Seafood import customs, tariffs and VAT
This page provides seafood importers in Great Britain with a step-by-step guide. Throughout the guidance Scotland, England and Wales is referred to as Great Britain or GB. Northern Ireland is operating under different custom rules through the Northern Ireland protocol. This is covered on our Trading seafood under the Northern Ireland Protocol page.
Checklist for importing to Great Britain from the EU
Seafood is imported into Great Britain via road, air or sea. The goods arrive at the border control post where they are checked. The duty and VAT is calculated and due for payment at the point of customs clearance if applicable.
There are 8 steps to consider when importing seafood from the EU to Great Britain.
The International Commercial Terms (known as incoterms), agreed during the terms of the sale, will define if the buyer or seller is responsible for import tariffs and VAT.
If the incoterms are DDP (delivered duty paid) the seller would be responsible for the duty and VAT. All other incoterms 2020 would deem the GB buyer responsible, meaning they will be the importer of record and liable for the duty and VAT if applicable.
The commodity code, sometimes referred to as the harmonised system code, is a ten digit code format used internationally. It is essential to know the commodity code of your items to ensure they are classified correctly and that the tariffs and VAT charges are correct. You can search for commodity codes on the government website. If you are still unsure, HMRC provide a help service for classifying your goods.
Once you know the correct commodity code, you can check the import tariff and VAT due using the government trade tariff tool. The third party duty is the most favoured nation rate which will apply based on world trade organisation rules. This import tariff is set for all world trade organisation member countries.
Some goods are eligible for zero tariffs under the UK - EU Trade and Cooperation agreement. To claim these tariffs the importer will have to meet the Rules of Origin criteria to determine that the goods can claim origin from the specified country and qualify for the rate. For more information on Rules of Origin, watch our webinar on our YouTube channel.
The government website also has an advance tariff search which allows you to input the commodity and country you are trading with. This will then tell you if there is a free trade agreement in place and show the rate, as well as the third party rate for comparison.
There are customs procedures that allow businesses to bring goods into GB without paying customs duty. It is important to look at your product journey and end use, to see if mitigating the duty is possible. These customs procedures are beneficial to those companies who are not bringing the goods into free circulation (for sale or use within GB).
When using any customs special procedures, traders are advised to contact HMRC for the necessary approvals. Please find below a brief description of some of the commonly used customs special procedures.
Inward processing can be used when goods are brought into GB for processing. HMRC’s legal definition of processing is:
“The use of the goods for the purpose of facilitating the production or manufacture of any other goods”.
An application must be submitted to HMRC before using this special procedure, where the applicant will give their description of the processing taking place. Using this procedure allows the duty and VAT to be suspended on import and if the goods are re-exported (with proof of an export declaration) the duty will be discharged. It is important to have authorisation prior to using this procedure and to complete a bill of discharge for HMRC.
Alternatively, you can import the goods for inward processing and the processed goods can remain within GB. Once the goods enter free circulation you would be liable for the duty. You may wish to use this procedure if you are processing your goods into a commodity that attracts a lower rate, which would allow you to save on duty.
Outward processing is where goods in free circulation are exported out of GB for processing and returned to GB. On return to GB the import customs duty will only be due on the value added from the processing. This means the original goods are not included in the value so you can save duty on that portion of the product.
Customs warehousing is when goods are sent into storage and the duty is suspended until the goods are released into free circulation. If the goods are re-exported (with proof of an export declaration) the duty will be discharged. This procedure may be useful if the goods are going to remain in storage for a while, meaning you do not have to pay the duty prior to the goods being sold. It is also possible to release the goods from customs warehousing and then enter them into another customs special procedure.
There are two types of customs warehousing, public owned or private owned. You must apply with HMRC to become a private owned customs warehouse.
End use relief
End use relief is a procedure that gives duty relief to goods imported and used for a specific purpose. It should be noted that this procedure does not include relief for VAT. Fish is included on the list of approved items which can use this procedure. Some seafood commodity codes have an autonomous tariff quota (ATQ) which allows businesses to import an agreed quantity of raw material on the condition that they are being used for processing or in the industrial manufacture of products.
Visit the government website for more information on what processes this can be used for.
You need the following document to import your goods:
- Invoice (stating EORI number)
- Packing List
- Bill of lading/cmr/airway bill
- Customs declaration
- IPAFFS notification
- Certification (health certificate, catch certificate, organic certificate)
Many traders will use a freight forwarder or customs agent to do the customs entry on their behalf. This ensures smooth movement of goods. The customs agent will use the documentation as set out above to make the custom entry. Visit the government website for guidance on finding an agent and the preparations you will need to make.
The customs declarations must declare what you intend to do. For example if you are trying to claim preferential tariffs you will need a supplier declaration. If you intend to use a special customs procedure the correct code needs to be selected on the declaration.
VAT registered businesses collect VAT at each stage of the supply chain on behalf of HMRC, this includes importation of goods into GB.
Food and drink, animals, animal feed, plants and seeds fall into the zero rate category for VAT. This means that the commodities are still VAT taxable although the rate charged is 0%. These imports will need to be included in your VAT returns. Businesses will complete a VAT return which allows them to take the amount of VAT collected on the sale of their product “Output tax” and minus any VAT paid to suppliers in the production process as “Input tax”. The difference is paid to or reclaimed from HMRC. For most seafood businesses the amount collected is less than the amount paid to suppliers, therefore you can reclaim the difference back from HMRC.
Please use the following as a guide to consider if you need to be VAT registered in the UK:
1. Are you trading over the UK threshold? You can find the current UK threshold on GOV.UK
If the answer is yes - go to question 2
If no – no registration required.
2. Are you the importer on record? Check who is responsible for import tariffs and VAT
If the answer is yes - you will need to list these transactions in your VAT returns.
If no – no registration required.
Traders may also consider voluntarily registering for VAT. This could be a commercial decision purely for the purposes of reclaiming input tax on overheads. VAT registered businesses are also required to register for Making Tax Digital.
If you have a question about importing seafood to Great Britain or any other seafood regulation queries, contact our Regulation team directly.