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Customs warehousing can benefit traders who import goods because it offers a storage facility that delays duty and/or import VAT payments until the goods leave the customs warehousing procedure or enter another customs procedure. Customs warehouses are operated by warehousekeepers, who must be authorised by HM Revenue and Customs (HMRC).
Traders can either store their goods in an existing customs warehouse or ask HMRC for authority to set up their own customs warehouse on their own premises. Goods imported from outside the EU are eligible for storage in a customs warehouse, and Common Agricultural Policy (CAP) and union goods may also be stored on the premises of a customs warehouse in certain circumstances.
When to use customs warehousing, eligible goods and types of customs warehouse
Customs warehouses are premises authorised and supervised by HMRC.
Entering your goods to customs warehousing means you can delay paying Customs Duty, import VAT, and where appropriate Excise Duty, until the goods leave the customs warehousing procedure or enter another customs procedure. You can also use customs warehousing when your goods have arrived in the UK and:
- you want to re-export them
- you’re uncertain about the final destination of your goods upon arrival
- your import licences or paperwork have been delayed or you’re waiting for a duty-relief quota to become available in respect of, for example, agricultural goods
- you want to discharge another customs procedure, such as inward processing (IP) for non-excise goods
- you wish to store your goods together with goods subject to another special procedure for example IP or with goods that are already in free circulation
To be eligible for customs warehousing, your goods should have been imported from outside the EU and be liable to customs duties and/or import VAT, or be moving in duty suspension from another member state - for example the goods have been entered to a duty suspension procedure in another member state or are moving under Union Transit.
You can also, if suitably authorised, use the customs warehouse procedure to store CAP goods that are eligible for an export refund or Union goods under the common or co-storage arrangements.
Goods subject to prohibitions or restrictions must be presented with the appropriate supporting documents at the EU frontier. Meat or meat products must also have been subject to frontier veterinary checks prior to their entry to the customs warehousing procedure.
There are usually no time limits for storing goods, except CAP goods.
1. Types of customs warehouse
There are 2 types of warehouse operated in the UK:
- a public customs warehouse type 1 means a public customs warehouse where the responsibilities referred to in Article 242(1) of the code lie with the holder of the authorisation and with the holder of the procedure
- a private warehouse where the holder of the procedure and holder of the authorisation are the same
|Union Customs Code (UCC) Article||Delegated Act (DA) Article||Implementing Act (IA) Article|
Non-Union goods may be stored in premises or any other location authorised for that procedure by the customs authority and under customs supervision.
Any person may use a customs warehouse for the customs warehousing of goods (public customs warehouse) or for the storage of goods by the holder of an authorisation for customs warehousing (private customs warehouse).
Goods may be temporarily removed from a customs warehouse providing this is authorised in advance by the customs authorities.
1.2 Specially equipped storage facilities
Where goods present a danger or are likely to spoil other goods or require special facilities for other reasons, authorisations may specify that they may only be stored in storage facilities specially equipped to receive them.
|UCC Article||DA Article||IA Article|
1.3 Premises or any other location
The customs authorities shall define in the authorisation referred to in Article 211(1) (b) of the code the premises or any other location as one of the following:
(a) public customs warehouse type 1
(b) private customs warehouse
All premises/locations must be named in either a single authorisation or each party must hold their own authorisations.
|UCC Article||DA Article||IA Article|
1.4 Retail sales
Storage facilities for the customs warehousing of goods shall not be used for the purpose of retail sale, unless goods are retailed in any of the following situations:
- with relief from import duty to travellers in traffic with countries or territories outside the customs territory of the Union
- with relief from import duty to members of international organisations
- with relief from import duty to NATO forces
- with relief from import duty under diplomatic or consular arrangements
- remotely, including via the internet, this enables goods to be picked and despatched to retail customers
|UCC Article||DA Article||IA Article|
Authorisations shall not be granted if the premises of customs warehouse or the storage facilities are used for the purpose of retail sale. An authorisation may, however, be granted, where goods are retailed remotely (see Article 201 DA), including via the internet, mail or phone and are delivered to the buyer or consignee at a location other than the customs warehouse.
Article 128(1) UCC IA stipulates that the relevant sale to determine the value of goods is the sale that is a sale for export that brings the goods into the Union. This is the sale occurring immediately before the introduction of the goods into the customs territory of the EU.
A further aspect relating to application of the transaction value method is also covered by Article 128 (2) UCC. This relates to transactions prior to the release of goods for free circulation. Article 128(2) must be read in conjunction with Article 128(1).
This relates to the customs value of goods, inter alia, in a customs warehouse, when these are declared for release for free circulation. This rule isn’t limited to goods sold while held in a customs warehouse. Other procedures (temporary storage or while placed under a special procedure other than internal transit, end use or outward processing) are also relevant. However, for ease of reference and because the customs warehouse procedure is the most common procedure used in this context, these guidelines will refer to customs warehouse only.
This provision covers cases where the goods are deemed to meet the criterion of goods “sold for export” in accordance with Article 128(1), but in the context (circumstances) of Article 128(2). In other words, this rule covers the case of a sale of goods in warehouse, in the absence of a sale related to the same goods which covered the goods on arrival into the Union.
In such situations, where the goods are the subject of a sale and fulfil the conditions laid down in Article 70 UCC (and the sale isn’t a “domestic” one) only after being placed under a special procedure, such sale shall be used for the determination of the customs value under the transaction value method.
However, if a proper sale for export exists when the goods arrive into the EU, that is the basis for the customs value (Article 128(1) IA).
Alternatively, when no such sale exists, the sale (deemed to be a “sale for export”) taking place during the warehousing operation will be the relevant basis for the declarant to use as a basis to declare a customs value under the transaction value method.
