New EU VAT rules to apply in Spain for online purchases from the UK on July 1

Brexit saw a number of changes with regards to exports from the UK to European Union members and the next will take effect on July 1, 2021.

CURRENTLY EU and non-EU sellers selling goods online to EU consumers can import the goods into the EU, directly to the consumer, import VAT-free if the consignment of goods is valued at €22 or below.

The idea was to make life easier for Customs so that they didn’t have to process every small package coming into their country but this is now to change for three main reasons, which aren’t directly caused by Brexit.

Firstly, there is a huge volume of a cheap items coming in from China which the EU wants to regulate, secondly some unscrupulous senders have been declaring a value under €22 for goods worth much more and thirdly EU sellers have been required to charge VAT when selling to other EU countries which puts them at a disadvantage.

In theory, from July 1, both EU and non-EU sellers will be required to charge VAT at the rate prevalent in the country where the customer is based so that no vat is to be collected when the goods are received.

For items with a value over €150 which have been ordered online from a non-EU state, the delivery company will be required to collect the VAT which could be cumbersome if the amount of tax involved is significant and the delivery company doesn’t accept credit or debit cards.

Some UK companies are already gearing up to add VAT whilst others will simply refuse to supply but if you want to import goods from the UK to Spain, provided they are delivered before July 1, the new rules will not apply.