Rob Jenkins, LLB (Hons), CEO and co-founder of customs duty consultancy Barbourne Brook warns of the crippling implications of incorrect Inward Processing (IP) administration following the court ruling against Thyssenkrupp Materials (UK) Ltd which led to a duty demand of £2.4 million customs duty and £6.4 million import VAT.
“Businesses should take urgent note of the implications of minor errors in IP reporting after TM suffered a complete loss of relief following a small number of errors on the monthly return.
The case gives HMRC a green light for doubling down on Inward Processing checks just when they are under pressure to increase the tax take and reduce the perceived tax gap. Since Brexit, customs duties flow into the UK Exchequer, not the EU Commission.
If you operate Inward Processing then you must check you meet all conditions of the authorisation and the return is completely accurate, timely and complete. Failing to do so could result in a hefty duty demand, loss of ongoing saving, reputational damage and severely compromised profit margins.
At Barbourne Brook we now have a tried and tested methodology for implementing and operating IP that has withstood HMRC scrutiny on behalf of many multinational clients.”
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If you have questions or queries about how this may be relevant to your business and the measures you can take to protect it, contact our team for an informal discussion.
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