HMRC Import declarations - confused?

[paulears]

Please forgive me for asking what must be stupid questions but I got a letter from HMRC today about making customs declarations - either myself or via a customs agent. It links to how to videos, but even after watching them, I'm left pretty confused.

From the videos - it looks like these customs declarations are to do with importing from the Island of Ireland into the UK, while the protocols are being looked at.

The letter does not mention Ireland at all? but suggests searching for customs declaration service and a declarant checklist. It talks about CHIEF (no idea) and CHIEF declarations and Customs Declaration Service declarations. Even more confused now. The 'how to' videos assume you know what they're talking about.

I don't import anything from Europe, apart from a few items from Germany, but these were invoiced with a GB VAT number - I treated this as any other purchase, not an import. I buy some items for resale from China, so these are imports - but they turn up in the post via UPS or Fedex, and most have VAT charged which I pay to them and then that eventually gets recovered in the VAT return.

Should I be doing some kind of import documentation? I'm not - didn't know I had to - or have I misunderstood and it's just Europe and the Brexit mess? I can't see that the customs declaration service is relevant to me as I don't import from the EU - I'm a sole trader, if that makes any difference, so although most of my imports are for stock, a few are used by me at home.

The HMRC letter is centred about import declarations, and the change to the new service. As I have never made any declarations of any kind, have I messed up here - nobody has ever mentioned declarations to me?

 

[japancool]

CHIEF was the old import declarations system. This is being replaced at the end of this month by CDS.

You need to sign up for CDS via Government Gateway. Once you do that, all you need to do should be to authorise your import carrier to make declarations on your behalf and everything should work like it does before.

At least, this is my understanding of it.

Which reminds me, I need to get off my arse and do it tomorrow.

 

[paulears]

But that's the snag - I don't even know who the carrier is until the goods arrive, and very often they are dropped off next door - so I don't know who delivered them? The goods just get sent from China, and appear here? I wouldn't have a clue how to make a declaration? Maybe Fedex, UPS, DHL, Royal Mail already do it? A total mystery as to how they actually appear. The parcels usually have labels that don't even say who sent them? Loads of times I get parcels for the same brands and models from different suppliers? I've never made a declaration to do with foreign goods? Just a stream of parcels under 2Kg normally that just roll in.

 

[LPB 123]

The courier will be making the declarations on your behalf so you dont need to do anything.

For sea freight, if your forwarder makes the declarations on your behalf and then invoices you for VAT / duty then again nothing will change. I think you only need to register for CDS if you do your own declarations which is unlikely for small businesses.

 

[paulears]

Thanks. I just didn’t find any info that fit. That makes sense, most appreciated.

 

[WaveJumper]

Well blow me my son had one of these letters yesterday like you only has the odd parcel from foreign parts makes you wonder how much HMRC are spending on postage when perhaps an email may have done the job.

 

[Newchodge]

If you are making a purchase from Germany, you are importing from the EU.

 

[Ray272]

Paul, firstly, thanks for your honesty on this matter. I too cannot get my head around it, just today I was watching a video and making notes and I found this service Customs-Declarations.uk and to fully understand this process I thought their PAYG option would be a good place to begin.

£25 for a declaration one off fee. The problem I noted was their service does not account for Air Freight.

I have a hard time understanding why they have made one video to account for multiple modes of transport and then when I see some companies who have got in on this early do not even offer Air Freight.

Sorry to say but have we not had an issue like this before, was there not a major backlog with the EU ports due to these new changes when brexit occurred and again it does appear they are heading for something similar.

If I knew what to do, I would help everyone, surely that is the point of this forum so I am working on this now and I will make the painful call in 10 minutes to HMRC and find out. HMRC I find, are extremely helpful if they know about the process but this to me looks like the blind leading the blind and I do not expect HMRC Staff to fully understand this, as it is so new. I believe they will extend the transition period once they see all the problems. Similar to previous incidents once the transitions tried to take effect.

I will keep updating here, my concerns are specifically how to handle imports using Air freight which is contracted and uncontracted by us. - Uncontracted meaning the supplier handles the air freight booking etc, on our behalf.

 

[paulears]

I've got a bit further and it does seem that using the usual couriers falls under their system. The Royal Mail and UPS both require the sender to enter the details for customs declarations for exit from a country. However, the end customer has no control whatsoever over the source of the parcels. This morning four parcels arrived - One is identifiable as UPS, however the other three have the usual white declaration sticker, but nothing to say who delivered it. Ring video shows Royal Mail and a white van man. Which is which is impossible to tell, the declared values on the parcels have values higher than I paid and 'electronic goods' while a valid description, doesn't help identify who sent it. Worse, the suppliers details is a Chinese firm I have never heard of. The contents show it came from one of two suppliers - a safety net purchase of the same item from two sources, so I do not know which parcel is here and which is still to come. I simply do not have any information that would allow me to declare anything useful!

