March Newsletter

Welcome

Welcome to the latest issue of our newsletter. In this issue, we tackle the somewhat complex area of VAT on imports, and how to obtain VAT refunds if you import through the UK but are based elsewhere in the EC. We offer you an update on our services and our usual Q&A spot, as well as another coffee-break story to get you thinking.

So enjoy the issue and don't forget, for any customs and importation queries, meet our friendly and approachable Customer Services team on +44 (0)20 8231 0900 your first port of call.

In this issue

Getting your VAT Returned
Making Life Easier: Secure On-line Payment
Your One Stop Shop
Q&A - Everything you wanted to know about importing, but were afraid to ask!
Coffee Break Story: I Had It!

Getting your VAT Returned

Do you remember this quote? It came from Benjamin Franklin: "Certainty? In this world nothing is certain but death and taxes."

Well, taxes are indeed a certainty, but you may not realise that if you're a business based in the European Community, and you import for destinations in Europe via the UK, you can reclaim the VAT you pay on import to the UK - and that's whether you're based in the UK, or anywhere else within the EC.

Customs Clearance Ltd in the UK acts as 'European Gateway' for businesses importing to Europe. We handle inbound shipments, including processing through customs, paying duty, warehousing and even break bulk and onward shipping to multiple destinations. We help make your life easier by navigating and advising on the complexities of customs, importation, duty and VAT.

Customs Clearance via CHIEF

First things first. If you are registered for VAT in the UK you will need a TURN (Trader's Unique Reference Number) to enable your inbound commercial shipments to be cleared through the automated customs import/export processing system CHIEF. This is made up of your VAT number, plus a further 3 digits. If you are registered for VAT elsewhere in the EC, you will need what's known as a Pseudo TURN number - more of which, below.

Paying VAT on Imports

When importing to the UK, or via the UK into other EC countries, VAT is payable on all imports at the same rate. If you are registered for VAT in the UK and you import goods from inside the EC, you enter the VAT details on your VAT Return as 'acquisition tax'. If importing via the UK from outside the EC, you must also declare and pay VAT on all imports but in this instance, it is the Single Administrative Document (SAD) that is used, and import VAT and duty will need to be paid before HMRC releases your goods. If you're a regular importer, you can defer paying import duty and VAT by around 30 days, by setting up an account with HMRC.

Reclaiming VAT on Imports

If you're registered for VAT in the UK: In general, you can reclaim the import VAT that you've paid for business goods. The normal evidence of payment of import VAT is the import VAT certificate (Form C79), which is issued monthly. If you are registered for VAT in the UK and importing from the EC, reclaiming the VAT paid on EC imports occurs via your VAT return for the period during which the goods were imported, just as if the goods were supplied in the UK. If your imports from the EC exceed an annual amount (currently £233,000) you may need to complete a supplementary declaration. In both instances, you must be the direct consignee and not the middle handling import agent.

If you're registered for VAT elsewhere in the EC: If you are registered for VAT in any of the Member States of the EC, you can reclaim VAT paid in the UK provided that you:

• are not registered, liable or eligible to be registered in the UK
• have no place of business or other residence there and
• do not make any supplies there (other than transport services related to the international carriage of goods).

In the first instance you will need to have obtained a reference number called a Pseudo TURN (Trader's Unique Reference Number). In addition to enabling your imports to be processed through the automated CHIEF system, this reference number acts by way of a substitute for your local VAT reference number. You can apply for a Pseudo TURN via form C219, downloadable from the HMRC website.

There is no maximum amount that you can claim back, but each EC Member State has a minimum refund amount, and there are regulations governing the periods for which you can claim.

Claims forms must be submitted with all the information needed to process the claim, including invoices, the VAT copy of the import entry or other customs document showing the amount of VAT that you have paid and, if applicable, a certificate of status from your tax authority, showing that you are registered there for VAT. You will receive your refund of VAT paid in the UK within 6 months of claiming.

