Tag Archives: CDS

VAT & Customs Duty: Goodbye CHIEF, hello CDS

By   23 August 2022
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Businesses who import into the UK currently use Customs Handling of Import and Export Freight (CHIEF) to declare goods.

There is also a separate scheme running concurrently, known as Customs Declaration Service (CDS).

From 1 October 2022 CHIEF will cease and importers must use CDS.

Exports

CHIEF is also currently used for exports and this will continue to a later date of: 31 March 2023.

Action

This change will significantly affect all businesses which import goods. Although it is likely that import agents will handle the majority of issues, an importer will be required to:

Failure to comply with these requirements will result in a business being unable to import goods.

Customs Declaration Service (CDS) – Update

By   23 October 2018
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As many will be aware, CDS will fully replace the Customs Handling of Import and Export Freight (CHIEF) system later this year/early next year, full details here.This will affect any business which imports or exports goods from or to countries outside the EU (and possibly will affect businesses which trade with the EU in the event of a No Deal Brexit).

HMRC have provided more information on the implementation of CDS.

They say that the number of businesses making declarations via CDS will grow over coming months. If you have not been contacted by HMRC then your business is not part of this first group. The time your business begins using CDS will depend on its(or its agent’s) software developer or Community System Provider. HMRC expect remaining importers will start to move to CDS early in the New Year. Exporters will migrate to CDS when export functionality becomes available in March 2019. This means that CDS and CHIEF will run in parallel for a short period of time. Import declarations will be made in CDS whilst export declarations will continue to be made in CHIEF.

Not an ideal situation, but it does seem prudent to phase CDS in in this way.

Checklist

  • Visit Customs Declaration Service to understand how the changes affect your business and what you will need to do to prepare for the introduction of CDS and when. This includes making sure you have a Government Gateway account and an EORI number.
  • A new Trade Tariff will be used for declarations on CDS to comply with the Union Customs Code (UCC) so it is important you take the time to understand how the information you provide as part of your declarations will change. The imports tariff can be found on the link above. The exports Tariff will be available later in the year.
  • If you use a software provider or agent, you may also want to check they are aware and are preparing for the new CDS.
  • If you use a C88 form or the National Export System to make declarations, please visit the web page above where you can find more information.

If you have any queries we will be pleased to help.







Changes to the import of goods

By   10 August 2018
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If a business imports goods from countries outside the EU, there are changes being made by HMRC which it needs to beware of. If a business currently uses the UK Trade Tariff to make Customs declarations it will be affected by these changes.

The changes are set out here for imports. We understand that the changes for exports will be made available later in the year.

If a business’ agent or courier completes its declarations on its behalf, it may be prudent for a business to contact them discuss the impact of the changes.

Background

An overview of the changes may be found here

And a general guide to importing here

Why is the Tariff changing?

HMRC is phasing in the new Customs declaration Service (CDS) here from August to replace the current Customs Handling of Import and Export Freight (CHIEF) system. As well as being a modern, digital declaration service, CDS will accommodate new legislative requirements under the Union Customs Code UCC here In order to comply with the UCC, a business will need to provide extra information for its declarations which can be found in the tariff.

When will a business be required to use the new Tariff?

The majority of importers will start using CDS after November 2‌018, once their software provider or in-house software team has developed a CDS compatible software package. Some importers will start making declarations on CDS before this, but there is no action for a business to take unless it has been contacted by HMRC to be part of this group.

Brexit

As is very common with Brexit, it is unknown how the UK leaving the EU will affect this position. With a No-Deal Brexit seeming likely, the above rules are likely to apply to goods brought into the UK from other EU Member States after next March.

Please contact us should you have any queries.







Imports – The jargon explained

By   1 March 2018
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The minefield of importing

VAT is only one consideration when importing goods.

Further to my article on proposed changes to imports and exports I have been asked what some terms used in the import of goods mean. So below is, what I hope, a helpful explanation of UK import terms.

We are happy to assist with any general queries and we provide a comprehensive Customs Duty service via our associates with specialised, in-depth knowledge of this complex area.

We recommend regular reviews of a business’ import procedures. This may highlight deficiencies but also provide opportunities to save money or improve cashflow.

Term Description
Anti-Dumping Duty A customs duty on imports providing a protection against the dumping of goods in the EU at prices substantially lower than the normal value
ATA carnet An international customs document for temporary importation and exportation regulated under the terms of the ATA or Istanbul Convention
C 88 (SAD) The UK version of the Single Administrative Document (SAD) for making import, export and transfer declarations
CAP Common Agricultural Policy
CDS Customs Declaration Service to be launched from August 2018. Replaces CHIEF
CFSP (Customs Freight Simplified Procedures) Simplified procedure for the importation of third country goods including the simplified declaration procedure and local clearance procedure
CHIEF (Customs Handling of Import and Export Freight). The Customs entry processing computer system. Soon to be replaced
CIE Customs input of entries to CHIEF
Community Member States of the European Union
Community Transit A customs procedure that allows non EU goods on which duty has not been paid to move from one point in the EU to another
Countervailing duty A customs duty on goods which have received government subsidies in the originating or exporting country
CPC (Customs Procedure Code) A 7-digit code used on C88 (SAD) declarations to identify the type of procedure for which the goods are being entered and from which they came. Details of CPCs can be found in The Tariff
Customs charges customs duties
import VAT
specific customs duty (previously CAP charges)
Anti-Dumping Duty
Countervailing Duty
excise duties
Customs duty An indirect tax that provides protection for Community industry. Raised on imported goods, it does not include excise duty or VAT
Customs warehouse A system or place authorised by customs for the storage of non-Community goods under duty and/or VAT suspension
EU European Union
EU Country Member country of the European Union
Euro (€) European currency unit
Excise duty A duty chargeable, in addition to any customs duty that may be due, on certain goods listed in The Tariff, volume 1 part 12 paragraph 12.1
Free Circulation Goods imported from outside the EU are in free circulation within the EU when:

