Suspending payment of import taxes
A Customs Warehouse allows organisations to store goods with duty or import VAT payments suspended.
Duties must be paid when goods are removed from the warehouse unless they are re-exported or moved to another Customs procedure.
There are two types of Customs Warehouse: Type R (Public) & Type U (Private)
You must be authorised by HM Revenue and Customs (HMRC) to run a Customs Warehouse.
As a Customs Warehouse-keeper, your responsibilities will include:
• Establishing stock records and maintaining them for a minimum of four years
• Checking goods upon arrival into the Customs Warehouse & notifying HMRC of any shortages or surpluses
• Ensuring adequate security measures are in place to protect both goods & records
• Making sure the Customs Warehouse meets Health & Safety standards
• Providing HMRC with access to your warehouse, goods in storage & records
You can store goods in a Customs Warehouse if:
• You want to hold the goods without paying Customs duties and/or import VAT until you are ready to move them again
• Goods are being moved from another EU country but import taxes have not yet been paid
Goods can be placed into a Customs Warehouse if:
• You don’t know the final destination of the goods when they arrive into the UK
• Import paperwork has been delayed, or you are waiting for a duty-relief quota to become available
To qualify as a warehouse-keeper, your business must:
• Prove that there’s an economic need and you have enough clients or business to run the warehouse
• Be able to comply with the conditions of the Customs Warehouse authorisation
• Provide a financial guarantee (CCG) to cover potential Import Duty and VAT liabilities
The Benefits of Customs Warehousing
As an importer, the main benefit of operating a private ‘Type U’ Customs Warehouse is not having to pay Customs duties and/or import VAT until you have to.
There is no time limit on how long you can hold goods in a Customs warehouse, and when you do remove goods, they can be removed in quantities appropriate for your business requirements.
As a Customs Warehouse keeper, operating a public ‘Type R’ warehouse allows you to offer an off-quay storage facility to importers who require additional time before paying Customs duties and/or taxes, but who want to avoid high quay rent and demurrage charges. This could be for a number of reasons, such as awaiting commercial paperwork, quota, or that the goods are not required yet.
Multi-site facilities can be covered under one authorisation, and there is no requirement to separate duty suspended stock from free-circulation stock providing adequate stock systems are in place.
Detailed records must be maintained in order to comply with the record keeping requirements. For importers this aspect can be particularity complex but there are a number of businesses who have developed software solutions to assist with this. We will be happy to provide details of those we recommend upon request.
How VARTAN can help you
VARTAN will assess whether Customs Warehousing is beneficial and appropriate to your organisation.
We will work with you to implement sustainable systems ensuring the required procedures and checks are practical and easy to maintain for ongoing compliance.
We can assist you with preparing and presenting your application to HMRC. In addition, we offer regular auditing services for additional ongoing support.
We can also offer assistance in applying for a Customs Comprehensive Guarantee (CCG). Under current legislation you need to hold a valid CCG to operate a Customs Warehouse, however organisations with AEO-C status are entitled to a reduction or waiver of the guarantee amount.
Our expert knowledge will help ensure your company has the correct policies, procedures and audit trails in place before submitting the application, leading to a successful audit by HMRC and a successful outcome to your submission to become authorised for Customs Warehousing.
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