ACCOUNTANCY BLOG

Customs Declaration Service

HMRC had been using a system called CHIEF to handle customs services for imported and exported goods up until the end of this September. As of 30th of September 2022, HMRC moved the customs services to a new system, CDS, which stands for customs declaration service. Therefore, as of the end of September, all customs […]

HMRC had been using a system called CHIEF to handle customs services for imported and exported goods up until the end of this September. As of 30th of September 2022, HMRC moved the customs services to a new system, CDS, which stands for customs declaration service. Therefore, as of the end of September, all customs declarations for imported and exported goods will be made via the new system, CDS.

To sign up for CDS, you need to follow the steps below. But before going deeper into the steps to sign up for CDS, please keep in mind that you need to have a valid EORI number (You can obtain an EORI number from https://www.gov.uk/eori/apply-for-eori)

Steps to take

Step 1: Click on the link https://www.gov.uk/guidance/get-access-to-the-customs-declaration-service

Step 2: Click on “Subscribe Now”

Step 3: Fill in the necessary fields with your Government Gateway ID and password. Please bear in mind that you need to use the same Government Gateway ID and password that you used when you obtained your EORI number.

Step 4: Answer the following questions

  • What email address can we use for customs notifications? (Enter the email address you would like to get notifications)
  • What is your GB Economic Operator Registration and Identification (EORI) number? (Enter your EORI number)
  • Where is your organisation established? (Select United Kingdom if it is established)
  • What do you want to apply as? (Select Company or Sole Trader according to your business structure)
  • What are your company details? (Enter your registered company name)
  • Unique tax reference number? (Enter your company’s UTR number)

Step 5: Please keep a record of your Government Gateway ID, password and your EORI number as these credentials will always be needed for using this service.

Step 6: After signing up for CDS, you can use the authorised software to make your customs declarations.  https://www.gov.uk/guidance/list-of-software-developers-providing-customs-declarationsupport

Step 7: https://www.gov.uk/guidance/using-the-trader-dress-rehearsalservice in this link, you will find information on how to use the CDS in general and the case studies with possible scenarios you might encounter while making your declarations. 

If you find the process hard to understand or time-consuming you can always consult customs specialists or companies providing customs services. 

VAT on imports

When importing goods to the UK, you will need to pay the VAT on import amount determined by the system. In this aspect, there is no change in the way of processing your payments or the system. Please keep in mind that customers who are not registered to VAT must pay the VAT on imports amount determined by the system and there is no way they can reclaim this amount from HMRC later on.

4 options in CDS to pay VAT on import for VAT registered customers

1. Immediate payment import VAT:

You pay the VAT amount immediately and this amount is reclaimed in your next VAT return.

2. Duty deferment account:

In this option, you set up a Direct Debit standing order and rather than paying the full amount, you pay your import VAT amount regularly in instalments.

3. Postponed import VAT:

If you select this option, you won’t need to pay any import VAT amount and since you did not pay it, there is nothing to be reclaimed in your VAT returns.

4. Cash account:

This works like a top-up account that you can transfer money into anytime you wish and any import VAT payment is deposited from the balance of this cash account.

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Customs Declaration Service

HMRC had been using a system called CHIEF to handle customs services for imported and exported goods up until the end of this September. As of 30th of September 2022, HMRC moved the customs services to a new system, CDS, which stands for customs declaration service. Therefore, as of the end of September, all customs […]