HMRC  opublished new guidelines for companies that outline the key steps in moving to Customs Declaration Service (CDS).

CDS will permanently replace customs handling of import and export freight (CHIEF). CDS is a more modern IT platform, in line with ambitious expectations of the UK government to establish by 2025 the most effective customs system in the world.

Many companies with UK VAT identification number are already using the new CDS system, taking advantage of Deferred VAT (PVA) accounting . This system allows them to avoid paying import VAT when goods are imported into the UK using the reverse charge mechanism on their periodic UK VAT return .

Please note, for non-resident companies – for example EU Amazon sellers – deferred VAT accounting is only available if their customs broker acts as direct representative , which means that he accepts joint and several liability for all liabilities due to EU VAT of the buyer. Few customs brokers are available to accept the risk. This is why so many companies outside the UK have problems accessing PVA, even if they have a UK VAT number + EORI . Sometimes shippers use their own VAT number to clear their goods to their business customers in the UK on deferred VAT accounting: this is a mistake and poses a risk to both the shipper and the merchant concerned. If the courier has exposed you to such a risk, contact us, we will help.

Switching off the CHIEF system will be carried out in two stages:

• From September 30, 2022, the possibility of submitting import declarations will disappear.
• From March 31, 2023, export declarations will no longer be available.

Effective April 1, 2023, the CHIEF system will permanently shut down and all companies will adapt to the new CDS system.

Sign up for a Government Gateway account

Most businesses will certainly already have a Government Gateway account to access their personal or corporate tax account. Businesses will be able to make customs declarations through this account. If the corporation does not have an account, it can register online.

Application for registration and contractor identification number

All companies wishing to import goods into the UK or export goods from the UK must have an EORI number.If an organization does not have such an EORI number, it can apply for one online. EORI is usually received within minutes.

Register on CDS 

Businesses will need to register for the Customs Declaration Service and need to have the following information:

• Government Gateway user ID and password
• GB EORI number
• 10-digit Unique Tax Identification Number (UTR) (for UK businesses)
• company address held by HMRC in its customs records
• Date of commencement of activities

Select the payment method you want to use.

Users can select their preferred payment method for the declaration and check balances and payments in the financial panel of the customs declaration service.

The payment methods are:

• Customs Deferral Account: The Customs Declaration Service uses a separate HMRC bank account for GIEF; therefore, it will be necessary to establish another direct debit.
• Deferred VAT accounting.
• Cash account.
• instant payment via Bacs, CHAPS, online or telephone banking: payment can be made by debit, company credit card or check.
• individual guarantee: can be used to cover customs duties for one-off or high-value imports.
• general warranty account: allows you to provide multiple warranties from one account, thus continuing to import the goods into the UK and paying the disputed amount later upon agreement.

Instruct your broker or customs broker

Provide customs broker with customs clearance instructions.