How N.Ireland changes when Brexit transition ends

How Northern Ireland changes when Brexit transition ends

Credit: iStock photo.

Northern Ireland will be subject to unique arrangements on tax, borders and trade when the Brexit transition period ends on December 31.

London and Brussels agreed on the plan -- separate to the talks on a post-Brexit trade deal -- to prevent a hard border between the province and EU member Ireland. The frontier became a flashpoint during more than two decades of violence over British rule of Northern Ireland.

Here is what will change:

Under the special arrangements, Northern Ireland will align with the EU's single market regulations and the customs union.

This means from January 1 goods arriving in Northern Ireland from mainland Britain (England, Scotland and Wales) will be travelling within the UK while in effect crossing the EU-UK border.

A pact between Brussels and London aims to minimise port checks and disruption on goods bound for Northern Ireland as their final destination.

But freight scheduled to travel onwards to Ireland or any other EU member will be subject to the same controls as all UK-EU trade, with checks taking place at Northern Irish ports and airports.

Under the "Northern Ireland protocol", agricultural foods arriving in Northern Ireland from mainland Britain will require new paperwork and checks starting in 2021.

London and Brussels recently agreed a "grace period" until April 1 for supermarkets and suppliers to prevent disruption to food stocks, as officials warned port will not be ready to handle the checks.

The deal to minimise disruption on freight bound for Northern Ireland from mainland Britain means most goods will not face tariffs.

However, businesses will need to register for a "trusted trader scheme", declaring that Northern Ireland is its final destination.

"The scheme will be open only to businesses established in Northern Ireland, or businesses who meet certain closely linked criteria," the UK government said.

EU value-added tax (VAT) law will continue to apply in Northern Ireland.

The British government has said it will apply "on goods moving to, from and within Northern Ireland".

However, the province will remain part of the UK's VAT system, which firms will use to reclaim tax on trade with EU companies.

While Northern Ireland will remain a part of the United Kingdom, it will be able to continue unfettered trade with the Republic of Ireland and other EU member states from January 1.

This will remain true whether or not Britain and the EU seal a wider deal on their future trading relationship.

Some have suggested it may give business in the province an edge over mainland British counterparts.