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Brexit Tax Dossier updatedJan-13-2021

Our Brexit Tax Dossier has been updated to reflect the withdrawal of the United Kingdom from the European Union after the expiration of the transition period

By linking to treaties and national chapters, the dossier guides users to help them find and simultaneously consult all the information needed to assess the impact of Brexit either on their own or their clients’ businesses.

The main impact of the United Kingdom’s withdrawal concerns indirect taxation (VAT and customs duties), but there are also several direct and indirect consequences to consider for direct tax purposes.

In the area of indirect taxes, Brexit has substantial implications for the movement of goods between the United Kingdom and EU Member States, as the relevant VAT and excise duty facilitations for intra-Community movement of goods are replaced by additional customs formalities. For domestic transactions, the United Kingdom is now free to gradually diverge from EU regulations, for example in determining which transactions qualify for VAT exemptions. Additionally, there are immediate effects for cross-border VAT refund requests and the provision of electronically supplied services subject to the Mini One-Stop Shop (MOSS) scheme.

In the area of direct taxes, the following EU corporate tax directives ceased to apply in relations with the United Kingdom upon the expiration of the transition period:
•    European Union Parent-Subsidiary Directive (recast) (2011);
•    European Union Interest and Royalties Directive (2003); and
•    European Union Merger Directive (2009).
 

In addition, several domestic exemptions based on the EU/EEA residence of the recipient of income are no longer applicable to UK recipients.