Good afternoon

Now that the UK has left the EU you will need to look at UK and EU VAT separately.

The UK introduced requirements for remote sellers selling into the UK from 1 January to collect VAT at the point of sale on B2C consignments valued at £135 or less (which sounds like your situation). Above £135 the VAT (and any duty) is paid through the customs import process. You can either look to leave that to the customer or your courier firm/postal operator may assist in offering DDP (delivered duty paid) terms to expedite delivery to the customer. If going down the DDP route you will need both a UK VAT number and EORI (a special import ID number). If you haven’t already seen it here is a link to the UK government registration website:

https://www.gov.uk/vat-registration/how-to-register

The EU position is slightly different. Their new rules come into effect 1 July and are slightly different:
– the start point is an optional import one stop shop (“IOSS”) portal. You will need to appoint an EU based intermediary to register for this as New Zealand does not have a mutual assistance agreement with the EU regarding tax. The IOSS, if used, would apply to consignments of EUR 150 or less and allows EU wide reporting of sales and VAT on a country by country basis through a single portal.
– As an alternative to IOSS, special arrangements to use DDP shipping with the co-operation of the postal operator, courier firm or customs agent can be used. You would need to check with your shipper whether they are, or will, offer this service
– The default approach for the EU is to use the existing customs process whereby the customer must pay VAT and duty before delivery can be made. This usually involves admin charges and is easiest for you and probably the least satisfying customer experience for the customer.

You are not alone in finding this area confusing. Give me a call on 027 22 44 595 if you would like to run through this and gain a clearer path for your next steps.

All best
Morgan