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HMRC internal manual

Customs Authorisation and Approval

HM Revenue & Customs
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Guarantee Requirements for Customs Authorisations and Approvals: Guarantee reference amounts

An economic operator may be authorised to hold a single, comprehensive guarantee to cover all procedures and types of debts.  This guarantee is made up of separate guarantee limits (reference amounts) for each type of procedure or debt involved: any potential liabilities and any amounts actually payable (article 155 IA).

Each reference amount secures a separate part of the overall liability and care must be taken to ensure that liabilities are not double counted when calculating the overall reference amount for the guarantee.  Please see the example schedule below for details on how to calculate the overall guarantee reference amount:

The overall guarantee reference amount is calculated by adding the actual duty reference amount and the potential duty reference amount together.  In this scenario the guarantee reference amount is calculated as:

Actual Debt Calculation Schedule (Deferment only)        
A B C official use only D official use only E official use only
Tax Type to be deferred Amount of revenue to be deferred Guarantee level authorised Deferment Guarantee limit  
= B / C Actual Debt Guarantee Required
= D X 2          
  Customs Duties £1000 30 £300 £600
  Import VAT £1500 ** ** **
  Excise Duties £2000 100 £2000 £4000
  Totals - actual debts £4500 NA £2300 £4600


·        Actual Debt reference amount (Deferment account limit) = £4500 (column b)

·        Actual Debt guarantee limit for each month’s transaction (deferment guarantee limit): £2300 (column d)

·        Actual debt guarantee required: £4600 (column e)




Potential Debt Calculation Schedule          
A B C D E official use only F official use only
Customs procedure Maximum value of goods within procedure at any time Highest Duty rate applicable to the goods Estimate of Charges    

= B X C%

Maximum liabilities allowed in the procedure at any time (revenue suspended) Guarantee level authorised
  Amount of guarantee required
= D X E%            
  Inward processing £10,000 5 500 30% £150
  Warehousing £20,000 5 1,000 30% £300
  Totals - potential debts £30,000 NA 1,500 NA £450


In this scenario, the Economic operators Comprehensive guarantee authorisation would be issued for:

Guarantee Reference Amount: £6000 Comprising:

  • £1500 potential debts
  • £4500 actual debts

Guarantee Required: £5050 Comprising:

  • £450 potential debts
  • £4600 actual debts

The guarantee reference amount establishes the maximum amount of duty that may be secured or deferred by an economic operator in a given period.

The Guarantee required is the amount of revenue to be covered by a form of financial security (please see section CAA10070 for the forms of guarantee accepted by the UK customs authorities).

If, in any given period, the amount to be secured or deferred exceeds the guarantee reference amounts set then the economic operator will either be required to pay the additional revenue using a different method of payment or the overall guarantee limit will need to be adjusted accordingly.  The guarantee provided would also need to be increased to cover the additional liability.

For example, the deferred amount for Customs duties for the month exceeds £1000.  The economic operator may choose to pay the additional liabilities using a Flexible Accounting System (FAS) account or increase their actual debt reference amount and bank guarantee.

For the available methods of payment, please refer to Volume 3, Part 3 of the Integrated Tariff of the United Kingdom, Box 47e completion rules. 

If the economic operator wishes to adjust the distribution of the guarantee between potential and actual debts, this will need to be agreed in advance by the customs authorities.

If the current liabilities provide sufficient leeway to cover the adjustment then the change may be authorised.  Where there is a risk of the adjusted reference amounts not covering the future liabilities then the overall guarantee reference amount and associated guarantees will need to be increased or individual guarantees used temporarily to cover the shortfall.

If the economic operator opts to use an individual guarantee in these circumstances then no reductions or waivers apply.  Individual guarantees need to cover 100% of the potential customs debt liabilities (article 95(3) of the Code applies).