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Government support for customs intermediaries ahead of Brexit

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The government has pledged an £8m package to support training and automation in the customs intermediaries sector, which includes customs brokers, freight forwarders and fast parcel operators, in the event of a no deal Brexit. This is an acknowledgement of the potential increase in demand for these services. HMRC has also published a new ‘partnership pack’ containing a series of high-level guides to customs processes and procedures.

The new investment will involve:

  • a procurement process to establish contracts with training providers for creating and delivering new training courses and/or expanding existing material for customs brokers to assist in a no-deal scenario;
  • a grant scheme to support intermediaries and/or traders with the upfront costs of training their employees; and
  • a grant scheme to support investment in automation in the sector, as upfront cost is a key barrier to automation, particularly for smaller businesses.

Commenting on the £8m investment, financial secretary to the Treasury, Mel Stride, said: ‘HM Treasury and HMRC have been engaging extensively with the customs intermediaries sector on EU exit, including customs brokers, freight forwarders and fast parcel operators. We have listened to their concerns about the extra demand for customs broker services in the unlikely event that the UK leaves the EU without a deal in March 2019’.

The procurement process for contracts with training providers is expected to start in the coming weeks, with the grant schemes expected to be available in late autumn. The government says it will publish further details in due course. See

HMRC has published a new ‘partnership pack’ containing a series of high-level guides to customs processes and procedures that are likely to apply in a ‘no deal’ scenario (see Although the accompanying guidance stresses that a ‘no deal’ scenario remains unlikely, the pack is provided part of the ‘duty as a responsible government to prepare for all eventualities’. The pack explains:

  • how trade, processes and regulations at the UK border will change after 29 March 2019; and
  • what traders and other businesses operating at the UK border will need to do from 29 March 2019.

It also encourages businesses to register for HMRC’s ‘EU Exit update service’ on GOV.UK.

One of the guides, ‘Changes to customs, excise and VAT you need to know about if there is no deal’, summarises important changes to expect if, in the event of no deal, UK businesses have to apply customs, excise and VAT procedures to goods traded with the EU in broadly the same way as for goods traded outside of the EU. Separate step-by-step guides are included for importers and exporters.

For customs and excise:

  • free circulation and movements of goods between the UK and EU would end;
  • customs declarations would be needed when goods enter the UK, or when they leave the UK;
  • imports into the UK would require carriers of goods to make separate safety and security declarations; and
  • the excise movement and control system (EMCS) would no longer apply to control duty-suspended movements between the EU and the UK, meaning customs declarations would be required;

Actual duty rates that will apply to each item imported into the UK may be different to the rates currently applied under the EU’s common customs tariff. For UK exports to the EU, payment of customs duty will be required at the EU rate. The UK does not plan any immediate deviation from the current commodity code list published in the UK trade tariff.

The UK will continue to have a VAT system after it leaves the EU. As already announced, the government will allow postponed accounting through the VAT return for import VAT on goods brought into the UK.

Low value consignment relief will not be extended to goods entering the UK from the EU, meaning VAT will be payable on goods entering the UK as parcels sent by overseas businesses. A technology-based solution will allow VAT to be collected from overseas businesses selling goods into the UK for parcels valued up to and including £135. Access to EU-wide VAT IT systems such as the VAT mini one-stop-shop will end.

Individual guides are included for:

  • express courier industry and postal services;
  • tour operators;
  • businesses selling duty suspended alcohol, tobacco or fuel in the UK;
  • haulage companies;
  • ferry or channel tunnel operators;
  • freight forwarders;
  • customs agents;
  • ports and airports;
  • customs warehouses; and
  • temporary storage operators.

HMRC says more detailed guidance will be provided later in the autumn, including specific actions that traders and other stakeholders will need to take to prepare.

Issue: 1418
Categories: News , Indirect taxes , VAT