We all know that goods arriving in the UK from outside of the EU have to be declared to Customs (HMRC) and cleared for entry into the country. Part of this procedure calls for the assessment and payment of Import Duty and VAT, both of which need to be paid in order to complete the HMRC release process. Apart from a few select commodities, you’d be forgiven for thinking that duty and VAT is inevitably payable on everything we import.
In this day and age, saving money is a necessity. HMRC have approved a number of schemes by which onerous costs can be avoided altogether, or at least suspended for payment at a later date. Naturally there are rules to follow and a clear audit trail to maintain, but they are slight when compared to the easing of your cash-flow and the boost to your profit margin.
Here are four different ways the HMRC gives a stamp of approval to tax avoidance:
This is not just one for high value and Duty Free goods; it can also be used to store any commodity over an extended period of time. Duty and VAT will only be paid as and when all or part of the stock is withdrawn for sale or use.
Onward Supply Relief (OSR)
This will relieve you of the need to pay Import VAT if you are bringing goods into the UK to then supply to customers in other EU countries. The VAT is instead accounted for when it arrives at its destination.
Inward Processing Relief (IPR)
IPR will suspend the payment of Import Duty and VAT on goods or materials that you bring into the UK to re-work or process to ultimately re-export outside the EU as another commodity. Once you can prove you’ve exported the resulting items, you are completely relieved from paying these taxes.
Outward Processing Relief (OPR)
OPR gives you partial relief from Import Duty. If you’ve sent raw materials or parts from the UK (and EU) outside the EU to be manufactured into a commodity which you then import back into the UK, then you don’t have to pay Import Duty on the value of the originally exported goods.
These are just a few headline grabbing schemes that you may find useful. There are plenty of others available which focus on certain commodities, particular industries or select countries of origin.
If you’d like to know more about these schemes and take active steps toward easing your cash-flow and boosting profits, please contact Gordon Humphrey at email@example.com or call 01293 554620 for more information.