1.5 Processing in a customs warehouse
Where an economic need exists and customs supervision isn’t affected, the customs authorities may authorise the processing of goods under inward processing or end use to take place in a customs warehouse subject to the conditions for those procedures being met. The goods being processed are not considered to be under the customs warehousing procedure.
1.6 Responsibilities of the holder of the authorisation
Both the holder of the authorisation and the holder of the procedure are responsible for ensuring the goods are not unlawfully removed from customs supervision and fulfilling the obligations arising from the storage of goods under the customs warehousing procedure.
The records shall at all times show the current stock of goods which are under the customs warehousing procedure. Information on the temporary removal of goods shall appear in the records too. Goods may be temporarily removed for a period which has to be established in the authorisation for the removal.
Where goods are entered for the customs warehouse types E or U, the entry in the records shall take place when they arrive at the holder’s storage facilities.
Records have to contain information that is updated immediately concerning any movements of goods (for example, in the context of temporary removal or to the customs office of exit or to the customs office of discharge), and at the latest when goods have left the premises of the customs warehouse.
|UCC Article||DA Article||IA Article|
1.7 Use of equivalent goods
The use of equivalent goods shall not result in a given customs status being assigned to a quantity of goods greater than the quantity actually having that status.
1.8 Temporary removal
You can remove goods from the warehouse on a temporary basis to undertake a usual form of handling. You must keep records and obtain HMRC authorisation prior to the removal of the goods. Goods may not be removed to private premises using the temporary removal arrangements from the customs warehouse for any purpose. An authorisation for temporary removal will not be granted for goods which are to be temporarily removed from the customs warehouse to participate in an auction as the purpose of an auction is to conduct a sale.
1.9 Releasing customs warehouse goods to free circulation and paying duties
Release to free circulation means removal of the goods from the customs warehousing procedure where all duties and taxes are paid to put the goods into free circulation.
When your goods are released from the customs warehousing procedure, you may have duties and taxes to pay. The valuation of goods for the calculation of import duties is based - on the value of the goods upon removal.
1.10 Goods that may be stored in a customs warehouse
The following goods may be stored in a customs warehouse:
- non-Union goods (whether or not eligible for preference) that are liable to customs duties, excise duties and/or import VAT
- non-Union goods for which the necessary supporting documents, for example, Department for Business Energy and Industrial Strategy (BEIS ) licences are not available at the time of import
- non-Union goods originally imported to another suspensive regime, such as IP or TA that are being warehoused prior to re-export from the Union
- non-Union goods that are to be processed under IP
- non-Union goods that are not subject to a positive rate of Customs Duty in the tariff, but are liable to import VAT
- Union produced goods eligible for export refunds
- non-Union goods that have been released to free circulation
- non-Union goods now in free circulation, which are the subject of a claim under the Rejected Imports arrangements
1.11 Your responsibilities as a warehousekeeper
As the warehousekeeper, you’re responsible for:
- the security and proper control of the warehoused goods, including maintaining stock records for those goods throughout the customs warehousing procedure and accounting for any shortage
- ensuring that the conditions of your customs warehouse authorisation and all your obligations are met
- fully co-operating with us in our supervision of your authorisation
- allowing us access to the warehouse premises, your warehouse records and to the warehoused goods at all reasonable times
1.12 Your responsibilities as the holder of the procedure
In order to declare goods to the customs warehouse procedure the holder of the procedure must be established in the EU. If you are the depositor in the customs warehousing procedure, you are the holder of the procedure in a public warehouse and you are bound by the declaration placing the goods under the procedure. In a private warehouse the holder of the procedure/depositor is the warehousekeeper. You must therefore ensure that the goods are sent directly to the warehouse shown on the declaration (the maximum period allowed is 5 working days of the clearance of the declaration entering the goods to customs warehousing). You should be aware that you as the holder of the procedure are liable for any customs debt that arises, if the goods fail to be accounted for at the intended warehouse destination.
If you’re using a public warehouse, you’re responsible for providing the warehousekeeper with all the necessary details of the declaration to the customs warehousing procedure, to enable the warehouse stock records to be updated (such as the quantity and a description of the goods). You should also take steps to ensure that the warehousekeeper holds a valid customs warehouse authorisation for the type of goods you wish to deposit. Failure to do so could mean that you’ll become liable for any customs debt created by the incorrect entry of the goods into the customs warehouse procedure.
The holder of the procedure shall be responsible for fulfilling the obligations arising from the placing of goods under the customs warehousing procedure. As the holder of the procedure you must be established within the EU and must ensure that you:
- correctly declare the goods, including where an agent is used by giving clear written instructions
- ensure that your goods are sent directly to the warehouse shown on the declaration
- provide the warehousekeeper with details of the declarations and an explanation of any discrepancies that are identified
- ensure the goods are correctly declared on removal from the customs warehouse
You’re also responsible for customs debt. If you’re using a public warehouse, you must give the warehousekeeper all the details of your customs declaration for their records and make sure that the warehousekeeper holds a valid customs warehouse authorisation for the type of goods you wish to deposit.
|UCC Article||DA Article||IA Article|
1.13 The VAT position on supplies of goods in customs warehousing
Sales, other than retail sales, or other supplies of third country goods that remain within the customs warehousing procedure are disregarded for supply VAT purposes. This is provided that the sale or supply takes place before the removal of the goods to free circulation.
