The UK is due to leave the EU on 31 January 2020. In terms of EU VAT refund claims under Directive 2008/9/EC (‘8th Directive’), there is some confusion amongst taxpayers and advisors as to what this means…
PLEASE NOTE THAT THIS UPDATE HAS NOT BEEN FORMALLY AGREED WITH HMRC – but we understand this to be the current position.
The UK is due to leave the EU on 31 January 2020. In terms of EU VAT refund claims under Directive 2008/9/EC (‘8th Directive’), there is some confusion amongst taxpayers and advisors as to what this means.
Since the General Election in the UK at the end of last year, the European Union (Withdrawal Agreement) Act 2020 (“EUWAA”) has been passed in the UK Parliament. THE EUWAA introduces a transitional period which runs for 11 months to 31 December 2020. This will mean that, from a UK perspective, the special schemes and EU VAT rules will continue to apply to the UK until that date.
From an EU point of view, the Member States have agreed in principle to the terms of the Withdrawal Agreement. However, this has still to be formally ratified by the EU Parliament, which is not expected until 29 January 2020. There is a slight risk, therefore, that the EU Parliament may not ratify the Withdrawal Act and the UK leaves the EU on a “no deal basis” on 31 January 2020.
Whilst businesses should be prepared for this risk, it is not envisaged that the UK will leave the EU on a “no Deal basis” on 31 January 2020, as this is not in the interests of either the UK or the EU.
On the assumption, therefore, that the Withdrawal Agreement is ratified by both parties, the MOSS and EU Refund portals will still be available for EU and UK businesses to use. The EU portal will remain open for EU and UK businesses to make EU refund claims until, we understand, 31 March 2021 under article 51.3 of the Revised Withdrawal Agreement.