What is happening
Effective January 1, 2021, the United Kingdom (UK) will exit from the European Union (EU). As part of the Brexit Withdrawal Agreement, the UK and EU agreed that Northern Ireland would take up a dual status within the EU and UK VAT, customs union and market for goods only.
Northern Ireland will enter into a special VAT and customs relationship with the EU and operate under EU VAT regulations with regards to goods, but not services or digital services. For more information, see UK clarifies Brexit Northern Ireland ‘XI’ VAT number.
If your business or customer is transacting in Northern Ireland, you will need to update addresses before January 1, 2021, including changing your ISO country code from UK to XI; the new Northern Ireland ISO country code is XI. You need to make this update to ensure proper calculation processing.
NOTE: Do not submit Northern Ireland as a separate country in transactions until January 1, 2021.
What you need to do
Update addresses in two places
- Update addresses in your business systems. To ensure transactions under the Northern Ireland protocol are calculated correctly, separate Northern Ireland to use ISO code XI from UK/GB. (XI is the prefix adopted by UK and EU for Northern Ireland).
- In AvaTax: Update addresses in Company Locations. If locations are set up with a Northern Ireland address, the Country may need to be updated to XI, the new Northern Ireland ISO code.. For instructions on how to do this, see Edit company locations.
NOTE: Do not submit Northern Ireland as a separate country in transactions until January 1, 2021
Update where you collect and pay tax (nexus) in AvaTax
- Update nexus in AvaTax on 12/18/2020 to include Northern Ireland. (12/18/2020 is when the Northern Ireland nexus option will be available in AvaTax.)
- NOTE: Do not submit Northern Ireland as a separate country in transactions until January 1, 2021
- For information on updating nexus, see Update where you collect and pay tax.