1.14 Basic conditions for authorisation
Before we authorise a new customs warehouse we must be satisfied that:
- you’re established in the EU
- the warehouse will be used primarily for the storage of goods
- there is a genuine economic need, either sufficient potential trade for a public warehouse to be viable or sufficient benefits to you for a private warehouse (for example the amount of re-exports involved or the amount of Customs Duty suspended)
- your stock records are adequate to verify the receipt, storage, handling and disposal of the goods and they must be able to show at all times the current stock of goods that are held under the customs warehouse procedure
- you’re able to comply with all the conditions applicable to your authorisation
- you must be solvent and have a compliant revenue record
- we must be able to supervise and monitor the customs warehousing procedure without having to introduce administrative arrangements that are disproportionate to the economic need involved
- authorisations which involve more than one member state may be granted also for public customs warehouse
- authorisations shall not be granted if the premises of customs warehouse or the storage facilities are used for the purpose of retail sale - an authorisation may, however, be granted, where goods are retailed remotely (see Article 201 DA), including via the Internet, mail or phone and are delivered to the buyer or consignee at a location other than the customs warehouse
- separate authorisations for the use of accounting segregation are needed in accordance with Article 58 DA (origin of goods) and 177 DA (authorisation for a special procedure)
|UCC Article||DA Article||IA Article|
1.15 Additional authorisation conditions for the storage of goods subject to excise duty in a customs warehouse
If you intend to store non-Union goods on which excise duty may become due on release to free circulation in your customs warehouse you must apply and be specifically authorised to do so. You must enter the 6 digit commodity code, description, estimated quantity and value of the excise goods that you intend to hold in the warehouse in box 7 of the application form SP2: Application for Customs Warehouse.
When moving excise goods, they must be covered by a guarantee under conditions equivalent to those provided for in the transit procedure. This includes the movement of such goods under the customs warehousing procedure to or from the port or between sites/warehouses approved within the same authorisation.
1.16 Storage of Common Agricultural Policy (CAP) goods in a customs warehouse
If you intend to store CAP goods, which have special storage requirements, for example, a need to be refrigerated or chilled, you must ensure the warehouse facility is properly equipped for such goods. Suitable facilities must be available to enable HMRC officers to examine, sample and weigh goods stored in the customs warehouse, and any equipment necessary for weighing, measuring or otherwise taking account of the goods must be maintained in a satisfactory condition.
You should also ensure that if the goods are to be the subject of an export refund you hold an appropriate authorisation for the additional procedure used. For more information regarding CAP goods refer to Notice 780: Common Agricultural Policy import procedures and special directions for goods.
1.17 Making alterations or amendments to the authorisation
If any details of your business change (for example name, address, the ownership or the systems you use) you must advise your supervising office in writing without delay. As the holder of the customs warehouse authorisation, you must ensure that all the details held by us relating to your authorisation remain current and correct.
1.18 Changes that may and may not be allowed to my authorisation
Changes in trading name or style, not involving the transfer of business to another legal entity, will not normally require a new customs warehousing authorisation. However, you should contact your supervising office to confirm whether the changes will affect your current authorisation.
1.19 changing the terms and conditions of my authorisation
You can request a change to the terms and conditions of your authorisation, for example the area designated as the authorised location or type of goods to be stored. To do this you must contact your supervising office and provide details of the reason for the change. If it concerns an authorisation involving more than one member state, the customs authorities in the other member states may need to be consulted. If your request is granted, we’ll normally confirm this in writing and you should attach the notification to your authorisation. If appropriate, we’ll issue you with a new authorisation.
We can also change an authorisation ourselves without a request from you if we think it necessary to impose additional conditions or to meet any changed circumstances. Again, any such changes will be confirmed to you in writing.
1.20 About co-storage
Co-storage is the storage of Union and non-Union goods together, to enable you to make full use of the available space in your customs warehouse. Co-storage can also apply to goods that are under inward processing arrangements stored in a customs warehouse. It must be possible to identify the status of your goods at all times. Co-storage must not be allowed to affect the operation of the customs warehouse procedure.
1.20.1 How you apply for co-storage
You can apply for co-storage either at the time of application for a customs warehouse authorisation or by making an application in writing to your supervising office after your authorisation has been granted.
The application must include the following details:
- a full description of the goods
- the customs status of the goods
- how the goods are to be physically identified
|UCC Article||DA Article||IA Article|
1.20.2 Record keeping
If you are approved to operate co-storage, we generally do not require that the goods not under the customs warehouse arrangements are entered into the stock records. However, if we consider it necessary for assurance purposes we can require you to do so.
1.20.3 Identification of goods
If you store union goods and/or goods under IP they must be clearly identifiable from the goods under the customs warehousing arrangements. You must be able to identify both physically and in the records (if we have required their entry) the goods under the respective customs procedures and the Union goods. If necessary, we can require you to mark or label such goods to ensure that goods of different status can be easily identified.
1.21 Common storage of equivalent goods
1.21.1 About common storage
Common storage is the storage of the same type of goods, with a different customs status, known as equivalent goods. You need to be authorised by us if you want to make use of the benefits of common storage. We consider common storage is more appropriate to private warehouses where the warehousekeeper is also the depositor because of the need to keep records and to prove equivalence.
1.21.2 What we mean by equivalent goods
Equivalent goods are goods that share the same 8-digit commodity code, the same commercial quality and the same technical characteristics but have a different customs status, and where it’s not possible for you to identify their status at all times. It can also apply where you have a high incidence of goods returned to warehouse duty paid or where you hold existing duty paid stock prior to a warehouse authorisation being granted.
Note: any goods that will be subject to excise duty, on their release to free circulation, cannot be stored under common storage.
1.21.3 How to apply for common storage
Usually you’ll apply for common storage at the same time as applying for a customs warehouse authorisation. When you apply to use common storage, you must provide sufficient information to enable us to make a comparison between the goods. You must state factors common to the equivalent goods and the customs warehousing goods and suggest how this can be checked (for example technical specifications or samples). If you wish to apply for common storage after the warehouse authorisation has been granted you should contact your supervising office, providing the information required in box 22 of the SP2: Application for Customs Warehouse.
1.21.4 The record keeping requirements for common storage
We’ll need to be satisfied that your records and/or systems can identify, monitor and correctly account for goods that are stored under common storage. This means your system needs to be able to identify the number of goods allocated to free circulation and those that have a different status.
On removal, the amount of free circulation goods cannot exceed the amount shown in your stock records as having that status. A negative stock balance of customs warehouse stock is not permitted.
