What changes are being made at Zendbox to prepare for Brexit?

Chloe Willcox
Content Writer | Zendbox

Page last updated 23 Dec 2020.

You’ll no doubt be aware that the Brexit transition period between the UK and the EU will end on 31st December 2020 at 11pm, and this will change how you trade with the remaining EU countries.

At Zendbox, we have been working hard for the last nine months to reduce the impact of Brexit to your business as much as possible to ensure continued smooth trading into Europe.

What changes are being made at Zendbox to prepare for Brexit?

If you are a seller trading into the EU, there are two main changes you should be aware of:

1) Customs declarations

All orders going into the EU, now require us to provide customs declaration information. We have been working with our shipping partners to be able to digitally pass them all the information required. This means that as a Zendbox customer, all customs declarations will be completed automatically by us on your behalf, minimising delays to your customer.

Note: If additional information about your product is needed, someone from our service team will contact you shortly.

2) Taxes and duties

VAT

Previous to January 31st 2020, you charge VAT at the point of sale no matter the value. From 1st January 2021, this will change based on the value of the transaction.

If you are unsure, how to implement, then we recommend speaking to an accountant who can advise.
When selling into Europe, there are two cost elements that are going to change.

VAT

Currently, you charge VAT at the point of sale no matter the value. From 1st January 2021, this will change based on the value of the transaction.

Orders for the UK will still have VAT charged at the point of sale and paid to the UK government.

For orders going to the EU:

Orders under £120 – VAT will be collected at the point of sale. This is the same way you currently operate, no price changes are needed

Orders over £120 – VAT in this instance will not be directly collected at point of sale, it will be collected in the destination country and charged at customs. Therefore VAT will be paid by Zendbox, and rebilled to you at the end of the month. You will not need to adjust the pricing on your site because the amount paid will be the same, it will just be collected differently.

Note: You will need to ensure when compiling VAT returns that you do not take into account orders over £120 for VAT

You’ll never pay VAT twice.

Zendbox will be shipping your parcels to Europe on Delivered Duty Paid (DDP) terms, so we will pay the duties and taxes to clear the goods and then charge this back to you.
Parcel Value
Charge
<£120
>£120
VAT -21%
Paid at point of sale
Paid in destination country
You will not need to adjust the pricing on your site because the amount paid will be the same, it will just be collected differently.
Duty

Currently there is no duty paid when goods move throughout the EU. As of 1st January 2021, goods sold in the UK moving into the EU will attract duty if the value of the goods being sold exceeds £135. The rate of duty is based on the HS tariff code (commodity code) and country of origin that is applied to your product. Given the generous threshold before duty becomes payable, it should only impact a very small percentage of your orders.

Again, Zendbox will be shipping your parcels to Europe on Delivered Duty Paid (DDP) terms, so we will pay the duties and taxes to clear the goods and then charge this back to you.

To ensure that we have the correct HS tariff codes for your products, we will shortly send you a list of your SKUs and codes we have. It is your responsibility to ensure they are correct.
Parcel Value
Charge
<£135
>£135
Duty
The rate of duty due is based on the HS tariff code (commodity code) and country of origin that is applied to your product.

The introduction of HS tariff codes.

All orders for the EU will now need to provide customs declarations. An HS tariff code is a harmonized system code, you may have also heard them called commodity codes or comm codes, and these codes combined with the country of origin indicate the duty that needs to be paid on goods over £135.

The good news is that Zendbox is able to pass all the information required for customs declarations on to our shipping partners for you, provided we have the correct HS tariff codes in our system.

This means that as a Zendbox customer, all customs declarations will be completed automatically by us on your behalf. All you need to do now is provide confirmation of your codes.

You will receive an email from Zendbox asking you to confirm your HS tariff codes for all your SKUs shortly, you may have already received it. Please confirm these codes to us as soon as you can. It is your responsibility to make sure we are operating with the correct codes.

Going forwards, you will need to enter the HS tariff code for all new product SKUs you add to your inventory. Zendportal now has new fields to accommodate the additional information required. See details of the Zendportal changes.
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