Brexit took effect on the 1st of January 2021, and now we are beginning to see what this means when shopping from British retailers. Here’s all you need to know about shopping online from UK based stores post-Brexit.
All UK online sales to Irish and other EU customers are treated as exports and are zero-rated for UK VAT (value added tax). However, import VAT may be payable in Ireland on some orders. No one should be asked to pay both UK VAT and Irish VAT. From Jan 2021 to July 2021, if the value of a package delivered from the UK to Ireland is less than €22 (including delivery charges), then it will be exempt from Irish import VAT.
However it is important to note that when shopping on a website that uses Sterling, 22 Euro is treated as £19.95 GBP for all of January. If your total order excluding UK VAT is more than £19.95 then you will be charged Irish VAT at 21%.
The €22 exemption is per package – not per item. If you are ordering several low priced items you may want to think about ordering them separately to avoid VAT.
The Department of Enterprise, Trade and Employment is also advising consumers to seek a refund if British sellers apply a UK VAT charge to their transactions. In a statement, the department said consumers should seek a refund from the UK suppliers they are purchasing from.
If your online purchase costs more than €150 you will have to pay VAT and customs duty. This will be collected by the company that delivers your parcel. The company usually has an administration charge. Methods of delivery and collection differ from company to company, so you should contact them directly for more information.
The rate of customs duty that applies depends on the products you bought. Factors such as transport, any insurance and handling charges can affect your rate of customs duty. You can find the rates of what you ordered in the Taxation and Customs Union database.
Certain goods are subject to excise duty. This is a tax charged on the production and importation of alcohol, tobacco and oils. These goods are currently free to move between the UK and the rest of the EU with the excise duty suspended.
Consumers are also being warned that since Brexit, only goods bought from the UK that are of UK origin will avoid tariffs under the Free Trade Agreement in place. So, if goods sourced outside the EU are being sold by a British seller to an Irish consumer, tariffs and other charges can be applied. The Government is advising consumers to improve their knowledge of the new arrangements now that Brexit has taken affect.
The Minister for Trade Promotion, Digital and Company Regulation Robert Troy TD, has issued a reminder to Irish consumers about the new arrangements now in place for online retail under the recently concluded Trade and Cooperation Agreement between the EU and the UK.
Minister Troy said: “We are now operating under a new set of rules for online trading due to Brexit and I want to remind Irish consumers to be alert to potential additional costs and changed entitlements when buying from UK online retailers.”
The Minister reiterated that Irish consumers should be aware that:
- only goods of proven UK origin are tariff free
- goods bought from the UK but not of UK origin that cost more than €150 may be subject to customs duty
- Irish VAT will apply on goods bought in the UK that cost more than €22
- where UK VAT has been charged on the purchase of goods, Irish VAT will still apply when the good(s) is imported into Ireland.
- If an Irish consumer is charged UK VAT, a refund of such VAT should be sought by the consumer from the supplier.