Preparing for a UK Customs audit

It has been just over two years since the UK left the European Customs Union. With that the learning curve has been tough for all involved. Whether you are a trader, Importer or Exporter of goods,  transport company, government body, Customs Broker, no one escaped the new way of working and as the dust has settled, the reality of UK’s customs environment is being discovered.

The UK government decided to apply easements as part of the BREXIT transition, being mindful of the change on traders. The main easement being the ability to delay declarations for goods imported into Great Britain between January 1^st – July 1^st 2021.

Based on this easement alone, it is estimated that there could be up to 400million customs declarations not made post implementation, equating to around £30bn of unpaid VAT. It remains unclear what this true figure is.

Some of the reasons why the traders failed to declare could be:

• Lack of customs experience
• Misunderstanding of what the easement was – new traders to customs procedures assuming the easement meant that they didn’t have to do anything for the first 6 months.
• Customs controls not managed before BREXIT

With BREXIT and the COVID-19 pandemic well out of the way, HMRC are now looking retrospectively at the work that has or has not been done by traders. In the form of Customs audits and inspections it appears that HMRC are reactively coming after any unpaid VAT. With an article published by HMRC on the 22^nd of February 2023, they are reminding businesses about unpaid VAT , penalties and interest on unpaid amounts.

5 things a trader needs to consider when preparing for a Customs audit:

1. Have you declared everything during the easement period between January 1^st – July 1^st 2021?
2. How accessible are your Customs records with your appointed broker?
3. Do you have proof of Export, if applicable, for goods that have left the country? (including EXW shipments).
4. Do you have a robust Customs program?
5. What is your Customs accuracy and compliance like? Commodity code classification, licensing requirements etc.

How can we help?

Expeditors Customs Brokerage services are designed to offer end to end seamless Customs compliance. Whether it be visibility and accessibility to Customs documentation or guidance on the every changing world of Customs from our knowledge based teams, our global program brings global consistency with local knowledge.

To learn more please feel free to fill out the form or reach out to your local Customs contact.