 

[Ray272]

A total of 94 minutes of call time spent trying to find out more information, there are multiple options on the automatic options, one of those is CDS. What I have learned today is no such department exists and the option just goes to the General Enquiries desk and whilst the 2nd person was helpful, he was honest enough to indicate they also have no real understanding of this process.

There is an email they provided which I am going to try but one thing is clear from the guy I spoke to, my query is not uncommon, and they are handling hundreds and thousands of the same type of queiries every day.

The best bit of advice they provided, which made me laugh a bit, maybe try contacting UPS and find out what they think. lol

The email:

[email protected]

 

[DefinitelyMaybeUK]

I would echo @japancool advice to apply for CDS as part of your HMRC account. While you may never have to make declarations yourself, it does then allow you to view statements of all the postponed VAT figures that you have been billed but not actually paid (and would be reclaimed anyway). You are supposed to enter these on your VAT return, but I think we've been through this before

 

[DanH]

Yep, we're none the wiser too and no one seems to know exactly what is going to happen or what the process is from our freight forwarders through to DHL...

 

[Ray272]

I have just signed up, was super easy, but it strikes me as odd that that I cannot see anything updating on my gateway. I had the email within 30 minutes of applying and was informed my application has been successful. I would have thought this would mean a new category in my Gateway to review, handle, manage this system. Nothing there.

So, I went back to reading the silly information for this and the thing that seems to be clear to me is this is all about actual SHIPPING and nothing to do with any other form of import. If it is about Air Freight it would stipulate that, but the only mode of transport I can see in their details is relating to VESSELS.

 

[DefinitelyMaybeUK]

I cannot see anything updating on my gateway

Have you tried this:

https://www.tax.service.gov.uk/customs/payment-records

 

[japancool]

I went to sign up but apparently, I already have access to CDS.

 

[Ray272]

Dear Forum, this DefinitelyMaybe guy just above just solved an issue for me, I believe I joined this forum in 2017 and I have never received any useful help, until today. Thanks Liam, much appreciated. I do try to help others too so stick with this forum please as we need more like you.

 

[Ray272]

I went to sign up but apparently, I already have access to CDS.

go to the link the guy mentions, sounds like you have already registered, and you just need to go to that link to see your CDS account. https://www.tax.service.gov.uk/customs/payment-records

Sign in if not already using your Gateway details.

 

[Ray272]

Please all readers look at Post Number 4 on this thread, I think the guy is right but, in any event, maybe best to just register, just in case.

 

[Indietrader]

I started a thread on all of this some months ago and spent a lot of time trying to figure out what was going on. I basically went through the exact process Ray has been through. I also registered for the CDS and managed to log in but there was absolutely nothing there after all of my efforts. I also found a notice on the HMRC website at one point that said something along the lines of, "people are reporting none of their documents are showing on the CDS website; therefore could they please make up the figures by estimating them on their returns and they can correct them at a later date" !!!! I went on HMRC live chat after this and, as Ray said, I was told by the person on there that none of this applies to air mail parcels and I need not worry about it. They literally said at one point you don't need to do any of this at all, it's for major importers, so I screenshotted their remarks and have saved them to produce if questioned and am not doing anything further. As far as I am concerned all of this does not apply to me or that is what I have been told by an HMRC representative. My one further issue is that the discussion I had with HMRC related solely to air freight imports but I have on occasion in the past imported by ship. It seems that importing by ship is a whole different ballgame - at least that is how I understand it - and a broker is now needed to complete the CDS documentation. The shipment can be returned to sender without the correct documentation and one of my suppliers has already mentioned this and that they will not refund if this happens. So basically I have had to make the decision not to import by ship any more because I doubt it would be worthwhile once the cost of the broker was factored in as I run a small business and also I do not know any reputable brokers or how the system works. As I see it HMRC have restricted me from expanding my import activities and are making it more difficult if not impossible for many, many small businesses. A lot of people are currently blaming Brexit for a reduction in imports but I feel at least part of this reduction is simply the result of Government incompetence as they seem unable to clearly spell out to traders what they want us to do.