Stock records show 1,000 cartons of non-Union goods and 1,000 cartons in free circulation. The goods meet the equivalence criteria. This means there is 2,000 cartons of goods in common storage.
The warehousekeeper wants to remove 1,500 cartons. As 1,000 cartons are already in free circulation, a declaration to free circulation is required for the other 500 cartons, as duty has not been paid on them. The stock balance after removal would show 500 cartons of non-Union goods under customs warehousing and a nil balance for the free circulation stock.
Duty is required to be paid on the remaining 500 cartons as an when they are removed to free circulation.
|UCC Article||DA Article||IA Article|
1.21.5 Licensable goods in common storage
Your records and/or systems need to provide safeguards preventing the removal to free circulation of goods liable to restrictions. For example goods being removed to free circulation without an appropriate valid licence being available. We also need to be sure that authorising common storage doesn’t adversely affect the customs warehousing procedure or any subsequent customs procedure. For example, it’s not being used to circumvent anti-dumping duty requirements.
1.21.6 If there’s a difference between my stock records and the physical stock held
Variations can occur when a comparison is made between the warehouse stock records and the physical stock held of goods with a different customs status. This doesn’t refer to discrepancies when the goods were first received. You should investigate any variations that arise and make the necessary adjustments to your records including providing an explanation for variations.
However, if there is no identifiable explanation you can apply the following:
- shortages (negative adjustments) should first be deducted from the Union status stock where there is a positive balance. If this stock adjustment exhausts the Union status stock, the remaining balance of the adjustment should be made against any non-Union stock. You’ll need to make a declaration to free circulation
- excesses (positive adjustments) should first be added to Union status stock, unless the excess existed when the goods were first received at the warehouse
- excesses and shortages can be ‘off-set’ that is, adjusted against each other, if the goods concerned are equivalent
1.22 Discharge of the customs warehousing procedure
1.22.1 What discharge means
Discharge means the removal of goods from the customs warehousing procedure. This could coincide with the physical removal of goods from the warehouse premises or that the goods are removed from the customs warehousing stock records but still remain physically on the warehouse premises.
The customs warehouse procedure may be discharged by:
- entry of the goods to free circulation (including onward supply to another member state and release to an excise warehouse)
- entry for re-export
- entry to another special procedure such as IP
- shipment as duty free stores - refer to paragraph 1.22.18
1.22.2 Evidence I need before I remove goods from the warehouse
You must not allow goods to leave your warehouse until you have received evidence that we’ve officially released the goods - if you do not get this evidence before the removal of the goods, you’ve failed to comply with the conditions of your customs warehouse authorisation and as a result you could be liable for any customs debt that may become due on the goods you’ve released. You may also be liable to a penalty under the Customs Civil Penalty provisions.
1.22.3 Evidence of ‘official release’ of the goods
Evidence of official release of the goods can be:
- a copy of the Customs Handling of Import and Export Freight (CHIEF) Display Entry Version Details (DEVD) screen print, E2 and plain paper copy 6 C88
- if using Customs Freight Simplified Procedures (CFSP) an entry into your customs warehouse stock records and Customs Supervised Exports (CSE) records (which may be one and the same) followed by an electronic CFSP supplementary declaration.
1.22.4 The effective date from which tariff measures (duty rates, anti-dumping and licensing restrictions) apply
The measures that apply are those in force at the time we receive the form C88 removal declaration regardless of when you intend to physically remove the goods from the warehouse.
1.22.5 How to calculate the duty chargeable on goods removed from free circulation
You can work out the duty charges on the goods by using the following elements:
- the tariff description and rate of duty (UK Tariff, Volume 2)
- the quantity
- the value (refer to Notice 252: valuation of imported goods for customs purposes, VAT and trade statistics and VAT Notice 702: imports
Use these elements including the official rate of exchange (published weekly by us) applicable at the time the goods are removed from the customs warehousing arrangements.
1.22.6 The tax point on removal from customs warehousing
Form C88 is accepted when the electronic acceptance is received and you are notified of the entry number. Only on receipt of this number can the goods be removed from the warehouse and the tax point established. You may not remove the goods until you received these details. For goods removed using CFSP the date applicable will be the date that the goods were entered into the CFSP records. This entry sets the tax point.
1.22.7 When import VAT becomes due
Import VAT becomes payable when goods are removed from the customs warehousing arrangements to free circulation unless:
- they qualify for relief from import VAT - refer to VAT Notice 702: imports
- they are for onward supply to another EU member state for VAT registered parties in both member states where only the customs duty is paid - refer to VAT Notice 702/7: import VAT relief for goods supplied onward to another country in the EC
1.22.8 Removal of goods as a finished Article, originally imported as parts
Generally, goods in the customs warehousing procedure do not change their nature or classification. However, goods entering a warehouse as individual items/parts may be classified as a finished article when removed. The parts must be presented together in quantities that make a specific number of the finished article.
The goods must comprise an assembly of parts so far advanced that they already have the main essential features of the tariff heading being used on removal of the product to free circulation. Where the finished article contains Union and non-Union components the non-Union components must form the essential character of the finished article prior to the addition of the Union components. If you are unsure as to whether your goods will qualify using the above criteria then you should contact the Tariff Classification Service.
1.22.9 When tariff preference or tariff quota rates apply
You may be able to claim a reduced or zero rate of duty under the tariff preference (refer to Notice 826: tariff preferences - imports) or Tariff quota (refer to Notice 375: Tariff quotas) arrangements on removal of the goods being stored to free circulation.
If you are making an electronic declaration Direct Trader Input (DTI), you must complete the C88 declaration using the relevant document and status codes which are detailed at annex C10 and C11 of the UK Tariff Notice 826: tariff preferences - imports. The preference document must be annotated with the amount of the part removal and you must note your records. You should also make sure that procedures are in place to ensure that a preferential rate of duty is only claimed on the same amount of goods that are covered by the preference certificate or document.