Acting as your Agent

VAT, duty and importation regulations are without doubt complex matters, and we have scratched the surface simply to pass on a few pointers. Engage CCL as your Agent to deal with all matters of customs and importation and we will be able to take care of all processing and payment matters on your behalf. We can advise you, assist with applications and forms completion and, of course, help you with your customs declarations. We can help ensure your shipments are processed in the shortest timeframes, and in the most advantageous way for your business, and that all the processes are in place to enable you to minimise your import/export financial burdens.

Finally, you will of course find detailed information on VAT and import duty and the ins and outs of importing and exporting on the HM Revenue & Customs web site at www.hrmc.gov.uk. For specific advice in relation to your own business, you can also call the HMRC National Advice Service on 0845 010 9000.

Return to top

Making Life Easier: Secure On-Line Payment

As part of our ongoing ambition to continually improve the services we offer, we've just added an on-line secure credit card payment mechanism to our facilities.

This means that in future, customers will be able to make payments on-line against the invoices we send. You will be able to pay multiple invoices at once and check-out via HSBC's Secure e-Payments system. Look out for the link to on-line payments on invoices from now onwards!

Return to top

Your One Stop Shop

Customs Clearance Ltd is a specialist in the business of customs and importation. Our team are experts, and you get the best advice and the most advantageous terms. But you may not know - there's more to us than this.

Throughout our years in business, we've cultivated a network of trusted business partners - companies which supply related and complementary services to our own. Our trading relationships are strong and well established.

Today, this means we can be a One Stop Shop for all your shipping needs - from documents through freight of all kinds, from letters and parcels to air and sea shipments. We can offer a fully end-to-end service, from pick-up anywhere, to delivery to single or multiple destinations. And, of course, we will always take care of all the customs proceedings for you.

We're not a 'jack of all trades'. Through us, you get access to a range of experts - trusted suppliers, each a specialist in their field. Through our business relationships with these suppliers, you get best value and best quality service.

So, for all your shipping needs, import or export, by road, air or sea, whatever you're moving around, call us first. Gain access to our network of trusted partners, and reap the benefits of our long-standing business links.

Return to top

Q&A - Everything you wanted to know about importing, but were afraid to ask!

Each issue, we answer in brief one or two of your more specific customs and importation questions.

Q: I want to import specialist cured meats from Eastern Europe - how does this get handled by Customs?

A: This is a very complex and sensitive area. It's not just a customs and excise issue, it's also a health and safety issue. We can guide you through providing us with the correct documentation including invoices, packing lists and valid health certificates. You will need to give us a full description of your meat produce and we will advise accordingly

Q: Now that my business has grown, I don't have enough warehouse space to store my shipments - can you help me?

A: Yes we can. We can import your consignment from anywhere in the world and store it for up to a set period of time at a very competitive rate. If you want us to unpack, sort into individual orders and then redistribute your product, we can do this too. We take away the stress of storage and distribution management, leaving you to focus on sales.

Q: I'm importing a range of printers inks and I've been told these may considered to be 'hazardous' items. What's the deal here?!

A: If the airline accepts the inks then you're 'good to go'. If they refuse them, you have a problem. The best approach is to give us a complete breakdown of the individual types of inks, complete with ingredients etc. We will check with our overseas agents and the airline of origin to determine if these are classified as hazardous or not. Materials classified as 'hazardous' will require specialist handling. Either way we can give you peace of mind.

Return to top

Coffee Break Story: I Had It!

We continue our series of 'coffee break' stories for you. Enjoy!

I had it. In my mind I had it all worked out; I'd played it out - I knew how it had to be done. I had the product, the marketplace and a hungry sales team and I just knew, given the right ingredients in the right combination, that my team would perform 110% and capture the customer base. What I didn't have was the overseas office, staff and, critically, credentials.

I needed to get to the UK to sort it all out.

