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Published:October 12, 2021

Santa’s supply chain: Is your business ready for the Christmas rush?

The UK tax authority is already alerting customers to possible unforeseen costs affecting their Christmas presents. 

Santa’s supply chain: Is your business ready for the Christmas rush?

Christmas is nearly here. Admittedly, it’s only October. But keen Christmas present givers are already planning their purchases. More importantly, from a logistic perspective, retailers are paying close attention to their supply chains. And Brexit adds another layer of complexity to the calculations. 

 

UK tax office tells customers to look out for extra charges

In a statement, HMRC said: “With 100 days until Christmas, we want to remind shoppers of the changes introduced since January 1 so that their present-buying experience is as smooth as possible, and that online shoppers don’t inadvertently get caught out by any unexpected charges.”

A number of changes to UK regulations can potentially affect shoppers in the UK. Notably, all goods are now subject to VAT. The £15 low value VAT exemption now longer applies.

Secondly, imported goods worth no more than £135 are subject to sales VAT. The onus is on the seller (or the online marketplace through which the sale is made) to charge the VAT at the point of sale. 

Another important change is a direct result of Brexit. As the UK is no longer part of the European Single Market, import VAT applies on imports to the UK from the EU.  Customers should therefore anticipate extra costs making online purchases from EU Member States. 

 

Don’t let your customers get caught unawares

Research indicates that online shoppers in the UK are already confused by Brexit. Not all retailers have factored the additional VAT and import costs into their pricing, and many couriers are charging additional handling fees for the added border admin. 

Managing returns between the UK and EU states is also now considerably more complex. 

 

Managing VAT and border bureaucracy

The year’s Christmas rush will be exacerbated by Brexit and stretched supply chains.  

Ecommerce sellers and importers need creative solutions to ensure customer satisfaction and consistent supply. 

re:TRADE, powered by VAT IT, offers a complete supply chain solution that tackles all logistics, customs, VAT compliance processes, and refund mechanisms. Get in touch with re:TRADE to ensure your goods always get where you need them to be, when you need them to be. 

 

 

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