 

[DefinitelyMaybeUK]

I also found a notice on the HMRC website at one point that said something along the lines of, "people are reporting none of their documents are showing on the CDS website; therefore could they please make up the figures by estimating them on their returns and they can correct them at a later date" !!!!

Yes, and that advice is still there:

Completing your VAT Return to account for import VAT

Find out how to complete your VAT Return to account for import VAT if you're using postponed VAT accounting.

www.gov.uk

For non-VAT registered folk, then it clearly doesn't apply, but otherwise HMRC are saying what needs to be filled in. The figures used should be: 1/ actual - as paid directly to a courier which you get a C79 for; 2/ actual - as per your postponed VAT statement; 3/ estimated - based on what you're importing where the postponed VAT report has gone astray (!) For 1 & 2, both these should/will eventually appear on the CDS login page:

https://www.tax.service.gov.uk/customs/payment-records

While you'll obviously want to claim back VAT on your return for case 1, it could be seen as academic that for cases 2 & 3 you didn't bother to fill in boxes 1 & 4 so they cancel out - but HMRC may take a different view ?

 

[Ray272]

I started a thread on all of this some months ago and spent a lot of time trying to figure out what was going on. I basically went through the exact process Ray has been through. I also registered for the CDS and managed to log in but there was absolutely nothing there after all of my efforts. I also found a notice on the HMRC website at one point that said something along the lines of, "people are reporting none of their documents are showing on the CDS website; therefore could they please make up the figures by estimating them on their returns and they can correct them at a later date" !!!! I went on HMRC live chat after this and, as Ray said, I was told by the person on there that none of this applies to air mail parcels and I need not worry about it. They literally said at one point you don't need to do any of this at all, it's for major importers, so I screenshotted their remarks and have saved them to produce if questioned and am not doing anything further. As far as I am concerned all of this does not apply to me or that is what I have been told by an HMRC representative. My one further issue is that the discussion I had with HMRC related solely to air freight imports but I have on occasion in the past imported by ship. It seems that importing by ship is a whole different ballgame - at least that is how I understand it - and a broker is now needed to complete the CDS documentation. The shipment can be returned to sender without the correct documentation and one of my suppliers has already mentioned this and that they will not refund if this happens. So basically I have had to make the decision not to import by ship any more because I doubt it would be worthwhile once the cost of the broker was factored in as I run a small business and also I do not know any reputable brokers or how the system works. As I see it HMRC have restricted me from expanding my import activities and are making it more difficult if not impossible for many, many small businesses. A lot of people are currently blaming Brexit for a reduction in imports but I feel at least part of this reduction is simply the result of Government incompetence as they seem unable to clearly spell out to traders what they want us to do.

This wall of text is well worth the read, as a small business I sometimes think like Paul Ears stated. 'I know this might be a stupid question' I think this because I believe I do not know what is going on and I must have it wrong as how could the UK Government have made this such a difficult matter to understand?

Just to confirm how easy this would have been:

Are you a business importing goods?

If you import using Air freight or via Road, you're ok, you can go now.

If you are using freight forwarders, shipping companies and the like and importing goods using a vessel. you're not ok.

thanks to all who made this a group effort, we only have 2 days to go before we see some action, I do have an Air import coming from Korea so hopefully will come after 30th and if all normal, will report and confirm.

 

[LPB 123]

If you are using freight forwarders, shipping companies and the like and importing goods using a vessel. you're not ok.

For most small businesses who use freight forwarders they won't need to use CDS, unless they use postponed VAT or have a duty deferment account etc. I would lmagine that most small businesses that import by sea, like us, have the forwarder complete the declaration using CDS and then invoice the business in the same way couriers do.

Here's the guidance: https://www.gov.uk/guidance/appoint-someone-to-deal-with-customs-on-your-behalf

 

[Newchodge]

I started a thread on all of this some months ago and spent a lot of time trying to figure out what was going on. I basically went through the exact process Ray has been through. I also registered for the CDS and managed to log in but there was absolutely nothing there after all of my efforts. I also found a notice on the HMRC website at one point that said something along the lines of, "people are reporting none of their documents are showing on the CDS website; therefore could they please make up the figures by estimating them on their returns and they can correct them at a later date" !!!! I went on HMRC live chat after this and, as Ray said, I was told by the person on there that none of this applies to air mail parcels and I need not worry about it. They literally said at one point you don't need to do any of this at all, it's for major importers, so I screenshotted their remarks and have saved them to produce if questioned and am not doing anything further. As far as I am concerned all of this does not apply to me or that is what I have been told by an HMRC representative. My one further issue is that the discussion I had with HMRC related solely to air freight imports but I have on occasion in the past imported by ship. It seems that importing by ship is a whole different ballgame - at least that is how I understand it - and a broker is now needed to complete the CDS documentation. The shipment can be returned to sender without the correct documentation and one of my suppliers has already mentioned this and that they will not refund if this happens. So basically I have had to make the decision not to import by ship any more because I doubt it would be worthwhile once the cost of the broker was factored in as I run a small business and also I do not know any reputable brokers or how the system works. As I see it HMRC have restricted me from expanding my import activities and are making it more difficult if not impossible for many, many small businesses. A lot of people are currently blaming Brexit for a reduction in imports but I feel at least part of this reduction is simply the result of Government incompetence as they seem unable to clearly spell out to traders what they want us to do.

