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What is postponed accounting?

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Summary

From 1 January 2021, Postponed VAT Accounting has been introduced in both the UK and Republic of Ireland to improve business cash flow for imports.

Description

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When using Postponed VAT Accounting, import VAT due on goods arriving in the UK or Ireland can be accounted for on a VAT Return rather than having to pay the VAT as soon as the goods arrive at the border.

Postponed VAT Accounting has been introduced to mitigate the cashflow impact on businesses that previously didn’t have to factor in paying Import VAT when buying goods from the abroad.  UK Postponed VAT Accounting can be used for all Rest of the World (ROW) imports. For Great Britain this will now include imports from the EU while for Northern Ireland, while Postponed VAT Accounting can be used, it will only be relevant for Non EU imports. Postponed VAT Accounting in the Republic of Ireland will also be available for all ROW imports which will now include imports from Great Britain but not from Northern Ireland.

How to process Postponed VAT Accounting in your software:


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