When international sales fall short, returning stock across borders can quietly drain your profit, unless you plan ahead.

Stock that doesn’t sell is an operational reality, but you can limit the financial burden. For UK retailers and wholesalers, returning goods from the US without planning can lead to double duty payments and wasted margin. With the right customs strategy, it doesn’t have to. 

This article explores how businesses can reduce duty costs through proactive planning. It focuses on the underused but powerful tool of US Drawback and includes a real-world case study showing how quickly costs can escalate when customs is left out of the conversation. 

The Pain Point: Paying Twice … or More 

Many UK businesses have stock sitting in the US that hasn’t sold. The most practical commercial decision is to bring that stock back to the UK and sell it through domestic channels such as factory shops, outlets, or bulk clearance. 

But for goods like clothing, the numbers can quickly hurt: 

  • US import duty on clothing often sits at 20%+ 
  • Bringing the same stock back into the UK can trigger another 12% UK duty 
  • And if the goods originally came from the UK, that duty was already paid once before export 

What started as a straightforward re-export decision becomes a costly loop of duties on the same goods. But it doesn’t have to be that way.

Case Study: When T-Shirts Travel Without Planning 

A UK-based business manufactures 100,000 t-shirts and exports them to the US, planning to sell them B2B at $20 per unit. However, due to lower-than-expected demand, only half the stock sells. The remaining 50,000 units are returned to the UK. 

Movement Summary

Movement

Duty Paid
(No Planning)

Duty Paid
(With Planning) 

UK → US 

£200,000 

£0 (via drawback)

US → UK (returned stock) 

£48,000 

£0 (via RGR) 
Total Duties  £248,000 

£0 

The Solution: Reclaim and Relief 

Reclaim US Duty: Drawback 

  • The US allows businesses to reclaim duty on goods that are re-exported, but it’s not automatic: Claims must be filed within five years of import 
  • Applies to unsold stock, not customer returns.
  • Substitution and FIFO/LIFO stock matching is allowed.
  • Requires strong documentation linking import, inventory, and export.

Done properly, drawback can return significant sums. Done late or poorly documented, it’s a missed opportunity. 

Avoid UK Duty: Returned Goods Relief (RGR) 

On the UK side, RGR prevents paying duty twice: 

  • Applies to goods returned within three years of export. 
  • Must prove UK origin and unaltered condition.
  • HMRC expects a clear audit trail and may review up to three years post-import.

The Strategic Value of Customs Planning 

This case shows that customs isn’t just a back-office issue; it’s a commercial one. Planning for possible returns at the point of first export gives businesses the tools to: 

  • Avoid unnecessary costs.
  • Protect gross margin.
  • Stay agile across international markets.

How Barbourne Brook Can Help 

We help businesses uncover opportunities others miss: 

  • US Drawback: In partnership with a specialist US firm, we handle the end-to-end process—filing, documentation, and progress tracking 
  • UK RGR: Our team ensures your evidence is complete and your claim stands up to audit 
  • Data and audit support: We use tech-enabled tools to link declarations, stock records, and movement data 
  • Contingent fees: No up-front costs; we recover the savings, and we share the risk 
  • Broader customs strategy: Where RGR or drawback isn’t possible, we advise on classification, valuation and relief alternatives 

If you have stock in the US that needs to come home, don’t let duty costs undo the value of recovery. 

Rosanna Hood - Head of Customs Innovation

Talk to Barbourne Brook. Let’s make sure you don’t pay twice. 

business strategy customs brokers customs duty consultants Operations