Businesses moving goods between Northern Ireland and the European Union have been told they need to be aware of new data requirements when submitting Intrastat dispatches declarations.
Since 1 January 2022, businesses completing dispatch declarations on Intrastat have been required to include the country of origin of their goods and the VAT number of their buyers or partners.
Traders in GB no longer make Intrastat declarations. The change in data requirements therefore only applies to traders moving goods between EU member states and Northern. Intrastat declarations are also not needed for trade between Great Britain and Northern Ireland.
What is Intrastat?
According to an article on Lexology by lawyers from Baker McKenzie, Intrastat is the EU’s system for tracking goods movements between member states of the EU.
“Authorities use the statistical data on international trade obtained with Intrastat for example when negotiating trade agreements and for monitoring of the functioning of the internal market,” write lawyers Jorge Gómez Alguacil, Yassine El Bojaddaini and Thijs van Luijt.
Does the UK have an equivalent?
According to gov.uk, it does: “The UK’s Office for National Statistics (ONS) uses the monthly trade in goods figures collected by HMRC together with the trade in services survey to produce the ‘Balance of Payments and National Accounts’ figures.
“The Bank of England uses monthly trade data as part of its key indicators for gauging the state of the UK and world economic environment to set interest rates each month”.
Why are NI firms affected?
Businesses registered for VAT in the UK who move goods between Northern Ireland and the EU must continue to submit Intrastat declarations if they meet certain criteria (see below).
This is because Northern Ireland has effectively remained a member of the EU single market for goods under the terms of the Northern Ireland Protocol.
British firms who move goods between GB and the EU do not need to submit Intrastat declarations any longer because the UK, as a whole, left the EU single market when it completed its departure from the EU when the transition period finished at the end of 2020.
In effect, goods moving between GB and the EU are now declared as imports and exports, negating the need for Intrastat declarations.
Who should make Intrastat declarations?
According to gov.uk, businesses only need to register to make Intrastat declarations if, in any calendar year, they:
- receive more than £500,000 worth of goods from the EU into Northern Ireland
- move more than £250,000 worth of goods from Northern Ireland to the EU
EU registered businesses moving goods between EU member states also need to make Intrastat declarations if the value of the goods movements exceed the above thresholds.
What are the new requirements?
In June 2021, the EU announced that firms will need to include the following additional information in their Intrastat dispatches declarations:
- Partner VAT ID
- Country of Origin
According to NIBusinessInfo.co.uk, the ‘Partner VAT ID’ is a combination of the VAT number of the operator to whom the goods are dispatched (eg the buyer) and the country code for the country they are VAT-registered in. An example would be FR12345678901 for a French buyer.
The country of origin will be indicated by a two-digit alpha code for the country where the goods are deemed to have originated in.
A goods’ origin can be determined by multiple factors, including if it was wholly obtained in that country (e.g. grown in Northern Ireland) or for goods produced in more than one country; the place where the last substantial transformation took place (e.g. a jumper made in Northern Ireland using wool from Australia).
Further guidance on rules of origin can be found on gov.uk.
When are the new rules effective?
The new data requirements came into force on 1 January 2022.
According to Baker McKenzie, EU member states should have adapted their relevant platforms to enable Intrastat declarations to be completed with these new data elements.
It is an EU wide regulation regardless of implementation by EU member states, so “operators must be ready and perform the adaptation required to their IT systems to comply,” Alguacil, El Bojaddaini and van Luijt say.
Record keeping and skills
Aimee Maltman, the deputy to the director of the IOE&IT Academy, said traders should ensure they have the relevant data and documentation on hand to comply with the new rules.
“Compliance with the new rules is essential for NI firms trading with the EU,” she said. “Firms should ensure they have the correct EU VAT numbers for their customers on record and that they hold the origin of the goods being dispatched to the EU on file. Preparation is key to ensuring the Intrastat monthly deadlines are met on time.”
She added that firms that need help with these new requirements should consider taking the ‘Moving goods into and out of NI’ training course provided by the IOE&IT.