If you put some paragraphs into your post it is more likely to be read.

 

[Ray272]

If you put some paragraphs into your post it is more likely to be read.

It has already been read; you can see that by the way of responses.

 

[Import Expert]

I think this has already been answered but yes its not been communicated by HMRC that well.

CHIEF the current UK customs system is being replaced by CDS.

As an importer, your courier or freight agent will still arrange the customs clearances as normal - Nothing changes. However if you want to get access to C79's / Postponed VAT Accounting records for imports or even manage your own Cash Accounts (Used to be called FAS in CHIEF) to pay Duty/VAT direct to HMRC you need to register for the CDS Financial Dashboard via the Government Gateway.

Also if you have your own customs deferment account you must authorise your customs agent to use this via the CDS financial Dashboard and set up a new direct debit with HMRC.

 

[GlennMiddleton]

I work for a company that needs a duty deferment account, but I cannot find the webpage that lets you register. The gov.uk website explains why you need an account but no link to applying. Its all very frustrating.

 

[japancool]

Apply for a customs comprehensive guarantee to cover customs debts

Use a customs comprehensive guarantee to cover Customs Duty, excise duty and import VAT when you regularly import goods or use common and Union transit.

www.gov.uk

 

[Import Expert]

I work for a company that needs a duty deferment account, but I cannot find the webpage that lets you register. The gov.uk website explains why you need an account but no link to applying. Its all very frustrating.

Apply for an account to defer duty payments when you import or release goods into Great Britain

Find out how to apply for a duty deferment account so you can delay paying most customs or tax charges when you import goods into Great Britain or release goods from an excise warehouse.

www.gov.uk

Section 2 under:

Apply to defer Customs Duty, excise duty and import VAT​

(Apply for a duty deferment account and optional guarantee waiver)

 

[GlennMiddleton]

Apply for an account to defer duty payments when you import or release goods into Great Britain

Find out how to apply for a duty deferment account so you can delay paying most customs or tax charges when you import goods into Great Britain or release goods from an excise warehouse.

www.gov.uk

Section 2 under:

Apply to defer Customs Duty, excise duty and import VAT​

(Apply for a duty deferment account and optional guarantee waiver)

Thank you so much, your a life saver.

 

[Deleted member 351022]

This wall of text is well worth the read, as a small business I sometimes think like Paul Ears stated. 'I know this might be a stupid question' I think this because I believe I do not know what is going on and I must have it wrong as how could the UK Government have made this such a difficult matter to understand?

Just to confirm how easy this would have been:

Are you a business importing goods?

If you import using Air freight or via Road, you're ok, you can go now.

If you are using freight forwarders, shipping companies and the like and importing goods using a vessel. you're not ok.

thanks to all who made this a group effort, we only have 2 days to go before we see some action, I do have an Air import coming from Korea so hopefully will come after 30th and if all normal, will report and confirm.

I am new to the forum so apologies for the belated comment. CDS should now be being used by declarants for imports into the UK irrespective of the mode of transport or where the goods are being imported from. This therefore includes air and road freight as well as sea freight.
HMRC have not made requirements for most businesses clear enough. If you are using a customs clearance agent / one of the fast parcel operaters it is they who really need to understand the complexities of CDS as they have historically done with the old CHIEF system.
post #25 explains clearly to what extent most businesses need to interact with CDS.

 

[Deleted member 351022]

While you'll obviously want to claim back VAT on your return for case 1, it could be seen as academic that for cases 2 & 3 you didn't bother to fill in boxes 1 & 4 so they cancel out - but HMRC may take a different view ?

HMRC do take a different view - the amounts in cases 2&3should be reported on the VAT return. Not all businesses are entitled to full import VAT recovery, such as importers that are partially exempt or do not own the imported goods.