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Posted 8th December 2020

Delaying duty and VAT payments

When your shipment reaches its final destination, you can decide whether to delay duty payment, or have goods in free circulation immediately.

When your goods arrive into the UK, you can choose what happens to them next:

  1. Declare the goods into free circulation and pay VAT and possible duties straight away; or
  2. Hold the goods in a facilitation. Sometimes, you might not need your imports for a while. They might be stored while waiting to be used, worked on or sold. If this is the case, it may be possible to suspend the payment of duties and taxes – to improve your cash flow (and in some special circumstances, not have to pay them at all).

The example above shows imports to the UK, but this works in the same way for exporting to other countries too. Arranging the suspension of paying duties and taxes is something we can help you with. There are a few different ways to do it – these are the most common:


External Temporary Storage Facilitation

  • This allows the goods to be held for 90 days
  • At the end of this time, goods must be customs cleared (and VAT and duties be paid) or be re-exported


Bonded Warehouse

  • Shipments are left in a warehouse until the taxes are paid. This is most often used for goods where the taxes are high, including for high value goods, alcohol and tobacco.
  • Goods can only be moved out of the warehouse for in two circumstances:
    • Duty paid, customs cleared and goods move into free circulation
    • Documentation needed for goods to move into a different facilitation


Inward Processing Relief (IPR)

  • This is a way of suspending VAT and duty payments for imports which will later be exported – such as importing parts used to make a new product.
  • If the parts are in a final product which will be exported from the UK within 6 months:
    • With an IPR number: the importer does not have to pay duty on the goods
    • Without an IPR number: if there is documentation to prove this, the duty can be paid on deposit and refunded when proof of export is provided


Outward Processing Relief

  • This is similar to inward processing relief – except it’s used when you export something, which will later be re-imported
  • Click the link above to read more and apply


Bond-to-Bond Transfer

  • Transfer shipment from one warehouse to another
  • Must move with appropriate documentation including guarantee
  • This moves the liability and responsibility to a new warehouse, meaning the new warehouse bond holder now has the duty liability


If you have any questions, our in-house Brexperts are here to help! Call 0115 975 0400 or email today.