What is an EORI number: import or export between the UK and EU

If you are about to take your e-commerce business international and start importing or exporting between the UK and the EU, you are going to need an Economic Operator Registration and Identification (EORI) number. Get this sorted before you expand to keep costs and delays to a minimum.

You may have a long to-do list when you ramp up your e-commerce business activities, but an EORI number is essential and needs to be prioritised. Before you send a single item this needs to be in place, or your customers could have a lengthy wait for their goods. Failure to have an EORI number may increase costs due to storage and add unnecessary delays to the transit time, so let’s break down everything you need to know and why you need one.

What is an EORI number?

An EORI number is used to identify you and collect duty on your goods within the UK and the EU and is issued by HMRC. This means you will need to apply for one, whether you are a sole trader, an individual, a partnership, or a limited company.

An EORI number has been mandatory for those who ship to and from the EU since 1st July 2009 and replaced the old Trader Unique Reference Number system. It is a method for tracking your business imports and exports within the EU and will still be needed in the event of Brexit.

Your business is identified by your EORI number throughout all customs procedures in and out of the UK and EU and used to exchange information with Customs Authority. Since January 2021, UK businesses have been required to register for a UK EORI number. Until then, EU EORI numbers had been distributed.

Who needs one?

If your e-commerce businesses imports or exports to the EU, and it’s highly likely it does, you will need an EORI number. The scale of the operation is irrelevant. You will need to enter your EORI number on the Entry or Exit Summary Declaration paperwork as your goods are in transit.

If you are currently only selling in the UK market it is still worth considering whether one will be needed moving forward. With Amazon Marketplace and similar schemes, scaling up your business to a more international model is easier than you think.

E-commerce businesses should also consider but obtaining an EORI number and shipping to consumers outside of the UK, they can reach a greater customer base and raise brand awareness internationally.

How do I get one?

To obtain an EORI number you will need to apply with HMRC. The first step is to ascertain whether or not you should be VAT registered. If you need to register for VAT you will want to use accounting software that is compatible with the Making Tax Digital initiative, like Xero.

If you’re an individual or a sole trader, you’ll also need your National Insurance number and your UTR. All entities will need their business start date and Standard Industrial Classification (SIC) code – these are available in the Companies House register if your business is a registered company. You will also need your Government Gateway user ID and password regardless of your business status.

Once you have these details you can follow this link to register for your EORI number. Further guidance on whether you require an EORI number can be found here.

Once you apply for an EORI number, it should arrive to your specified email mailbox within three working days. You can check the progress of your application using your UK VAT number.

It is free to register for an EORI number, but you could run into significant costs if you fail to do so.

What happens if you ship goods without an EORI number?

If you ship an item to a customer without an EORI number, or attempt to receive a shipment of goods, then you will soon discover some issues. Any e-commerce order will be flagged up if it doesn’t have a valid EORI number.

Your shipment will be placed into storage by Customs and will sit there until you can show a valid EORI number. In the meantime, your customer will be inconvenienced and will be less inclined to offer positive feedback due to the delay. You will also start to accrue storage costs after three to five days depending on the country in question. Typically, EORI numbers are received three to five working days after the request but in some instances, it may take longer. Be prepared and apply ahead of time to avoid surprise fines and negative customer feedback.

To release your goods, and prevent further storage bills, you will need to show your valid EORI number. The longer it takes you to obtain one, the higher the storage costs and impact on your business.

Leave enough time

The application procedure should only take you 5-10 minutes. Once you have registered, there may be a delay of up to 3 working days depending on the levels of checks required in your particular case. Ensure you leave enough time before your first shipment to receive your number.

If you do not obtain an EORI number, do not risk shipping any products. Any products found to have been shipped to or from the UK and EU without a valid EORI number will be detained by customs and only released once you can provide proof of your EORI status.

European Commission Validity Register

While it is unlikely that members of the general public will want to check you hold a valid EORI number it is possible. The European Commission has a public register of all valid numbers along with some basic information about the holder, but only if you agree to it. There will be a tick box on the form that deals with the disclosure of this data.

This information allows the customers who choose to check, to know that you are a compliant business and that they can expect to receive their order in good time. If a potential customer checks your EORI status and you are not registered, you could lose significant business.

No-deal Brexit

Once again, Brexit rears its ugly head. If you have an existing EORI number, you may still need to get a new one in the event of Brexit. As with other countries outside of the EU, a number containing the country code (in this case GB) will need to be used.

If your EORI number already starts with GB, likely because you trade outside of the EU, then you don’t need to reapply.

If you are only planning on trading in Ireland across the Northern Irish border you will also not require a GB-specific number. You will also not need to reapply if you don’t ship physical goods.

There will be a temporary grace period in which your original EORI number will still be valid but as demand may be high to process new applications, promptness in applying is likely to be the smart move.

If you already have an EORI number and it does not start with GB, you must apply for a GB EORI number.

Next steps

Up until now, it has been very straightforward to know whether you had a valid EORI number but with Brexit, many businesses may be caught out. If you are planning on expanding your e-commerce business outside of the UK, you must prioritise receiving your number.

If you’re unsure whether you need to apply or want someone to talk you through your EU trade options, please schedule a quick chat with one of our team.

Our e-commerce accountants are happy to advise and help you decide on the most strategic business plan for your business.

The best time to start is now.