Business tax – guidance

Customs warehousing

Customs warehousing offers traders a storage facility that delays the payment of VAT and import duty


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 warehouse-keepers, who must be authorised by HM Revenue & 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 European Union are eligible for storage in a customs warehouse, and Common Agricultural Policy (CAP) and community goods may also be stored on the premises of a customs warehouse in certain circumstances.

This guide explains in detail the different types of customs warehouse available so you can see which suits you best. You can also find out what types of goods are eligible for storage, the documentation you need to enter, store and, where authorised, undertake a usual form of handling in a customs warehouse, and how to apply to operate your own customs warehouse.

This section on customs duty reliefs contains detailed guidance.

Use our interactive tool to understand what customs procedures and reliefs apply to your business

When to use customs warehousing, eligible goods and types of customs warehouse

Customs warehouses are premises or systems that are 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 are 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 for non-excise goods
  • you wish to store your goods together with goods subject to another customs procedure with economic impact (eg Processing under Customs Control, Inward Processing) or with goods that are already in free circulation.

Eligible goods

To be eligible for customs warehousing, your goods should have been imported from outside the European Union (EU) and be liable to customs duties and/or import VAT, or be moving in duty suspension from another member state - eg the goods have been entered to a duty suspension procedure in another member state or are moving under Community Transit.

You can also, if suitably authorised, use the customs warehouse procedure to store CAP goods that are eligible for an export refund or Community 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.

Types of customs warehouse

There are two main types of customs warehouse:

  • A public warehouse (Type A) is operated by a warehouse-keeper for the storage of goods placed under the customs warehousing procedure by other traders known as depositors
  • A private warehouse can be used to store goods deposited by an individual trader who is authorised as the warehouse-keeper. The warehouse-keeper need not necessarily own the goods, but they must be the depositor.

There are three types of private warehouse:

  • Type C premises-based warehouse
  • Type D premises-based warehouse - the trader is authorised to release goods for free circulation under the Local Clearance Procedure (LCP). Any duty due on removal is based on the classification, value and quantity of goods applicable on entry to the customs warehouse
  • Private Type E customs warehouses where a record-keeping system is authorised (instead of premises) and which traders can also be authorised to release goods for free circulation under LCP if required. However, the authorisation for this is stricter than for Types C and D.

Read about the additional conditions for a type E customs warehouse in Notice 232.

Additional controls exist for warehouses used to store excise goods.

Even though warehouse-keepers may not own their premises, they must keep stock records and maintain and operate the warehouse in a way that meets health and safety requirements.

While type B and F warehouses exist within European Community legislation they are not available in the UK.

Operating a customs warehouse: authorisation and responsibilities of warehouse-keepers and depositors

Many traders choose to set up as warehouse-keepers and operate their own private customs warehouse, either premises or systems based. A customs warehouse must be authorised by HMRC before it can accept goods for storage in duty suspension. To be authorised, your business must:

  • be established in the EU
  • use the warehouse primarily to store goods
  • prove there is a real economic need for a customs warehouse and that you will have enough clients or business to make the operation viable
  • be able to comply with the conditions of authorisation

You may also have to provide a financial guarantee. HMRC will need to make additional checks on businesses who want to establish a Type E warehouse. For example, your accounting system must be authorised by HMRC and payment of duties under CFSP must be secured by the deferment arrangements.

To apply for UK authorisation or to use the arrangements in a type E warehouse, you must complete HMRC form C1410. Send the completed form to your local Customs authorising office.

If you want to use the customs warehousing procedure and then want to enter goods to another Customs procedure (such as Inward Processing) without a full declaration being required, you should apply for an integrated authorisation on HMRC form C1410.

If you will be carrying out storage operations in more than one member state you may apply for a single authorisation by completing the model application form in Commission Regulation 2454/93 (Annex 67). You must use the European Community application form. Mark the form ‘SA-CPEI ONLY’. Read about customs warehousing in Notice 232.

Find a copy of the EC customs warehouse authorisation application form C1410.

Traders may also wish to apply for CFSP, see Notice 760 to import goods under the customs warehousing procedure.

