Turning Goods into a Different Product Could Help to Reduce Your Duty Payable

If you import goods into the UK and apply a process to them, turning them into a different product you may be able to achieve duty savings by applying to use inward processing relief (“IPR”).

Dated: 25 November 2020 Author: Terri Bruce, Director of Indirect Tax for SMEs and Not for Profits

IPR may be of particular interest when the processed goods carry a lower duty rate than the rate applicable to the individual imported components.

In order to work out whether this could be a benefit to you, you should review the commodity codes for the component parts and that of the finished items.

If goods are re-exported after processing, duty will not be paid on the initial importation.

To claim IPR, an importer must be authorised by HMRC and a guarantee will be required. Strict record keeping requirements will apply.

Outward Processing Relief

Equally, if you send items outside of the UK for manufacture or assembly, you may be able to bring them back into the UK without payment of duty if you apply for Outward Processing Relief (“OPR”)

We can work with you to identify the cost/benefits of OPR and assist with implementation.

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