What You Need To Know
Exporting goods and services is one of the most important ways to facilitate growth for a business within the international marketplace.
Many shy away from exporting though, seeing it as a complex, laborious process. However those who thrive in the changing landscape of exports do so with innovation, productivity and a level of competitiveness that gives them a firm grasp in the marketplace and a considerable advantage over their rivals.
Research and familiarity with the legislation involved in exporting is key to their success, with changes planned due to the UK leaving the EU those things are even more important.
With that in mind here is some practical insight into what exactly you need to know if you are considering exporting goods or services abroad.
Navigating through change
Leaving the EU has arrived and with it a range of changes for UK exporters, laying the foundation now, to navigate them is important. Here are some of the basic factors to establish for compliance from day one:
- The exporter must be established within the UK, meaning its offices must be registered within the UK. If that isn’t the case then a third party customs agent can act as the exporter of record if they are UK-based
- Export declarations must be completed and submitted (these can cost between £15-£55 but can cost more)
- As an exporter, documents such as road consignment notes, MRN or movement reference numbers (from the export declaration) and export license duplicates should be passed on to the freight forwarder
- Obtain an EORI number and EU EORI number if your business imports into the EU
- Consider working with an external provider to handle border formalities and compliance on your company’s behalf
- It is a requirement of HMRC that all records are kept for a minimum of four years, failure to do so could lead to penalties or enforcement measure
Procedures relating to exports are more specific than those related to importing. Where the customs declaration is concerned, there are specific requirements regarding the information that must be included. Freight forwarding services can work together with compliance providers to handle these logistical challenges.
For the changes that Brexit will bring, many UK-based exporters are considering the following points:
- Appointing a single customs compliance solution to work with one or more freight forwarders to reduce costs and streamline their exports
- Establishing the capacity of their freight forwarding service to handle additional customs declarations as well as their ability to operate in the EU post-transition (taking into account the possibility of additional driving licence and permit requirements)
Invoicing for your goods or services
Many new accounting softwares such as Xero can help with this but you should consider collecting funds in wherever you are exporting to in the local currency.
This is something that will give you an advantage over your competitors being able to invoice in the local currency as your clients will prefer to pay in there native currency.
We offer our clients multi currency accounts, which give you named currency accounts, in your businesses name, to collect those funds local. So as an example, you are exporting goods to Switzerland and the company would like to pay you in CHF. By using our services we provide you with CHF account details via our platform. You provide this to your client, payment is received. You can now move this back to GBP, or move to another currency. You can read more about this on our blog here.
Companies exporting goods out of the UK may also need to take into account the following factors:
Regulated products such as cosmetics, machinery and certain products containing chemicals will need to meet EU regulatory requirements; these EU regulators will be separate to UK regulators post-transition, meaning potential new obligations for manufacturing exporters.
Where exporters historically relied on EU VAT processes to streamline their reporting processes, there may be a need to register for VAT in the EU. For those businesses supplying goods directly to EU-based clients, a range of new e-commerce rules will come into effect post-transition, further details can be found here.
For in-depth help and advice on these and many other aspects of exporting goods, both to the EU and beyond, including information on export licences and special rules, the UK government website has a range of resources dedicating to helping exporters to make the transition period a smooth one, details can be found here.
OPEN AN ACCOUNT AND START MAKING FASTER PAYMENTS IN HUNDREDS OF CURRENCIES
If you have any questions regarding our payment capabilities please feel free to contact us.