A claim to tariff quota relief is made by entering the tariff quota serial number in box 39 of the entry when goods are declared to free circulation. When presentation of a preference entry is related to a claim to quota, you must ensure that the second and third digits of the code required in box 36 properly reflect this, for example 20/23/25/28.
1.22.10 If a preference certificate or document is found to be invalid
Where checks show that the goods do not qualify for preferential tariff treatment claimed, duty will be payable at the full (non-preferential) rate. Where a warehousekeeper makes a customs declaration as an indirect representative, both depositor and warehousekeeper are jointly and severally liable for the debt. Union legislation allows for the collection of duty covering a period of up to 3 years from the date of acceptance of the import declaration relating to the goods in question. Refer to Notice 826: tariff preferences - imports.
Note: preference certificates or documents are only valid for a limited period of time and you should ensure you monitor the expiry dates, to avoid losing the right to apply a preferential treatment to the goods. You should endorse the certificate with the stock reference number allocated to the consignment and date of warehousing of the goods. You should also note that we cannot accept a preference certificate or document (for a claim for a preferential rate of duty on release of the goods to free circulation) that is presented more than 2 years after the date of issue of the preference certificate/document.
1.22.11 Deducting import VAT paid as input tax
Import VAT can be deducted as input tax subject to the normal VAT rules and if all the following conditions apply:
- you’re registered for VAT
- you’re the consignee on removal of the goods
- the goods are removed for the purposes of your business
To reclaim this tax on your next VAT return you must hold official evidence that the VAT shown has been paid or deferred. Evidence is normally in the form of a monthly VAT certificate on a form C79. We issue this direct to your VAT registered address on or about the 12th day of the month and it covers transactions for the previous calendar month.
1.22.12 Duty free stores
Duty free stores are goods that will be used, consumed or sold to a passenger on an ‘entitled’ ship or aircraft leaving the UK. They include foodstuffs and goods for on board consumption, goods for retail sale, spare parts and other items of equipment whether or not for immediate fitting and fuel.
1.22.13 Removal of goods as stores
Stores for both vessels and aircraft may be removed using commercial documentation. Authorisation to use the procedure will be included in your customs warehouse authorisation and it will specify the notification and documentation requirements. Goods intended as stores, but sent out from the UK, as freight to supply vessels abroad, must be declared for re-export.
Note: all requests for removal must contain a declaration by the ship’s master or aircraft commander that the goods are for use as stores on a qualifying voyage/flight. Without this signed declaration, you must not remove the goods customs duty and VAT free.
1.22.14 Removal of goods from an Aircraft Store Floor
Aircraft commanders are required to use approved Aircraft Store Floors (ASF) for most of their requirements. No specific authorisation is required from us but you must ensure that the goods are for use as stores on a flight by an entitled aircraft. An ASF will normally supply stores for an aircraft and the usual ordering procedure should be used.
1.22.15 Entitled ships or aircraft
For goods which will be consumed an entitled ship or aircraft is one making a voyage to a destination port or airport outside the UK or a cruise where the vessel will call into at least one non-UK port for stores.
For goods for retail, an entitled ship or aircraft is one that visits a non-EU destination.
1.22.16 Loading and removal procedures for stores
Warehoused goods can be removed for shipment as stores on entitled ships or aircraft using commercial document. Authorisation to use the procedure will be included in your customs warehouse authorisation and it will specify the notification and documentation requirements.
1.22.17 Details to be shown on the commercial order document for stores
When removing goods from your warehouse you must ensure the commercial order includes all of the following:
- a document serial number
- the name and address of the warehouse
- the number and description of packages
- the quantity and description of goods
- the ship’s name/aircraft flight number, place of loading and destination
- the following signed and dated declaration and undertaking:
- ‘This vessel/aircraft is entitled to receive duty free stores. I undertake to pay to HMRC the amount of duty/tax due on any or all of the goods which are neither shipped intact nor re-warehoused in a customs warehouse if not shipped’
1.22.18 Action needed on the removal of ships’ stores
You must, as the warehousekeeper, raise a despatch note with the information taken from the order and the:
- shippers own reference/order number
- authorisation number of the customs warehouse
- warehouse stock reference numbers
- number and description of packages
- commodity codes and description of goods
- following statement ‘duty free ships/aircraft stores to entitled vessels’
- date of removal from the warehouse
- name and address of the agent at the port of shipment
- provision for a certificate by the authorised person that the goods have been received on board
As the warehousekeeper, you must also:
- certify on the despatch note that the goods removed from the warehouse are those shown on the commercial document
- check that the shipper has included and signed the declaration of entitlement and undertaking to pay the duty on any goods not properly shipped on the request for stores
- record the removal in the stock account
- notify us as specified in your authorisation
You’ll need 4 copies of the despatch note, headed to show their purpose and destination:
- copy 1 - sent to your supervising office 48 hours prior to removal
- copy 2 - the ship’s master’s signed copy certifying receipt of the goods on board
- copy 3 - the ship to keep for their own records/presentation to Customs when required
- copy 4 - your warehouse records
Unless we wish to examine the goods, you may allow removal as soon as the 48-hour notification period has elapsed. If a copy of the despatch note certifying receipt of the goods on board the ship or aircraft isn’t received within 2 months of removal, you must check with the shipper and report all such ‘unconfirmed’ shipments in writing to your supervising office. Please ensure you keep copy despatch notes and commercial documentation in your warehouse records for our inspection.
1.22.19 Action needed for the removal of stores to an aircraft
The procedure for aircraft stores is similar to those for ship’s stores but may also involve the use of forms C208 and C209 in place of commercial documentation. Where stores are being supplied, other than from an ASF you should follow the procedure for removal for ship’s stores, showing details of the aircraft where appropriate.
