job Retention Scheme grants to HMRC

You must notify HMRC within 90 days of you received the CJRS grants if you have not repaid it.

In some circumstance, you may be entitled to the CJRS grants but later due to change of circumstance you no longer entitled to it, in this instance, you have 90 days to inform HMRC. For example, your furloughed staff left your business for good and you continue to claim the CJRS grants for that staff.

The latest date you must report your overclaimed CJRS grants to HMRC is 20 October 2020.

Likewise, if you have been overpaid under Self Employment Income Support Scheme, you must notify HMRC and pay back the money.

Publishing details of deliberate defaulters (PDDD)

HMRC may publish your details on the Publishing details of deliberate defaulters (PDDD) list for deliberately not notify HMRC of the overclaimed CJRS grants. You details will remain online for 12 months.

You may check the current PDDD list online here.

Companies House filings during COVID-19 pandemic

Companies House also provide support to UK businesses during COVID-19 pandemic. Your company’s account filing deadline is extended for an additional 3 months. This will help you to avoid a late filing penalty if you are unable to deliver your company accounts on time during this pandemic. You do not need to do anything. You just need to go to Companies House website to check your new filing deadline.

On the same note, you would have 6 weeks to file your confirmation statement. Likewise, for the events driven filings, you will have 42 days (6 weeks) to notify Companies House instead of the usual 14 days filing deadline. For example, you moved to a new office and this office is also your registered office for your company. In this case, you have 6 weeks to notify Companies House.

In addition, Companies House also created an interim paperless filing service to accept documents which would normally require a live signature.

You are encouraged to submit your documents to Companies House digitally. You can use the web filing service to file the following documents to Companies House.

To file online, you would require your company’s authentication code. The authentication code is the electronic equivalent of your company’s director(s) signatures. Keep safe your authentication code.

If you require help with your company’s filings, contact Our accountants. They will be more than happy to assist you.

Pay stamp duty to HMRC

Pay stamp duty to HMRC electronically during COVID-19 pandemic when you buy UK limited company shares. This is a temporary measure in place to stop the spread of the Coronavirus (COVID-19). You must pay your stamp duty within 30 days of your stock transfer form being dated and signed.

How to pay

You must pay HMRC electronically by Faster Payment, Bacs or CHAPS. The HM Revenue and Customs bank details are as follows:

Bank nameBarclays Bank Plc
1 Churchill Place
London
United Kingdom
E14 5HP
Account nameHMRC Birmingham Stamp Office
Account number12001098
Sort code08 32 10
IBAN **GB02BARC20114773618595
BIC **BARCGB22
Source: HMRC

** you would require IBAN and BIC if you are sending payment to HMRC from an overseas bank account.

Email your bank payment info to HMRC

Thereafter, you must email your stamp duty payment info to HMRC to expedite your application.

stampdutymailbox@hmrc.gov.uk

You must provide the following info:

  • The payment reference
  • Payment amount
  • Date of the bank payment made
  • an electronic copy (for example, a scanned PDF) of either your:
    • signed and dated stock transfer form. You can get a stock transfer form from a broker, a lawyer or accountant who deal with shares.
    • the instrument of transfer
    • form SH03 for return of purchase of own shares

Use power of attorney if necessary.

HMRC will accept e-signatures during this coronavirus (COVID-19) secure measures are in place.

HMRC will contact you by email if they have any questions. You will receive a confirmation letter from HMRC by email. No stock transfer forms are currently being stamped.

Read the government guidance here.

Companies House filings during COVID-19 pandemic

Correspondingly, you must register your SH03 with Companies House. You must also send the confirmation letter from HMRC stating the correct stamp duty amount has been paid. Companies House will accept and register an unstamped SH03 form. The letter will not appear on the public register.

Companies House also gear up to support UK businesses during COVID-19 pandemic. They automatically extend your company’s filing deadline. This will help your company to avoid a late filing penalty if you are unable to deliver your company accounts on time. You do not need to do anything. You just need to go to Companies House website to check your new filing deadline.

Concurrently, your confirmation statement filing deadline will also be extended. You would have 6 weeks to file your confirmation statement. Similarly, for the events driven filings, you will have 42 days (6 weeks) to notify Companies House instead of the usual 14 days filing deadline.

In addition, Companies House also created an interim paperless filing service to accept documents which would normally require a live signature.

You are encouraged to file your company documents to Companies House digitally. You can use the web filing service to submit the following documents to Companies House.

To file online, you would require your company’s authentication code. The authentication code is the electronic equivalent of your company’s director(s) signatures. Keep safe your authentication code.

If you require help with your company’s filings, contact Our accountants. They will be more than happy to assist you.

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