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Purpose, scope and background (part 1)

Published 25 September 2025

Purpose and scope

These guidelines apply if you are operating, or intending to operate, within a Freeport. This includes businesses located in Freeport special tax sites as well as those based in Freeport customs sites.

These guidelines will also be helpful to:

• Freeport governing bodies
• customs site operators
• professional bodies that represent and advise clients on Freeports

We’ve developed these guidelines to help you understand the tax reliefs and customs benefits of Freeports, including:

• the tax reliefs and benefits available
• who can claim
• how to claim
• common errors
• helping you lower the risk of making errors
• advising what records to keep
• what to do if you make a mistake

These guidelines are not for customers who are operating in an Investment Zone. The HMRC Investment Zones information pack provides further details.

How to use these guidelines

These guidelines do not represent any change in the law or HMRC policy. You should read these guidelines alongside HMRC’s published guidance. You will be directed to the guidance within these guidelines.

You should use these guidelines to help make informed decisions, based on your individual circumstances. 

Following these guidelines may help reduce your organisation’s risk of:

• making errors
• penalty charges

Any reference to Freeports in these guidelines includes those in England and Wales, as well as Scottish Green Freeports, unless specific differences are highlighted.

These guidelines also explain the difference between a Freeport special tax site and a customs site, both of which can be located within a Freeport. These sites can be co-located, overlapping or separate.

Background

Overview

Freeport locations were announced in March 2021. The first Freeport became operational in November of the same year.

Freeport status gives customers access to several advantageous customs benefits and tax reliefs.

A Freeport can extend up to 45 kilometres beyond the port around which it is centred. Within this, much smaller areas can be designated to benefit from certain rules. To benefit from the direct tax reliefs, the relevant activity needs to be within a Freeport special tax site. To utilise the associated customs and VAT benefits, the customer must be based in a designated customs site (known in UK legislation as a “free zone”).

Scottish Green Freeports and Welsh Freeports

Following the introduction of Freeports in England, the Scottish and UK governments worked together to develop a Scottish Green Freeport model that reflects the unique conditions in Scotland. Many Scottish Green Freeport features operate in the same way to Freeports in England. Scottish Green Freeports offer relief to Land and Buildings Transaction Tax, rather than Stamp Duty Land Tax, to reflect the taxation system in Scotland.

Welsh Freeports are similar to the Freeports in England, but instead of Stamp Duty Land Tax, relief is given for Land Transaction Tax.

Types of sites within a Freeport

Reliefs and benefits are not available to everyone who operates in a Freeport. As well as being within the outer boundary, you must operate in a specially designated area within a Freeport. In addition, you must meet certain specific criteria.

There are two kinds of specially designated area. These are Freeport special tax sites and customs sites, each providing different reliefs or benefits. For more information you should read Tax reliefs and Customs and Excise benefits.

If you are in a customs site but not a special tax site, you will be unable to claim any of the Freeport tax reliefs and vice versa. It is possible for a Freeport special tax site to also be a designated customs site. However, this will require you to go through the customs site designation process.

Your business must be located within:

• a Freeport special tax site to claim the tax reliefs
• a customs site to benefit from the customs facilitations

A customs site operator is responsible for the security of their site and keeping records about goods moving in, around and out of the site. However, this does not give them an automatic right to declare goods to the Freeport customs special procedure. All businesses wanting to declare goods to the Freeport customs special procedure and keep them in a customs site must hold a Freeport business authorisation. You can obtain authorisation by applying to use the UK Freeport customs special procedure.

You can view maps of the various Freeport sites.