Importing goods into the UK

Since the UK left the EU customs union, goods moving between the UK and anywhere else cross a customs border. For a subsidiary importing from its own parent this is administrative rather than difficult, but it has to be set up before the first shipment, because goods that arrive without the right arrangements sit at the port accruing storage.

What has to be in place first

• An EORI number beginning GB. Without it the company cannot import or export at all. We apply for it alongside the VAT registration.
• A customs agent or broker to make the declarations. Very few importers make their own, and the ones that do have volume to justify the software.
• Commodity codes for what you are importing, which determine the duty rate. Getting the code wrong is a common source of an underpayment assessed years later.
• Origin. Where goods were made, not where they were shipped from, decides whether a trade agreement gives you a reduced or nil duty rate. Claiming preferential origin without the evidence to support it is a liability.
• Postponed import VAT accounting, so import VAT is declared and recovered on the same VAT return rather than paid at the border and reclaimed months later. This is a pure cashflow decision and there is rarely a reason not to use it.

Who is the importer of record

This is the question that causes the most trouble and it is decided by the Incoterms in your contract, often by someone who did not realise they were deciding it. If the UK company is the importer of record it deals with the declaration, the duty and the import VAT, and recovers the VAT on its own return. If you sell delivered-duty-paid and the customer is named as importer, your customer can end up holding your import VAT with no way to recover it, which is a commercial problem as well as a tax one. We look at the Incoterms before the contracts are signed rather than after the first shipment.

Duty deferment

A duty deferment account lets the company pay its duty and import VAT once a month by direct debit instead of consignment by consignment, which removes a delay at the border and smooths the cash. It requires a guarantee, or a waiver where the company qualifies. Worth it once volumes are regular, unnecessary before then, and we will say which applies to you.

Northern Ireland

Goods moving to Northern Ireland follow different rules from goods moving to Great Britain. Buzz has a Northern Ireland office and this is ordinary work for us rather than an exception, which is not true of every UK adviser.