1.22.20 Re-warehousing of ships/aircraft stores
Stores that have not been used on the voyage or flight can be re-warehoused. Surplus stores without established Union status can be re-warehoused using form C88 (SAD) or C209 procedure for aircraft stores floor. Once warehoused the goods can only be removed as stores or into free circulation any other use is subject to our prior permission.
1.22.21 Information needed in stock records for all removals
On receipt of evidence of release from us, you must check that the details of the goods on the evidence agree with your stock records. Any discrepancies should be resolved with the depositor or the provider of the evidence.
You must include the following details in the stock records:
- the number and description of packages
- the quantity
- the identifying reference of the removal evidence, for example date of acceptance and entry number on the form C88
The stock records should be completed for any removals from the customs warehousing procedure before the goods are removed.
1.22.22 Computerised stock control systems
If you intend to use a computerised stock control system where the customs warehouse account is separate from the commercial records and the customs warehouse stock account isn’t updated with details of the removals at the same time (batch processing) you should notify your supervising office. They’ll provide you with the criteria you must satisfy in order to operate such a system.
1.22.23 Removal of goods before their release is authorised
It’s an offence to remove or allow goods to be removed from a customs warehouse unless we’ve authorised their release or you have other evidence that we’ve allowed their release. If you fail to comply, we may issue a civil penalty and/or withdraw your warehouse authorisation. You’ll have to pay the duties on any goods not satisfactorily accounted for.
1.22.24 Closing the accounts
You must balance and close the stock record when the goods have been recorded as removed. If the same goods had been declared to customs warehousing on different declarations they should be discharged against the earliest declaration when removed from customs warehousing. If you wish to discharge removals against specific entry declarations, you should contact your supervising office.
1.23.1 Types of re-export declarations
Export declarations have to be submitted electronically to the customs computer system known as CHIEF. This can be done by you, someone acting on your behalf or, exceptionally, by customs staff.
Goods may be re-exported using the following declaration methods:
- full National Export System (NES) electronic declaration procedure (a 4-part procedure of pre-lodgement, arrival and departure) - refer to Note below
- electronic declaration using the NES simplified procedures (a 3-part procedure of pre-lodgement, arrival and departure)
Entry Into Declarants Records (EIDR) can be used to enter goods to export or re-export where a pre-departure declaration isn’t required. Traders wishing to use EIDR have to have an EIDR authorisation.
Note: you’ll not need a NES authorisation to submit a full re-export declaration electronically but you’ll need to be granted access to the Customs CHIEF computer. Notice 275: Customs export procedures tell you how this may be arranged.
1.23.2 Export simplified procedures
Subject to authorisation for NES, the following simplified procedures are also available.
Simplified Declaration Procedure (SDP) an electronic simplified procedure for goods declared at the office of export or exit, by the completion of a declaration containing a minimum of information. A supplementary declaration will be required within 14 days.
Note: if you are authorised to use SDP you must send pre-shipment advice declaration and notifications and supplementary declarations to Customs electronically. Notice 275: Customs export procedures has more information about using the NES simplified procedures.
1.23.3 Amending your customs-warehousing authorisation if you want to release goods under the simplified procedures for re-export
You must write to your supervising office and ask for your customs warehousing authorisation to be amended to include the use of the simplified procedures or, where applicable, details of the exporter or agent and their NES authorisation.
Note: if you, the exporter or declarant want to use the simplified procedures, the intending entity must in the first instance get a NES authorisation to use SDP.
1.23.4 Closure of the warehousing stock accounts and the evidence required
Goods removed for re-export must not be closed in the stock records until satisfactory evidence of discharge of the customs warehousing arrangements has been received. The primary evidence is the goods departure message or S8 report where goods have exited from another member state. However, in exceptional circumstances we may accept a commercial equivalent if the export declaration or goods departed message cannot be obtained.
If you use a commercial document as evidence of re-export, you should ensure that the document includes a reference to the re-export declaration entry number. Commercial documents without this reference number cannot be accepted, as they do not identify if the goods were correctly declared as re-exportation of customs warehousing goods.
1.24 Completion notes for form SP2: Application for Customs Warehouse
These completion notes should be used to help you complete your SP2 application for a customs warehouse authorisation under the Union Customs Code (UCC).
If you do not complete the SP2 application in accordance with these completion notes and it doesn’t contain sufficient information for us to make a decision, your application may not be accepted in accordance with UCC article 22(2).
Please also ensure that you complete the customs warehouse questionnaire which is required to assess the applicant’s eligibility for a customs warehouse authorisation against the additional criteria introduced under UCC. You can obtain the questionnaire from the appropriate address in paragraph 1.4 of Notice 3001.
Box 1 - applicant’s name and address
Enter the full name and address of the applicant. The applicant is the person to whom the authorisation will be issued and who must be established in the EU. Ensure that the name entered in this box is the correct legal entity. Your VAT and Economic Operator Registration and Identification (EORI) number must also be included in this section.
Note: if you are a limited company please include your Incorporation Number in box 25.
Box 3 - type of application
New Authorisation - check this box if you wish to apply for a new customs warehouse authorisation.
Change to an existing authorisation - if you already hold a customs warehouse authorisation and are telling us of any changes enter your customs warehouse authorisation number in full.
Box 4 - continuation forms
Tell us in this box if you have used any continuation forms for any of the boxes.
Box 5 - place and kind of accounts and records
Specify the place where the commercial, tax or other accounting material is going to be held in the first set of boxes. In the second set of boxes indicate the place where the customs warehouse stock records are to be held. For all warehouses the customs warehouse records should be kept at the warehouse or main storage site if it’s a multi-site authorisation. If additional sites are required please include additional details as an attachment, giving full addresses and plans.
Give full details of the commercial accounts and records used in the business. Include details of the commercial stock system in use (name and version) and indicate whether this will be used or adapted for use as the customs warehouse stock record. Include details of any duty management system software packages that you intend to use as applicable.
