Deferment or postponed VAT accounting is a mechanism that allows businesses to defer payment of VAT on imports until they file their periodic VAT return, rather than paying upfront
This can provide significant cash flow benefits. In the Netherlands, a foreign entity can appoint a tax representative in the importing country to represent their business with the Tax and Customs Administrations and use their VAT number and Article 23 import license to take advantage of deferred VAT at import.
To do so, the business must have an Article 23 permit, which can only be obtained through a limited tax representative.
In the UK, a business must be registered for VAT to use postponed VAT accounting. If a business is not VAT registered in the UK, it will need to appoint a representative to handle VAT on its behalf.