Most UK importers were unprepared for the recent introduction of import controls on EU goods, according to a report from the Federation of Small Businesses (FSB).
Full customs declarations and controls took effect from 1 January 2022, although safety and security declarations are not required until 1 July 2022.
Before 1 January 2022, full customs declarations for EU goods could be deferred at the point of arrival.
Now, importers will have to submit paperwork which includes notice of food, drink, and products of animal origin imports in advance of arrival.
Research from the FSB discovered that only 25% of small importers knew of the changes and had prepared for them prior to this month.
One in eight (16%) importers polled said they were unable to prepare for the introduction of checks in the current climate, and 33% were unaware of the new rules prior to the study.
Mike Cherry, chairman at the FSB, said:
“A lot of small firms simply don’t have the cash or bandwidth to manage this new red tape.
“They should speak to suppliers to ensure they have all they need to make declarations, consider alternative providers if that looks like an efficient way forward, and think about different transportation routes.
“Stockpiling is naturally a temptation for those fortunate enough to have the funds for it, but there is already a squeeze on warehousing space – if everyone ramps up storage, that squeeze will only tighten.”
Importers have already had to contend with increased bureaucracy since the UK formally left the EU this time last year.
Complex VAT rules on imports changed at the same time, requiring UK businesses to account for import VAT on goods worth £135 or more.
Most firms impacted by this rule use the postponed VAT payment system, which allows them to account for VAT on imported goods on their next VAT return.
This means the goods can be released from customs without the need for immediate VAT payment.
Get in touch to discuss any aspect of VAT.