The overview of procedures must be submitted with the application and be comprehensive enough to guide a trainee/HMRC through your procedures. This should detail how you’ll deal with the entry of goods to the customs warehouse from the point where you know you are going to receive them, to the release of the goods to free circulation, re-export or another customs procedure. As a minimum it should include:
- how you are made aware that goods are to be received and removed
- who is responsible for declaring the goods to HMRC and how this will be completed (for example, by an agent, by direct input to CHIEF etc)
- how you’ll ensure that goods are delivered directly to the authorised premises within 5 days
- any physical and record checks on arrival and removal from the customs warehousing procedure - which record(s) are completed, when and by whom
- how the stock will be physically shown as duty suspended in your warehouse (for example, labelling, racking numbers, etc.)
- how your system will differentiate between non-duty paid and duty paid stock, for example by location or pallets (unless equivalence is used)
- how your system will differentiate between warehouse locations, if applicable?
- when the goods are being removed, which system(s) are completed, including at what point in the process this happens and what prints/actions are generated (pick notes, instructions etc)
- at what point will the goods be declared to free circulation or another customs procedure and how and by whom this will be completed (for example, an agent, direct entry to CHIEF etc)
- checks that are undertaken to ensure your computer and manual records tally (if applicable)
The stock record specimen must show how the stock record will contain the minimum information required by the legislation (please see section 5 in Notice 3001 for more information).
Method of keeping stock records - check the relevant box dependant on the type of customs warehousing stock records you intend to keep. It should be noted that there may be additional information requirements where a computerised stock record system is used.
Box 6 - period of validity of the authorisation
Provide the requested date on which the authorisation should take effect - please put the date that you wish the authorisation to start, this must be a date after your application is submitted. Please note HMRC has 60 days to consider your application after it’s accepted.
Do you have a date of expiry of the authorisation - please tick no to this question as customs warehouses do not have an expiry date.
Box 7 - goods to be placed under the customs procedure
Method of receipt - if you receive your goods via a port or airport, which isn’t by post, please select import other than post.
If you receive goods from another customs procedure please include details of the procedure, who is responsible party and the authorisation number (for example processing, Company X, authorisation number).
Details of the goods to be stored - if you are entering various goods, make sure that a trade and/or technical description of the goods to be stored is given (this must be adequate to allow a layperson to identify the goods for example books, soft toys etc). Alternatively you may supply a product list as long as this gives all the necessary details. You should sign and date the product list. This will form part of your customs warehouse authorisation. If you store goods for which you are not authorised you may be liable for a customs debt.
Box 9 - details of the planned activities
Describe if the goods are just being stored or if you wish to carry out any other procedures (such as usual forms of handling (UFH), such as removal of damaged components).
Box 10 - economic conditions
In this box you need to give details about your economic need for the warehouse.
If you intend applying for a public warehouse you should state which businesses have expressed an interest in utilising the customs warehouse and include copies of letters from them expressing their intention to use it. Include separate indications of the potential duty amount and VAT amount that will be suspended annually by each depositor.
If you intend applying for a private warehouse then you should include estimates of how much duty and how much import VAT you anticipate will be suspended in the course of a year.
For all types of warehouses estimate whether the duty suspended would be in terms of goods for re-exportation, release to free circulation, goods subject to measures applicable on entry to free circulation or whether the warehouse is to be used for goods subject to a special export refund.
Box 11 - customs offices
Office of placement - this is the port(s)/airport(s) that you wish to import your goods through.
Office of discharge - this is the port(s)/airport(s) that you wish to export or despatch your goods from.
Supervising office(s) - this is the office that will supervise your authorisation, normally this will either be (non-Large Business Service Traders)
The Authorisations and Returns Team
CITEX National Functions
HM Revenue and Customs
Peter Bennett House
or your Customer Relations Manager (Large Business Service Traders).
Box 12 - identification
If none of the tick boxes are relevant you may put how you’ll identify the goods such as SKU, pallet locations etc.
Box 14 - type of declaration
If you (or a depositor using a public warehouse) want to be authorised to make declarations using simplified procedures then you (or a depositor for a public warehouse) must also be authorised for CFSP. You should check the relevant box in this section even if the CFSP authorisation isn’t held by you.
What procedure do you intend to use - if you intend to have goods deposited into your customs warehouse by means of the Simplified Declaration Procedure (SDP) or Entry In the Declarant’s Records (EIDR, formally LCP temporary storage), please detail who holds the authorisation. If you intend to remove goods from your customs warehouse using EIDR (formally known as LCP removals from customs warehousing) or SDP (for removals to Onward Supply Relief only), please explain who holds the authorisation and which procedure they’ll be removed to (for example, free circulation, processing etc).
Box 15 - transfer of rights and obligations
Select no because customs warehouses authorisation holders can only transfer their rights and obligations in highly limited circumstances. If this is to be requested please discuss with your supervising office in the first instance.
Box 16 - additional information
In order to operate a special procedure it’s a requirement that a guarantee be taken to cover the potential debt liability. This will include customs duty and in certain cases import VAT.
Please note that a deferment account cannot be used to guarantee potential debt.
You’ll need to cover the total volume of goods entered to each special procedure by a guarantee, but you don’t need to hold separate guarantees for each. You can choose to apply for a comprehensive guarantee to cover all your liabilities under a single guarantee.
The guarantee must be enough to cover the maximum amount of customs duty applicable to the goods held in the procedure at any one time.
This amount may be reduced or waived depending on the level of comprehensive guarantee authorisation held (100%, 50%, 30% or 0%). If you would like to benefit from a guarantee waiver or reduction you’ll need to apply for a comprehensive guarantee.
Customs will assess the business eligibility for a waiver or reduction. If successful the guarantee requirement may be reduced to 50%, 30% or a waiver for potential debts.
