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Posted Tue, 28 Jun 2022 14:25:19 GMT by Green Car
Hello We are a small business, starting to export goods to Ireland. We sent some goods earlier in the year, £15,000 value, manufactured by us here in the UK Commodity code: 8413502000. We stated on the invoice Origin UK, but we have just had a bill for the duty. Our transport company who handles all paperwork for us (we just provide them with commercial invoices), says it's because we did not include a statement of origin on the invoice. They have given the following example of what needs to be included in the invoice: ‘’The exporter of the products covered by this document declares that these goods are of UK preferential origin. ‘’ It will also state the shippers GB VAT number in the above statement. We need to ship another order, commodity code 8425410000, next week. Value £50,000 My question is, do we just put this statement on there, or do we need to apply for some kind of proof of origin document from chamber of commerce, to be able to put this statement on the invoice? Chamber of commerce could not answer my question We are so very confused, and if we are charged duty again on this shipment, will lose almost all profit. Thank you Izzie
Posted Tue, 28 Jun 2022 16:59:41 GMT by Customs oldtimer
Your transport company is correct - just stating UK origin on your invoice will not suffice. We have a trade agreement with the EU that which sets out what the requirements are to claim the reduced/nil duty on import. What wasn't made clear in the press coverage is that for UK exporters it does not apply to all goods sent from the UK or even everything manufactured in the UK. It can be quite complex to understand. HMRC publish guidance here In short for manufactured goods 1. the goods must be processed beyond minimal processes such as repacking, cutting up etc - there is quite a long list 2. the goods must meet the product specific origin rule - so you need to look up the requirements for 8425 or 8413 in Annex 3 of the agreement. for 84 25 the rule is CTH except from non-originating materials of heading 84.31; or MaxNOM 50 % (EXW). This means that you have a choice of two rules CTH means everything not UK originating used in the manufacture must be of a different tariff heading to the finished product. You cannot however include non originating products in TH 8431. or no more than 50% of the value of the EX-Works price of the finished goods can be non UK originating. 3 If your goods meet the criteria you add the statement on origin to your invoice or other commercial document- you will need to use the wording specified . The exporter of the products covered by this document (Your VAT no) declares that, except where otherwise clearly indicated, these products are of UK preferential origin. 4. Your customer claims the reduced duty on import - the fright forwarder should know how to do this. You do not need proof of origin from the Chamber of Commerce - you are self certifying. If you have been charged I assume you have agreed this with your customer as it would be normal for the importer to pay the duty. It may be possible for the named importer to reclaim the duty retrospectively from the Irish Revenue of proof of preferential origin can be provided.
Posted Wed, 29 Jun 2022 07:02:43 GMT by Green Car
Thank you very much for prompt reply. Ok, so yes about 80% of the value of the goods are of UK origin, in which case we can use the second rule. I presume our incoterms DAP, mean that the duty has been charged to us, instead of the importer. How do we go about getting proof of preferential origin to be able to try and reclaim the duty from the Irish Revenue? Apply through the Chamber of Commerce? And just so we understand - when would we normally be required to provide proof of origin, if not in this circumstance?
Posted Wed, 29 Jun 2022 07:25:20 GMT by Green Car
And sorry I forgot to ask - if the goods were manufactured in Italy - would this be duty free, as manufactured in EU? We will have some other Italian made items to send at some point...
Posted Wed, 29 Jun 2022 08:12:39 GMT by Customs oldtimer
Under DAP Incoterms 2020 the seller has no obligation to clear the goods for import , pay any import duty or carry out any import formalities so your customer should be the importer and pay the duty. You and your customer should be clear on who is responsible for what and who is paying for what. You would provide the retrospective evidence yourself by providing the statement on origin wording on a replacement commercial document ie packing list or invoice. You will need to check the origin rule for each product as they may be different to the specific example I gave When you make a statement on origin you need to keep your own records that the goods meet the origin requirements as HMRC are entitled to verify this at a later date. If the goods are manufactured in Italy (EU) then they cannot go back to the EU under the trade agreement duty free, as the agreement doesn't cover returned goods. Goods returned to the EU can go back duty free only if you have details of the export declaration when they left the EU to prove they were originally shipped from the EU.
Posted Thu, 14 Jul 2022 08:06:26 GMT by HMRC Admin 20
Hi Green Car,

Good afternoon, the statement must be included on the invoice to allow preference to be claimed.
Please see below link.
Claiming preferential rates of duty between the UK and EU
Providng the preferce is correctly declared with the evidence provided you will be able to benefit from a reduced or nil rate of duty.

Thank you.

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