Guidance

Check when you can account for import VAT on your VAT Return

If your business is registered for VAT in the UK, find out when you can, or need to, account for import VAT on your VAT Return (also called postponed VAT accounting).

Accounting for import VAT on your VAT Return means you’ll declare and recover import VAT on the same VAT Return, rather than having to pay it upfront and recover it later.

The normal rules about what VAT can be reclaimed as input tax will apply.

Who can account for import VAT on their VAT Return

From 1 January 2021, if your business is registered for VAT in the UK, you’ll be able to account for import VAT on your VAT Return for goods you import into:

  • Great Britain (England, Scotland and Wales) from anywhere outside the UK
  • Northern Ireland from outside the UK and EU

There will be no changes to the treatment of VAT or how you account for it for the movement of goods between Northern Ireland and the EU.

You do not need any approval to account for import VAT on your VAT Return.

Non-established taxable persons

If you’re a non-established taxable person you’ll need to get someone to deal with customs for you, including completing your customs declaration.

If you want to account for import VAT on your VAT Return, you must tell the person dealing with customs for you to select this on your customs declaration and enter your details as the consignee.

When you can account for import VAT on your VAT Return

You can do this if:

  • the goods you import are for use in your business
  • you include your VAT registration number on your customs declaration

Goods in special procedures

If you declare goods into a customs special procedure, you can select that you’ll be accounting for import VAT on your VAT Return when you submit the declaration that removes them into free circulation from the following special procedures:

  • customs warehousing
  • inward processing
  • temporary admission
  • end use
  • outward processing
  • duty suspension

Excise goods

You can select to account for import VAT on your VAT Return when you release excise goods for use in the UK – also known as ‘released for home consumption’.

This includes when goods are released from an excise warehouse after being in duty suspense since the point of import.

If you do not know the full customs value of goods

You can still account for import VAT on your VAT Return, even if you cannot confirm the full customs value of the goods that you import.

If you are using CHIEF, you should:

  1. Declare the highest value for VAT.
  2. Select that you’ll be accounting for import VAT on your VAT Return.

If you are using the Customs Declaration Service, you should:

  1. Use a guarantee to cover the amount of VAT that is unknown.
  2. Select that you’ll be accounting for import VAT on your VAT Return for the amount that is known.

When you must account for import VAT on your VAT Return

If you import goods that are not controlled into Great Britain from the EU between 1 January and 30 June 2021, you must account for import VAT on your VAT Return if you either:

You must make sure that when you complete the supplementary declaration you select that you’ll be accounting for import VAT on your VAT Return.

Using someone to import goods on your behalf

If you get a person or business to import goods on your behalf (such as a freight forwarder, customs agent, broker or fast parcel operator) you will need to tell them how you want to account for import VAT on those imports, so they can complete the customs declaration.

If you already have someone you should contact them to tell them if you want to account for import VAT on your VAT Return on goods you import from 1 January 2021. You should keep a written record of what is agreed.

Buying goods from a supplier, who arranges for someone to import goods on your behalf

You can buy goods from a supplier who arranges for a person or business - such as a fast parcel operator - to import and deliver the goods for you. You must agree with the supplier how you want to account for import VAT, so that they can tell them to make the appropriate entry on the customs declaration. You should keep a written record of what is agreed.

Unless your supplier specifically tells them not to, some fast parcel operators will select the option for you to account for import VAT on your VAT Return. Your supplier will tell you about this when they ask you for your EORI or VAT registration number. You will need to tell your supplier if you do not want to account for import VAT on your VAT Return.

The import will appear on your monthly statement in the normal way.

How to complete your customs declaration in order to account for import VAT on your VAT Return

When you complete your customs declaration you can select that you’ll be accounting for import VAT on your VAT Return.

If you use the Customs Handling of Import and Export Freight (CHIEF) system

On your declaration, you’ll need to enter:

  • your EORI number starting with ‘GB’ which includes your VAT registration number into box 8 (Header Consignee), or, if applicable, your VAT registration number in box 44h (Registered Consignee)

  • ‘G’ as the method of payment in Box 47e

If you use the Customs Declaration Service

You need to enter your VAT registration number at header level in data element 3/40.

VAT will be recorded against your EORI and will be at declaration level only.

If you act on behalf of someone else

If you’ve been authorised to act on behalf of your client, you must use their EORI number or VAT registration number on the customs declaration.

If you import goods in consignments not exceeding £135 in value

Find out about the treatment of VAT for overseas goods sold:

These rules will not apply to the import of consignments of goods containing excise goods, you can choose to account for the import VAT on your VAT Return for those consignments.

Further guidance on consignments into Northern Ireland will be provided in a later update.

What you need to do next

If you have selected that you are accounting for import VAT on your VAT Return on your customs declaration you will need to account for import VAT when you complete your VAT Return.

Published 27 July 2020
Last updated 22 December 2020 + show all updates
  1. Information has been added about accounting for VAT if you do not know the full customs value of goods and using someone to import goods on your behalf.

  2. Information on Non-established taxable persons and guidance on how to complete your declaration if you are accounting for import VAT on your VAT return has been added.

  3. Added Welsh translation.

  4. First published.