all import formalities have been complied with

all import duties, levies and equivalent charges payable have been paid and have not been fully or partly refunded

goods that originate in the EU are also in free circulation
Free Zone A designated area into which non-EU goods may be moved and remain without payment of customs duty and/or VAT otherwise due at importation
INF6 (C1245) Information sheet 6 is a document used when TA goods travel between EU Countries. It provides details of the goods at the time of their first entry to TA in the EU. It does not replace the C88 (SAD)
IP (Inward Processing ) A customs procedure providing relief from import duty on goods imported to the EU or removed from a customs warehouse, for process and export outside the EU
Member State Member country of the European Union
PCC (Processing under Customs Control) A system of import duty relief for goods imported or transferred from another customs regime for processing into products on which less or no duty is payable
Person established in the EU In the case of a natural person, any person who is normally resident there.

In the case of a legal person or an association of persons, any person that has, in the EU:

its registered office
its central headquarters
or
a permanent business establishment
Person established outside the EU In the case of a natural person, any person who is not normally resident there.

In the case of a legal person or an association of persons, any person that has, outside the EU

its registered office
its central headquarters
or
a permanent business establishment
Pre-entry Notification to customs of your intention to export the goods by the submission of an entry
Preference Arrangements which allow reduced or nil rates of customs duties to be claimed on eligible goods imported from certain non-EU countries
SAD (Single administrative document) Document used throughout the EU for making import/export declarations – the UK version is Form C88
TA goods Temporary Admission goods
Tariff The Tariff consists of 3 volumes

Volume 1
contains essential background information for importers and exporters, contact addresses for organisations such as Department for Business, Innovation and Skills, Department of Environment, Food and Rural Affairs and Forestry Commission. It also contains an explanation of Excise duty, Tariff Quotas and many similar topics

Volume 2
contains the 16,000 or so Commodity Codes set-out on a Chapter by Chapter basis. It lists duty rates and other directions such as import licensing and preferential duty rates

Volume 3
contains a box-by-box completion guide for C88 (SAD) entries, the complete list of Customs Procedure Codes (CPCs), Country / Currency Codes, lists of UK ports and airports both alphabetically and by their legacy Entry Processing Unit (EPU) numbers, and further general information about importing or exporting.

The Tariff is available on an annual subscription and is also available at some larger libraries. You can buy the Tariff in printed and CD ROM formats or subscribe to the new e-service from the Stationary Service referred to in paragraph 1.5
Third country Any country that is outside the Customs Territory of the EU

It is likely that some of these terms will change in the future and with the uncertainty of Brexit who knows what changes will be required.







VAT: HMRC announce changes to import and export procedures

By   21 February 2018
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People get ready.

HMRC have announced that long overdue changes have been made to the Customs Handling of Import and Export Freight (CHIEF) system.

It has been developing a new system for processing customs declarations for imports and exports. The current system; CHIEF will be replaced by the Customs Declaration Service (CDS).  A phased launch of CDS will begin from August 2018.

Why CDS is replacing CHIEF

CHIEF is one of the world’s largest and most sophisticated electronic services for managing customs declaration processes, but it’s nearly 25 years old and can’t be easily adapted to new requirements.

The decision to replace CHIEF with CDS was made before the EU referendum however CDS will be scaled to handle any potential increases in the volume of declarations that may result from the UK’s exit from the EU.

How this will affect importers and exporters

If a business imports goods into, or exports goods to outside the EU, it (or its agent) will be currently using CHIEF to:

  • process declarations for goods entering and leaving the UK or EU through ports and airports
  • calculate and pay the correct duty and taxes
  • complete customs information electronically.

You will still be able to do these things on CDS, but there will be differences:

  • CDS will be accessed on G‌OV‌.U‌K through a Government Gateway account
  • CDS will offer several new and existing services in one place – for example, it will be possible to: view previous import and export data on pre-defined reports, check the tariff, apply for new authorisations and simplifications, and check a business’ duty deferment statement
  • online help will include self-service tools, guides and checklists
  • some additional information will be required for declarations in order to align with the World Customs Organisation Kyoto Convention, currently being implemented in the UK through the Union Customs Code (UCC).

When will a business need to start using CDS?

CDS will be phased in between August and early 2019, with CHIEF continuing to run during this time to aid the transition. A business or its agent will be informed by its software provider when it needs to provide the additional information in order to start making declarations on CDS.

HMRC has stated that it will keep businesses updated as the system develops. There will also be regular updates about CDS on GOV.UK.

Please contact us if you have any queries on this change.