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Customs Updates - Do not Let the Small Print Throw You


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5th June 2013

Two recent EU cases highlight the need to ensure all procedural matters are followed where Customs Reliefs are used and that not to be aware of these can be costly.

In both cases whilst there was no doubt that the purpose of the reliefs had taken place, namely that goods had been re-exported, but because the business in question had not strictly followed the procedures laid down in EU law, duty and VAT relief were denied. This seems somewhat harsh but is an EC Commission directive so it is worth ensuring any import / export business is fully aware of what is required.

In the first case, a business imported, processed and re-exported goods using the Simplified Inward Processing Relief (IP) which suspends duty and import VAT. However, one of the conditions of simplified IP is that a bill of discharge notice has to be sent to HMRC’s NIRU in Ennisklillin within a specified period, usually 30 days after a 6 month period following import. The European Court of Justice has ruled in the case of Dohler Neuenkirchen GMBH that as this had not been done, duty and VAT was due on all goods even they it could be shown that they had otherwise been correctly re-exported.

In the second, Eurogate Distribution operated a Customs Warehouse and although re-export documents were correctly drawn up at the time goods were removed from the Customs Warehouse, as Eurogate had not updated its stock records in a timely fashion, duty and VAT relief were denied.

The moral of both cases is to be fully aware of the procedural requirements and ensure they are acted on.

 Customs Director, David Miller .

About the Author

The VAT People are leading VAT and Customs Duty consultants based in the North West of England. We work with a wide range of businesses throughout the UK as well as assisting our accountancy colleagues to unravel the thorny VAT issues for their clients. We are one of the UK's largest and most comprehensive sources of VAT and Customs advice, our consultancy team having over 140 years of experience in VAT and Customs gained in either HMRC or a Big 4 accountancy practice environment.

Call us on our VAT helpline 0800 077 4604 to discuss. All initial discussions are free with no-obligation.

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Article Published/Sorted/Amended on Scopulus 2013-06-17 13:09:14 in Tax Articles

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