Warehouse-keepers’ responsibilities

Warehouse-keepers’ responsibilities include:

  • complying with conditions contained in their authorisation
  • checking the goods on arrival to account for any shortages or surpluses of goods, allocating stock numbers, and keeping them secure and under supervision
  • maintaining stock records for at least four years
  • allowing HMRC officers access to the warehouse, the goods, and their records
  • maintain the premises safely and run the warehouse in a way that meets Health and Safety requirements

Type E warehouse-keepers may require additional checks.

If you choose to use a public customs warehouse you are a depositor and take responsibility for the declaration which places the goods under the customs warehouse procedure. You have particular responsibilities to:

  • 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 (within five days of your customs declaration)
  • provide the warehouse-keeper 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 are also responsible for customs debt. If you are using a type A warehouse you must give the warehouse-keeper all the details of your customs declaration for their records and make sure that the warehouse-keeper holds a valid customs warehouse authorisation for the type of goods you wish to deposit.

Authorise an agent to make declarations on your behalf

There are two types of representation:

  • direct representation - the agent enters goods in your name and on your behalf but you are still responsible for any customs debt that may arise from errors
  • indirect representation - the agent enters goods in their own name on your behalf and they are jointly liable with you for any customs debt that may arise from errors

Warehouse-keepers and depositors must always give clear written instructions for the goods to be entered, and make sure they check details of their goods on any paperwork. If you are a depositor and have authorised an agent to enter goods to a public Type A warehouse, you are responsible for checking that the agent sends the correct paperwork to the warehouse-keeper.

If HMRC officers make a decision that you disagree with, you can appeal within 30 days. HMRC will tell you what you need to do if you disagree and will offer you a review.

Enter goods into a customs warehouse

Traders can enter goods into a customs warehouse in several ways:

  • directly from import (including from Community Transit)
  • from a Free Zone
  • after Inward Processing
  • after Processing under Customs control
  • after repayment of import duty has been approved on rejected imports
  • after temporary admission

Once you have checked availability at the warehouse of your choice, you or your agent must complete the Single Administrative Document (SAD) form C88 and present it to HMRC.

You should take care to fill the SAD correctly as errors made on this form could leave you liable to a Customs debt.

Further information on the boxes which require completion when a declaration is made to customs warehousing can be found in Volume 3, Part 3 of the UK Tariff.

You can also see information on all the boxes that need to be filled in the guide on Declarations and the Single Administrative Document

Goods must be moved to approved premises within five days of your declaration to customs warehousing being made.

Handling and storing goods in customs warehouses

Customs warehouses are for the storage of goods, but some minor handlings - known as ‘usual forms of handling’ - are allowed in order to:

  • ensure goods are preserved
  • improve their presentation or marketable quality
  • prepare them for distribution or resale

Usual forms of handling must be authorised by HMRC prior to the handling taking place. Generally this will be at the same time as authorisation to operate the customs warehouse is granted. You can remove samples from the customs warehouse with prior authorisation from HMRC. Complete HMRC form C1410 to operate customs warehouses or use arrangements in Type E warehouses.

You can also remove goods from the warehouse on a temporary basis to undertake a usual form of handling provided you return them within three months. You must keep records and obtain HMRC authorisation in both cases. Find out more on handling customs warehousing goods in Notice 232.

You can process goods further if you transfer them to Inward Processing. However, there must be an intention to re-export the goods. Find out more about Inward Processing in the guide to Inward Processing.

Co-storage and common storage

Co-storage allows you to maximise your available warehouse space by permitting the storage of Community goods and non-Community goods. You can also store IP goods and PCC goods providing the status of your goods can be identified at all times. You must inform HMRC and keep full records.

If you are unable to identify the customs duty of your goods held under customs warehousing, Inward Processing or PCC at all times you can still store them together in common storage. However, the common storage arrangement only applies to goods that share the same eight-digit commodity code, the same commercial quality and the same technical characteristics.

Releasing customs warehouse goods to free circulation and paying duties

Release to free circulation means removal of the goods from the customs warehousing procedure.

Paying duties on goods being released from the customs warehousing procedure

When your goods are released from the customs warehousing procedure, you may have duties and taxes to pay. You can work them out using:

  • the Tariff description (from Volume 2 of the Tariff) and rate of duty
  • the quantity and/or the value
  • HMRC official rate of exchange

You may also have to pay import VAT at this time - see the guide on Classification rules and the Tariff. For further information you can find guidance in Notice 702/9 for import VAT.

