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HMRC internal manual

Holding and Movements Assurance Guidance

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HM Revenue & Customs
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Excise duty points: irregularities during a movement of goods 'already released for consumption' in another Member State

Regulation 84 of the HMDP Regulations provides for specific duty points when an irregularity occurs during a commercial movement of goods already released for consumption in another Member State (duty-paid goods) which are consigned to a registered commercial importer or an unregistered commercial importer in the UK.

When you are considering making an assessment for duty in relation to duty points that arise under regulation 84, you should consider the interaction with regulation 13 (which provides a duty point when goods already released for consumption in another Member State are subsequently held for a commercial purpose in the UK).

As a general guide, you would normally rely on regulation 84 where a commercial consignment of excise goods is dispatched in good faith and an irregularity occurs, or is detected in the UK during the movement of those goods. (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Note: Within this page distance-selling arrangements are also covered. This is when goods ‘already released for consumption’ in one Member State are consigned to a private individual in the UK.

HMDP Regulation 84 - Irregularity occurring or detected in the UK

This applies where duty-paid goods are consigned to the UK but an irregularity occurs (or there is reasonable evidence to suggest one has occurred) in the UK during the movement of those goods or is detected in the course of that movement. ‘In the course of movement’ means whilst the goods are in transit from the EU consignor to the UK consignee. Where you suspect that an irregularity has occurred you should take all reasonable steps to try and establish where the irregularity took place, and the time the irregularity occurred, before making an assessment.

When an irregularity has occurred in the UK, and the time it occurred is known, that time is the excise duty point. However, if the time it occurred is not known, the excise duty point, under regulation 84(2), is the time when the irregularity is detected.

A duty point also arises when an irregularity is detected in the UK in the course of a movement, but it is not possible to establish the Member State in which the irregularity occurred. In this case the irregularity is deemed to have occurred in the UK and under regulation 84(3), an excise duty point arises at the time the irregularity is detected.

Example when regulation 84 is appropriate

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Payment of the duty

The person/s liable for the duty when an irregularity occurs during a movement of duty-paid goods consigned to the UK are set out in regulation 17. This can differ depending on whether a guarantee has been provided or not.

Liability when a guarantee is provided

When an irregularity occurs during a movement of duty-paid goods, regulation 17(2)(a) places the liability to pay the duty on the person who provided the guarantee. Normally this would be the person approved as a registered commercial importer or the person acting as an unregistered commercial importer.

A registered commercial importer must secure the duty through duty-deferment arrangements using his own or another person’s duty-deferment account. An unregistered commercial importer must secure the duty via a banker’s draft, postal order or cheque. They can also arrange for another person to secure the duty on their behalf, but it is the unregistered commercial importer who will be held liable to pay the duty in the event of an irregularity.

Joint and several liability

Regulation 17(3) also provides a joint and several liability on those person/s who participated in the irregularity. However, before you decide to notify a joint and several liability, you must have sufficient evidence to show that the person did participate in the irregularity. (This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000) (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Liability when a guarantee is not provided

When the goods are consigned under duty-paid arrangements but there is no valid guarantee in place, regulation 17(4)(i) provides that the person who is liable for the duty is the person who participated in the irregularity. Where more than one person participated in the irregularity, each person is jointly and severally liable to pay under regulation 17(4)(ii). Under this particular provision, there is no need to make an assessment and notify the joint and several liability separately. Instead you should make one assessment which should be notified to all of the persons who are liable for the duty under regulation 17(4)(i) and 17(4)(ii).

Where liability falls outside of the UK

If at any time, you establish that the irregularity occurred in another Member State, the duty is due in that other Member State. In this case, the person who paid the UK duty is entitled to claim a repayment of the duty under regulation 85, provided that:

  • there has been an excise duty point as prescribed by regulation 84(3),
  • you ascertain within three years of the start of the movement that the irregularity occurred in the other Member State, and
  • the duty has been paid (or no duty was due) in the Member State where the irregularity occurred.

Any claim must be made in writing and include evidence to satisfy you that the duty has been paid (or was not due) in the Member State where the irregularity occurred.

HMDP Regulation 16 - where excise goods are imported under a distance-selling arrangement

The most common form of distance-selling is when goods are ordered via the internet and delivered to the UK by post or parcel carrier. Under a distance-selling arrangement the duty point arises under regulation 16(1) of the HMDP Regulations. That is the time when those goods are charged with duty at importation.

The overseas vendor is responsible for ensuring that UK duty is secured before the goods are dispatched. The vendor must appoint a tax representative in the UK to account for the duty in the UK. You will find more information on distance-selling in Notice 204B (HMRC website).

Payment of the duty

When a UK tax representative has not been appointed to account for the UK duty, the person/s liable for the duty are set out in regulation 16(3). Under regulation 16(3)(a), the vendor is liable to pay the duty. However, if before the goods are dispatched, the vendor has not notified HMRC about the importation or guaranteed the UK duty then, under regulation 16(3)(b), the consignee is liable to pay the duty.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

There is no joint and several liability provision in regulation 16.

HMDP Regulation 17 - Irregularity occurring or detected in the UK during a distance-selling movement

Where an irregularity occurs in the UK during the movement of goods under a distance-selling arrangement, then an excise duty point arises under regulation 17 of the HMDP Regulations. This is the time specified by either:

  • regulation 84(2), if you are satisfied that the irregularity occurred in the UK, the duty point is the time when the irregularity occurred or when it was detected, or
  • regulation 84(3), if it is not known in which Member State the irregularity occurred, the duty point is the time when the irregularity is detected.

Payment of the duty

The person normally liable to pay the duty is the tax representative for the movement under regulation 17(2)(b). Where a tax representative has not been appointed, then this provision also places the liability on the overseas vendor.

Joint and several liability

Under regulation 17(3) any other person who participated in the irregularity is jointly and severally liable to pay the duty. However, you must be able to show how the person you consider is jointly and severally liable participated in the irregularity.

Where liability falls outside of the UK

If at any time, you establish that the irregularity occurred in another Member State, the duty is due in that other Member State. If a person has paid the UK duty, they are entitled to claim a repayment of the duty under regulation 85, provided that:

  • there has been an excise duty point as prescribed by regulation 84(3),
  • you ascertain within three years of the start of the movement that the irregularity occurred in the other Member State, and
  • the duty has been paid (or no duty was due) in the Member State where the irregularity occurred.

Any claim must be made in writing and include evidence to satisfy you that the duty has been paid (or was not due) in the Member State where the irregularity occurred.