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THE POWER
OF BEING
UNDERSTOOD
AUDIT | TAX | CONSULTING
DO YOU HAVE CONFIDENCE IN YOUR CUSTOMS
DUTY POSITION?
Find out whether your customs duty arrangements are working by using
our guide to identify potential risks and opportunities.
DO YOU HAVE
CONFIDENCE IN YOUR
CUSTOMS DUTY
POSITION?
Recent experiences have
highlighted the significant impact
on margins that any mistakes
in applying customs duty rules
can have on businesses – from
incorrect valuations on products
leading to a deficit of duty being
paid, to reliefs for rejected
or returned goods not being
appropriately claimed.
Answer these questions to help
evaluate your customs duty profile:
1
Do you know how much your
company is paying in customs duty
across the EU? yes/no
2Are you confident you are paying the
right rate of customs duty? yes/no
Yes to all
Many businesses successfully use
import agencies to clear goods.
However, whilst diligent, speed of
clearance is usually their priority and if
any customs duty is due, responsibility
lies with the business. It is therefore
important to review your arrangement
to ensure you accurately account for
customs duty.
To provide you with confidence in your
customs duty arrangements, RSM has
designed a guide which will help you
identify key areas of uncertainty – and
potential risks and opportunities.
Still have questions?
Our specialists can advise on
how forthcoming changes to
customs duty might impact
you, and help you navigate
these changes to give you the
confidence that you understand
and are prepared for these new
developments. For further
information please contact your
usual RSM adviser.
2
Our survey indicates
that you can have a fair
degree of confidence in your
existing customs duty arrangements.
But, have you considered the impact
of the 2016 customs duty changes? If
you are importing goods in to the UK or
elsewhere in the EU you should read our
‘Key issues’ of the European Union
Customs Code addressing the new
rules which come in on
1 May 2016.
THE POWER
OF BEING
UNDERSTOOD
3Have you ensured you
are claiming suitable reliefs? yes/no
4Have you considered whether certain
reliefs, such as a customs warehouse,
could save you money? yes/no
5Do you make use of reliefs available
for rejected goods, returned goods
etc? yes/no
No to 1
or more
Your answers indicate that
you may need a bit more
information on managing your
customs duty arrangements.
Are you aware of specific
changes taking place in relation
to customs duty?
RSM might
be able to help you
identify possible costs
and savings. In addition if you
are importing goods in to the
UK or elsewhere in to the EU you
should read our ‘Key issues’ of the
European Union Customs Code
addressing the new rules
which come in on
1 May 2016.
Good news. However, to
ensure you are on top of
developments and to retain your
level of confidence read our ‘Key
issues’ of the European Union
Customs Code addressing the
new rules which come in on
1 May 2016.
3
KEY ISSUES OF THE 1 MAY 2016 EUROPEAN
UNION CUSTOMS CODE
Major changes are just around the corner, as on 1 May 2016 the
European Union Customs Code comes into force, replacing the
existing European Community Customs Code. If you import goods
into the EU, it could impact you in the following ways:
More information
Our advisers would be pleased to talk
to you about the customs duty changes
and specific savings you could make.
To discuss further, please contact your
usual RSM adviser.
• Increase in the financial guarantee required – Any UK business operating a
customs warehousing or utilising inward processing or other customs duty
reliefs, will need to provide a financial guarantee to cover the annual amount of
potential duty that could be due. This change is expected to result in additional
costs for the guarantee provision, as well as potential restrictions on working
capital facilities in providing security to the guarantor.
• The absence of Authorised Economic Operator (AEO) accreditation may result
in additional cost – AEO is a supply chain systems accreditation, approved
by HMRC. To qualify, a business needs to be able to demonstrate that its
processes are customs compliant – a process that takes up to 6 months to
achieve. Companies without AEO accreditation may struggle to qualify for
suspensory regimes and may not be able to access guarantee waivers.
• Duty liability of royalty payments – An increase in duty costs? Customs duty
currently applies to royalty payments. However this is limited to where such
payments are a condition of sale/import of affected goods. This limitation is
expected to be removed and therefore other royalty payments will be subject
to customs duty. Agreements which give rise to the payment of a royalty in
respect of imported goods should be reviewed to determine whether there are
any mitigation opportunities to reduce the expected increased in duty cost.
• Customs valuation changes – Removal of first sale opportunity – The basis
of customs valuation when importing goods is expected to change. It is
likely to mean that the opportunity to use the ‘first sale for export’ value will
be removed with instead, customs valuation being based on the final sale
before import. There is expected to be a transitional period but this change
will eventually lead to an increase in customs duty costs for those that are
currently using the first sale relief.
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