The UK has now left the EU, and with it the EU Customs Union and Single Market.  These arrangements are replaced with WTO terms, the Northern Ireland Protocol and the Trade Co-Operation Agreement (TCA) being signed into law with effect from 1 January 2021.

The immediate customs impact will be:

The UK implementing its own customs regulations (we have moved from four pieces of customs regulation to over 40 and counting)

The UK implementing its own customs tariff, with some simplifications and duty rate reductions

Goods imported from the EU to the UK and vice versa will be subject to customs regulation, customs declarations, import VAT and customs duties

The UK losing the use of EU Free Trade Agreements and having to sign its own (many of these have already been struck but cannot necessarily be used in conjunction with each other or the UK/EU FTA)

A specific protocol exists for movement of goods between the rest of the UK and Northern Ireland (NI), including customs declarations on imports to NI and potential customs duties

Tariff and quota free access under the TCA for EU goods imported into the UK and vice versa if the origin list rules and other conditions are met

Disruption as some businesses are subjected to customs regulation for the first time and existing international businesses migrate to a new customs regime.

Further details of the TCA can be found here.

The customs regulations provide several options to mitigate customs declarations and customs duty costs if the TCA does not apply.

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UK Publications & Guidance

The UK Government is spending considerable resources on trying to keep business running including the imposition of temporary reduced tariff rates, simplifications, customs declarations for EU imports and the ability for businesses to pay and recover import VAT through their VAT returns.

Important Steps to Take

  1. Obtain an EORI (these are automatically being issued to VAT registered businesses);
  2. Obtain a Deferment Account (if subject to customs duties);
  3. Appoint a customs broker or agent;
  4. Determine all the necessary customs data elements (e.g., Classification, Origin and Valuation) for inclusion in your commercial records and subsequent customs declarations.

More details and be found on the UK Government website.

The UK has published its UK Global Trade Tariff and the Northern Ireland Tariff.  All goods going from the UK to Northern Ireland will be subject to the Northern Ireland Tariff unless they originate in the UK or are not “at risk” of onward movement to the EU.

Instead of cutting and pasting current EU Customs regulations into the UK woven a complex web of customs law, publishing two key primary pieces of legislation: the EU Withdrawal Act 2018 and the Taxation (Cross Border Trade) Act 2018, and a growing number of Statutory Instruments and draft notices that will have legal effect.

Failure to comply with these regulations can result in:

  • Collection of underpaid customs duties;
  • Penalties;
  • Goods being forfeited; and
  • Losing access to customs duty relief schemes and simplifications.
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Mitigation & Planning

The UK and EU Customs Regulations provide several options and elections for reducing the customs duty and customs declaration costs. It is necessary to obtain authorisations from the relevant customs authorities to take advantage of these regimes.

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How can we help?

We are on-hand to help with all of your customs need. Provide us with some details on your circumstances and one of our friendly experts will be in touch to provide support and advice.