The valuation of goods for the calculation of import duties is based - in a Type D warehouse - upon entry into the warehouse, while for A, C and E Type warehouses, the value of the goods is determined upon removal.

Discharge of customs warehousing to another customs procedure and transferring goods between customs warehouses

Discharge to another customs procedure

You can discharge your liability to a customs debt for customs warehousing goods if you enter the goods to another customs-approved treatment or use, for example re-export. A declaration must be made on a Single Administrative Document (SAD) form C88 using the customs procedure code applicable to the procedure you wish to enter. You can find out more about how the SAD works in the guide to declarations and the Single Administrative Document.

Find out details of the requirements of specific customs procedure codes in the guide on Single Administrative Document duty and transit codes.

Transfers to other warehouses

When you are authorised to use a customs warehouse, HMRC will tell you which methods you can use to transfer goods. They may also ask to examine your goods. The dispatching warehouse-keeper must make sure that the receiving warehouse-keeper is authorised to receive them, as well as to handle any simplified transfer procedures.

You can transfer your goods to another customs warehouse (only) using:

  • the SAD form C88 using the copy 3 of the SAD (normal procedure)
  • using copy 2 of the SAD
  • Community Transit - see the guide on Community Transit
  • commercial documents
  • full declaration procedure

Entering goods to Community Transit

Community Transit is the European Community’s system for moving non-Community goods within the EU on which Customs duty and/or other import charges have not yet been paid.

Community Transit can be used to discharge goods from the customs warehousing procedure if authorised. Find out about Community Transit procedures on the Europa website.

See the guide on Community Transit.

Receiving goods from another customs warehouse

To receive goods from another customs warehouse, you must be authorised for Local Clearance Procedure receipts.

SAD transfers

Under the normal procedure, traders can use the copy 3 SAD to transfer goods between customs warehouses.

To save time and avoid the need to inform HMRC in advance, you can also - if authorised - use a simplified transfer procedure using only copies 1 and 4 of the SAD.

Find information about completion of the SAD for transfers in Notice 232.

Commercial documentation

Commercial documents may also, if authorised, be used to transfer goods. Your local Customs supervising office will tell you what information needs to be provided.

Full declaration procedure

You may choose to discharge your liability to any customs debt due on the goods at the time they leave your warehouse. To do this you can make a full declaration to HMRC (completing the SAD C88 as required by the UK Tariff). You should ensure that the trader to whom the goods are being dispatched is aware that you are making a declaration to their warehouse and you should advise them of the full particulars of the declaration.

Importing to customs warehouses using Customs Freight Simplified Procedures

CFSP can be used to import goods. Traders who want to use CFSP must be authorised to do so. As the system is electronic, benefits include reducing paperwork and approval times. See the guide on Customs Freight Simplified Procedures.

Goods can be admitted to customs warehousing under SDP or under the Local Clearance Procedure, with the appropriate conditions met for that type of procedure. If you choose to use SDP to enter your goods, additional procedures apply depending on the type of warehouse.

Applications for CFSP can be made alongside applications to operate a customs warehouse.

To be authorised, traders and agents will have to show that they meet a range of enhanced conditions regarding accounts and records, customs compliance and solvency. These enhanced criteria will need to be in place in your business before HMRC can grant authorisation - customs officers may visit your premises to verify your systems and paperwork.

Find form C&E 48 to apply for CFSP.

Find CFSP information in Notice 760.

Entering goods using CFSP

CFSP can be used to enter goods to and remove goods from a customs warehouse, provided a valid CFSP authorisation is held. Under CFSP, formalities at the frontier are kept to a minimum with the bulk of fiscal and statistical data being supplied electronically to Customs Handling of Import and Export Freight at a later date, however there are some exceptions.

Removing goods from customs warehouses for re-export

The National Export System can be used to re-export goods. As the system is electronic, benefits include reducing paperwork and approval times.

See the guide on export declarations and the National Export System.

Further information

[Imported goods customs procedures and debt public in Notice 199.