Thought I'd drop this one into the blog again as only last week, we took on a new client where the Customs classifications needed a complete review, and the overall impact is that they are paying twice the rate of duty they should. Thank goodness we came along. It also turns out that they are not claiming allowable duty reliefs on imports from certain developing countries. This will have a huge impact on their landed costs as you can imagine. I suppose the question many customers would ask is, "Well, if we're paying the freight forwarder to bring the goods in and clear them, isn't that their responsibility?" Actually, it's not and to be honest, they have no interest in whether your duty rate is 5%, 2% or zero. They are often very focused on the delivery and getting the shipments billed out and on to the next shipment..I should also mention that we are likely to also save them around 25-35% on their freight costs. Big numbers.
So, to summarise, never assume that your imports are being correctly classified or that your freight or duty costs are as sharp as they could be.
. If you're a UK importer, you have responsibilities to HMRC as the importer. 99% of UK importers will use a freight forwarder or Customs clearance agent to get their air and ocean shipments cleared through Customs so they can take delivery and either get it into production, or out to their customers - job done!
Just a word of advice. When you use a freight forwarder to carry out the Customs clearance for you, they're (99 times out of a 100) acting as a Direct Representative. So what the heck is that? It means that although they declare the goods to Customs and sign the Customs Entry (C88), you're liable as the importer for the accuracy of the entry.
That means some fundamental things such as:-
1 - Correct tariff classification (which affects the duty rate payable)
2 - Correct value delcaration
3 - Correct currency code
4 - Declaration of marine insurance (dutiable)
5- Declaration of correct freight charges (dutiable)
6 - Correct/appropriate Customs regime (home use/IPR/OPR)
7 - Value delcaration (is the value on suppliers invoice genuine)
There are others too but these are the main ones.
HMRC have issued leaflets to remind customers of their responsibilities in this area (see below photo) however they're not well publicised and the wording inside may be confusing to the average UK importer (who has most likely never completed a Customs entry in their life!).
We carry out Customs Compliance work for many of our import customers so they know they're compliant, they're paying the right amount of duty, the correct tariff codes are being applied for the different products they import and they're taking advantage of any Customs duty reliefs which are available. The other big benefit is the obvious one - peace of mind, it's being managed, if we get a Customs visit, we can show we carry out a compliance process to ensure any errors are picked up and corrected.
http://www.straightforwardconsultancy.co.uk/
This was how we uncovered a £ 26,000 duty overpayment for a Warrington customer earlier this year, importing catering equipment from the US. The mistake went back 7 years but we can only reclaim 3 years worth of overpaid duty (127 Customs entries).
Please let us know if you need any advice regarding compliance as well as any general freight or logistics advice it's what we do (and what we're really good at).
Kind Regards
Andy
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