Do you hold stocks of imported goods in the UK?

If you hold stocks of imported goods in the UK, you may be able to achieve cash flow savings by postponing the time at which duty on importation is payable by using a customs warehouse.

Dated: 9 December 2020 Author: Terri Bruce, Director of Indirect Tax for SMEs and Not for Profits

Placing the goods in a customs warehouse delays the payment of the duty charges until the goods are removed from the warehouse.   If goods are re-exported, use of the warehouse can relieve the charges entirely, producing real cash savings.

A customs warehouse does not have to be a physical building as stock can be controlled through accounting and reporting systems.  Therefore it is possible to include stocks held at your customers’ premises under the warehouse regime and delay payment of duty until they are called off.

Please note that if you hold consignment stocks or call off stocks in European Member States you may be required to register for VAT to account for the supply of the goods after 1 January 2021.  This may require the appointment of a Fiscal Representative.

If you wish to apply to use a customs warehouse you will need prior approval from HMRC.

Additional savings may be achievable if you use other procedures such as Customs Transit or Inward processing Relief (“IPR”).

Useful Links:

• Brexit: VAT and Customs Advice Services
• Prepare your Business for Brexit (PDF)

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