I arrived at Heathrow after a very long overnight flight, turned a corner and walked into a line - at least 300 or 400 people - and I was at the back of the queue, rapidly losing the will to live. You can imagine I was a little tired. I hadn't got much sleep on the plane, with so much on my mind. I had to get this right and I only had 5 days to do it in. I had a game plan but no real structure to my approach. Get in, find some suitable premises in a good location, do the deal and secure the premises, then get out. That's the primary goal; all else can follow. I had a hotel reservation, a London underground map, a wallet full of Pounds Sterling, a laptop and a cell phone. And I was wearing my favourite lucky suit - the one I wear every time I'm unsure about what I'm getting into - somehow, wearing the suit, I always come out on top.

Five, ten, twenty minutes go by. I move forward a few paces, no more. Twenty more minutes pass, another few paces - but what can you do except be patient like everybody else. Getting through immigration is the least of my worries on my 'Mission:Impossible'. Eventually, I get the stamp in my passport, and I'm on my way.

You see, where I come from it's always been easier to do business within my own country. Moving product is easy and stress-free. No headache, no problem. Just take the order, pack it, pick-up and deliver. Overnight delivery, standard insurance, no problem. This is a little different, a little more complex. Now, because of increased competition inland we're forced to focus our attention overseas as well. But now we face international shipping procedures, so our documentation had changed. Now there's rules and regulations that have never applied before, import duty and vat too. Do we pay it or will it be paid by the receiving customer? How do we achieve that? How do we make sure we abide by all the regulations? And that's why I am here - to establish the operation, employ a manager who knows about this stuff, who will in turn hire the necessary staff.

I paid up for an early check-in and went straight to my room. First things first - shower and a room-service breakfast. As I waited, I surfed the internet looking for suitable premises in a prime location. I knew roughly how much warehouse space was required, but I needed an office on site too, ideally close to the airport, preferably between the airport and the city, with easy access to major roads, motorways and public transport.

Morning turned to midday, to afternoon, to evening, and as it got dark outside, I was still in my room gathering information and making calls. I tell you, this wasn't as straightforward as I had hoped it would be - this was no easy task. Exhausted, I must have drifted off to sleep and the next thing I know, I wake up and find I've been using my laptop as a pillow. I crashed - must be the jet lag.

The next morning, notes in hand and dressed for business, I headed for the streets via the breakfast lounge where I grabbed some coffee and toast. First thing, I had to open a bank account and meet up with the various real estate agents I'd spoken to the day before. I'd also found somebody that was interested in the position of UK operations and development manager. So far, so good.

As I left the bank, I realised I'd no idea which direction to turn, nor how to get to my next appointment. I wandered into a coffee bar to ask for directions but - and this seemed to be a habit here - I stepped straight into a queue. So I waited. But I must have looked very lost, clutching my map, as the guy in the queue in front of me asked me where I was trying to get to. He realised I wasn't from the UK and when I said I was here on business, he asked me what line I was in. I found myself explaining my trading dilemma to a complete stranger. But then, in the way these things can sometimes turn out (and maybe just a little because of my lucky suit), I found I was talking to somebody, who knew somebody, who could most definitely be a real help to me - a customs and importation specialist.

He gave me a name, phone number and address and wouldn't you know, their office wasn't more than 5 minutes away. I made a call, hailed a cab and within minutes I was sat down with the guy from CCL, and my cappuccino was even still warm!

These guys are in the ideal location for me, close to the airport, en route to the city. It turned out, the way I could work with them meant I didn't need a warehouse, or an office, or even a single employee in the UK. Amazingly, I didn't even need my new UK bank account, although I thought it might be useful to keep it going for the time being.

The CCL people make the import process so straightforward. They move my goods into their warehouse; they clear them through customs; they organise deliveries and they even collect the import duty and vat from my customers. Now all I need is for that ever-so hungry sales team to do the business.

I could hardly believe it was so easy to sort it all out - my lucky suit strikes again! I re-scheduled my return flight (no need to stay all week now) and awarded myself the remaining day and a half for a little sightseeing and shopping. Well, with my Mission:Impossible not proving quite so challenging as I'd thought, why not?!

Return to top