Is your shop OK with the latest UK changes?
If you know people or customers who live in the UK, you’ve probably heard the word “Brexit” thrown around. That’s the British exit (see what they did there?) from the European Union, which began in earnest in 2020. In 2021, we’re starting to see the changes in practice. For businesses selling goods in and out of the country, items will be taxed more heavily, as there isn’t as close and friendly a relationship between the UK and other countries as there once was. It’s like the UK and Europe used to be roommates, but the UK got their own place. Everyone still likes each other just fine, but it’s a little weird if the UK digs around Europe’s fridge for spaghetti leftovers. Instead, they go out to dinner and split the bill. It’s fair, but a bit more expensive.
Selling to the UK
Previous to February 2021, some inexpensive items weren’t taxed when shipped to the United Kingdom. Additionally, purchases under 135 GBP could be taxed when they were imported at customs. That meant that a seller in the USA or Australia (or anywhere outside of the UK) could sell the items without having to learn all of the tax details, and the buyer would simply pay appropriate taxes (if needed) when picking up their shipment. Now the country’s value-added tax (VAT, if you’ve seen that term floating around) applies to smaller purchases, and most VAT is required to be collected at checkout.
With these new rules, many indie shops are choosing to restrict where they’ll send their products. While people love getting orders and sharing their goods with customers all over, sometimes the headache of dealing with UK customs for both shop owner and customer is too much.
If you’re a shop facing this decision, we’ve made it easier for you to adjust your shipping settings to exclude the UK from European shipping prices, either to increase the UK prices so that VAT is covered, or to avoid accepting orders from the UK entirely, at least until the situation has improved for small businesses.
Updated Shipping Profiles
To help shops make decisions on how to handle UK-based customers, we’ve gotten a little more specific within Shipping Profiles. If you want to ship to all of Europe, set up a few profiles to cover all of the bases: the European Union, the United Kingdom, and Europe (which we clarify in your admin is the remaining European countries that are not the UK and not in the EU). This also gives you the flexibility to charge different shipping rates for each of these profiles as needed.
If you decide that it’s just too tough to ship to the UK right now, simply skip setting up a United Kingdom shipping profile. And make sure you also avoid the Everywhere Else shipping profile: this catch-all profile tells shoppers that you ship worldwide, so if that’s not your intent, just take a little longer to set up shipping prices for each zone where you’d like to accept orders.
In the UK but not ready to mess with exporting under new rules? We get that! Set up just one shipping profile for the United Kingdom. You’ll be set to only accept orders within your own country, and can add other countries or zones at a later time, when you’re ready.
We’re still figuring out how Brexit will impact our community of small and independent shops. Things are evolving and just starting to be implemented, so there’s more to investigate and understand. As we figure out how Big Cartel can help, we’ll keep you updated.
Whenever we start talking taxes, we advise that individual shops work directly with a professional accountant or tax advisor. While we do our best to share general info, different products, locations, and other scenarios can impact your specific responsibility. Get specific with a qualified person to make sure that you’re running a business ethically and legally.