Tuesday, April 14, 2020

HMRC Assistance for Duty and VAT Deferment Welcome - But Problems Lie In Delays

Freight Forwarders Raise Complaints Over Lack of Response
Shipping News Feature

UK – First the good news. In response to the Covid-19 crisis last week the Customs authorities relaxed the rules on payment of import duty and VAT. The British International Freight Association (BIFA) which represents many of the country's forwarding agencies has been lobbying hard for several weeks as a member of the Joint Customs Consultative Committee (JCCC) for an easing of the regulations.

Those, and there are many, who are experiencing severe financial woes due to the pandemic, were told that deferred customs duties and import VAT due on 15 April could see whole or partial payment delayed provided the made an agreement with HMRC and thus avoided having their guarantee called upon or their deferment account suspended.

According to the BIFA website last week the help line numbers provided by HMRC would be active over the four day Bank Holiday period. Unfortunately this was not the case leading to many deferment account holders panicking as the deadline drew nearer as the lines either didn’t respond or informed callers the offices were closed, whilst emails remained unanswered.

A call to HMRC this morning confirmed that those entrusted with dealing with the situation did indeed not work over the Easter leaving the agents with just 24 hours to resolve the situation. For those duty deferment account holders who receive approval in time for a delay, theywill be able to use their accounts during the extended payment period agreed unless they default on a subsequent payment in that period, in which case HMRC may consider suspending their account.

Any outstanding payment will not affect their duty deferment limit so they will not need to increase their guarantee to cover the outstanding payment. Where HMRC agree to an extended payment period, interest will not be charged on the outstanding payments provided they are paid in full by the agreed date.

For those who have duty or import VAT payments not covered by a duty deferment account, again only in the case of severe financial difficulties, a request for an extension payment deadline should be made to HMRC when the payment is due. Cases will be judged on their validity on their individual circumstances.

If such a case is accepted, and there are no guarantees of this, the conditions of repayment, including the time allowed to raise the cash, will depend upon the importer’s individual circumstances and may require the holding of a guarantee for the period of the time extension. This facility will not be permissible for non-registered importers.

Further information on this point is available by contacting the Customs Debt Policy inbox on custdebtrr.customspolicy@hmrc.gov.uk

Duty deferment enquiries should be addressed to the Duty Deferment Office on 03000 594243 or by email cdoenquiries@hmrc.gov.uk

There is also a Covid-19 update Helpline on 0800 024 1222.