The Brexit secretary's admission led to claims the government was breaching its commitments to allow "unfettered access" to the GB market for firms in Northern Ireland with new bureaucracy.
Appearing in front of the House of Lords European Union committee, Mr Barclay initially said he did not believe the forms would be necessary as trade would be "frictionless".
But clarifying himself minutes later, he told peers: "Just to be clear, exit summary declarations will be required in terms of NI to GB".
Responding to the remarks, the DUP's Brexit spokesperson Sammy Wilson, said it was a "clear breach" of the government's commitment to "allow unfettered access to GB market for NI businesses".
"How can any Conservative & Unionist MP argue this does not represent a border in the Irish sea?!" Mr Wilson added.
Nigel Farage, the Brexit Party leader, also weighed in, adding: "It is now clear Boris Johnson is prepared to wreck the United Kingdom to get this EU treaty through. No wonder the DUP are unhappy."
After quizzing Mr Barclay on the exit declarations, Labour peer Stewart Wood told Politico: "The Brexit secretary of state has made clear that there will be a very commercial border between Northern Ireland Great Britain under the government's Brexit proposal.
He said it was "fanciful" that Northern Ireland companies would continue to enjoy unfettered access, adding: "In conceding all firms will need to complete declarations when their good travel to Great Britain, he has revealed that trade inside the UK will be subject to new rules and new paperwork."
People's Vote supporter and Labour MP Ian Murray said Mr Barclay's comments represented a "shocking admission".
He added: "This would mean extra costs and bureaucracy for businesses in Northern Ireland, which will cost jobs. The DUP are just the latest people to learn that Boris Johnson's relationship with the truth is extremely flexible, to say the least."