UCC: guarantees](https://www.gov.uk/guidance/introduction-of-the-union-customs-code-ucc#guarantees) and section 2.8 of Notice 3001 has more information about guarantees.
For information on comprehensive guarantees and how to apply please see Customs Information Papers 51(2015) and Customs Information Paper 24 (2016): Customs Comprehensive Guarantee
CCG1 is the application form you need to apply for a customs comprehensive guarantee. In order to properly assess this can you please attach a full product list of all goods that you wish to use within inward processing, with the 10 digit commodity codes associated with the description. The descriptions must be in plain language.
Potential debts falling below the statistical threshold
If it’s your intention to take advantage of the Customs Comprehensive Guarantee (CCG) waiver for potential debts as set out in Customs Information Paper 56 (2016): Customs Comprehensive Guarantee for potential debts, you should indicate this clearly in your application under ‘additional information’. When re-submitting your application, you must also provide a calculation/s as confirmation that the potential debt associated with your intended imports falls below the current statistical threshold and therefore that a CCG isn’t required in respect of the application being made.
Box 18 - warehouse type
Public warehouse - if you wish to store goods on behalf of other clients based in the EU, but don’t wish to be responsible for the goods whilst they travel from the port of entry to your authorised premises or for any liability from placing the goods under the customs warehousing procedure (such as classification errors). You are responsible for the goods once you accept them into your customs records until you obtain the proper evidence of discharge (which releases your liability, unless you are consignee or jointly and severally liable).
Private - if you wish to import goods that you are responsible for (or own) and are liable for the declaring the goods into the customs warehouse, whilst in storage and obtaining the proper evidence of discharge (which releases your liability, unless you are consignee or jointly and severally liable).
Box 19 - warehouse or storage facilities
Please list all locations that you wish to be authorised.
Plans need to be attached, clearly showing in red, the area(s) for which the authorisation is requested. You should also provide internal dimensions and ensure the full address is clearly written on the plan(s).
Box 20 - deadline for lodging inventory of goods
The first box is the one generally used, as HMRC usually require this information be supplied to us on request. If you wish to use another method then check the second box and give details of your proposed method.
Box 21 - loss rate
Indicate any loss rate that you anticipate (normally only applicable to goods held in bulk storage and to losses occurring after certain types of handling). This needs to be agreed with HMRC before it’s applied. If you do not anticipate any loss then click no.
Box 22 - storage of goods not under the warehousing arrangements
Common storage is the co-storage of the same type of goods having different customs duty status where it’s not possible for you to identify at all times the customs duty status of the goods. If you wish to use common storage please complete the boxes as follows:
- Commodity code- give the eight-digit commodity code for any goods which will be stored in the premises/storage facility and that are not under the arrangements
- Commercial quality and technical characteristics of the goods - give sufficient detail to ensure that they goods are easily identifiable
Category - select the category to which the products belong:
1 = Community (free circulation) agricultural goods 2 = Community (free circulation) industrial goods 3 = non-Community (such as goods suspended in another customs regime, for example processing) agricultural goods and 4 = non-Community (such as goods suspended in another customs regime, for example processing) industrial goods)
Customs procedure - where goods are stored under another customs procedure advise what other customs procedure they are under, for example, free circulation or processing.
Are the goods subject to any customs procedure- please fill in if the goods were subject to another customs procedure, such as processing. If goods are being imported directly to customs warehousing please tick no.
Indicate below if any of the goods above - please tick the necessary box.
Box 23 usual forms of handling
Check the boxes for the UFH that you intend using whilst goods are under the customs warehouse procedure. Unless otherwise specified none of the UFH listed may give rise to a different eight digit Combined Nomenclature code. UFH will not be permitted if, in our opinion, the operation is likely to increase the risk of fraud.
Item 3 should always be ticked to allow for stock taking.
If you have checked item 22 please provide full details of the handling you intend to undertake in the box underneath.
Box 24 - temporary removals
Please note the UCC has removed general authorisations, all temporary removals are on a case-by-case basis upon application to your supervising office.
Supply details of the intended location(s) to which the goods will be removed, and the expected duration of and the reason for the removal(s) including any UFH that will be undertaken.
Box 25 - additional information
In support of your application please ensure that you have attached your comprehensive overview of procedures, specimen of your stock records and plan(s) of your storage facilities. In addition you must supply the following, most will be attachments to your application:
Please send details of the person who is dealing with the customs warehouse application (name, contact number and e-mail address) and the level of disclosure that can be made if this is limited. This must be on company headed paper and signed by a company director/company secretary/sole proprietor/business partner.
A list of authorised signatories and their signatures on company headed paper. These are the people to whom HMRC can disclose information to relating to your warehouse and can request any necessary changes.
If you are happy to correspond by email can you please include confirmation (this can be provided in an e-mail if we accept your application, if you would prefer this please state in this box) that you understand and accept the risks as follows:
The main risks of using email that concern HMRC are as follows:
- confidentiality/privacy - there is a risk that email sent over the internet may be intercepted
- confirming your identity - it is crucial that we only communicate with established business contacts at their correct email addresses
- there is no guarantee that an email received over an insecure network, like the internet, has not been altered during transit
If you would prefer us not to respond to your enquiry by email, for example because other people may have access to your email account, we are happy to respond by an alternative method which will need to be agreed.
The Customs Procedure Codes (CPCs) used on entry to/discharge from the customs warehousing procedure.
Include the CPCs used on entry to/discharge from the customs warehousing procedure.
Whether any goods are to be stored under the customs warehousing arrangements are subject to preference, quotas or licensing (if so please give the necessary details).
Box 26 declaration
The declaration must be made by either:
- a director or company secretary for applications in the name of a corporate body such as a limited company (this must match the details held at Companies House)
- a partner in the case of a partnership
- the proprietor in the case of a sole trader