Did you incur extra costs as a result of the United Kingdom (UK) leaving the European Union (EU)? If so, you may be eligible for compensation of these costs from the Brexit Adjustment Reserve for Enterprises, also known as the BAR. Compensation is available for costs incurred and paid between 1 January 2018 and 31 October 2022 in relation to customs training, advice, educational campaigns, and IT adjustments. Future costs may also be eligible for compensation. This scheme is available for a limited time only, so don’t hesitate with requesting your compensation!
As a result of Brexit, companies must adapt to the applicable customs legislation in the Netherlands and the UK, as well as requirements in the areas of inspection and certification of processes and products. This requires many adjustments. The BAR subsidises incidental Brexit-related external costs. The scheme consists of two parts, one for costs incurred and one for future costs. A budget of € 33 million is available for future costs to be incurred between 1 November 2022 and 1 June 2023. Applications must be submitted to the Netherlands Enterprise Agency (Rijksdienst voor Ondernemend Nederland or RVO) ultimately on 13 January 2023 (17:00 hrs) in order to make use of this scheme.
Conditions for subsidy for future costs
To be eligible for a subsidy for future costs, you must in any case meet the following conditions. You must:
be able to demonstrate that the relevant activities took place as a result of Brexit.
have been registered in the trade register of the Dutch Chamber of Commerce on 1 January 2021.
fulfill the customs requirements: you did not file customs declarations for the import or export of goods to a country outside of the EU from 2015 up to and including 2020, but have had to do so since 1 January 2021 as a result of Brexit.
have at least € 5,000 of the total 2020 turnover related to trading activities with the UK or trading activities with countries within the EU for which transport in or through the UK was required (with the exception of educational campaigns and trade facilitation companies).
Training costs?
For training costs resulting from Brexit and incurred in 2021, a subsidy may be granted, under the following conditions with regard to the maximum number of employees and the types of training:
1. If customs declarations are outsourced to third party:
Two employees for the training regarding customs procedures in practice
2. If customs declarations are done in-house in the category of so-called basic customs requirements:
Two employees for the basic customs training
One employee for the specialist customs training
3. If customs declarations are done in-house in both the categories basic customs requirements and so-called complicated customs requirements:
Two employees for the basic customs training
Two employees for the specialist customs training
The costs for the following training may be eligible:
Training regarding customs procedures in practice;
Basic customs training or comparable training;
Specialist customs training or comparable training; and/or
Training as phytosanitary control staff.
Adjustments to IT infrastructure
A subsidy may be available for customs declaration software or user licences for that software, and other products necessary for customs declarations. The scheme describes the conditions under which the costs incurred for adjusting the IT infrastructure may be subsidised. The investment may only be used in the specific (business) location for which the subsidy has been granted and must be considered a depreciable asset. The provider must be an independent third party. Additionally, the investment must remain part of the subsidy recipient’s assets for at least three years.
External advice?
Based on the BAR, advisory or consultancy costs can be subsidised if:
These costs were incurred in order to meet product and process requirements based on customs regulations as a result of Brexit;
The advice was provided by an external advisor;
The nature and scope of the advisory process is clearly specified and explicitly Brexit-related; and,
It concerns a clearly defined and one-off advisory process.
Trade Programme and subsidy for previously incurred (and paid) costs
The BAR also offers compensation for costs incurred (and paid) between 1 January 2018 and 31 October 2022. Additionally, the RVO offers support to businesses developing promising sales markets outside of the UK, in the form of the EU Trade Programme (EU Handelsprogramma). Read more about these two schemes in our previous article.
Questions?
Do you need any assistance in filing your application? Or would you like support in training your employees with regard to customs regulations of customs declarations? Please feel free to contact us. We would be happy to help.
The legislation and regulations in this area may be subject to change. We recommend that you discuss the potential impact of this with your Baker Tilly consultant.
