Beginners Guide To UK Customs Duties

Introduction

The UK's departure from the EU could mean that an entirely new set of rules may apply to imports and exports. The Taxation (Cross-border Trade) Act 2018 gives the Government the ability to establish a stand-alone UK customs regime. However, it is expected that the rules of such a regime will be closely based upon the existing EU rules. This guide sets out a simple overview of how the current rules work. We will update this guide as the situation develops.

The UK is currently part of the EU Customs Union. This lays down a set of rules (the Union Customs Code) for dealing with imports from and exports to non-EU countries, as well as ensuring that no customs duties apply on imports and exports within the EU.

What are customs duties?

Customs duties are taxes imposed on the import and export of goods. The rates of customs duties and the procedures involved vary according to the goods involved, and international agreements between the relevant countries.

As well as customs duties, you may have to pay import VAT when importing goods to the UK at the relevant rate of VAT for the goods in question (the standard UK VAT rate is currently 20%).

In addition, duties such as excise duties (charged on particular goods such as alcohol and cigarettes) and anti-dumping duty (a high rate of duty imposed in order to discourage countries from subsidising or dumping goods into the UK market) may be imposed.

How to make a customs declaration

The key step in the process for a person importing goods into the UK is to make a customs declaration. This can be done by completing a Single Administrative Document (form C88), which is most commonly done electronically. The form will set out:

what the goods are how much they are worth where the goods are moving from and to the commodity code for the goods the Customs Procedure Code (CPC) - which determines how customs treat your entry Most businesses will use a courier or freight forwarder to make customs declarations for them. It is possible to make your own customs declarations but the process is complicated and suitable only for more experienced importers.

The commodity code determines the applicable rate of customs duty and import VAT (if any). It is therefore critical to ensure that you apply the correct commodity code to any goods you import into the UK. The UK Trade Tariff lists customs classification codes (based on the EU's Combined Nomenclature).

If there is any uncertainty on the code, it is possible...

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