Customs Handling Import and Export Freight system to close for good (and for goods!)

Well one further change of note comes into force from 1 October with the closure of the Customs Handling Import and Export Freight system (CHIEF) for import declarations. All new declarations must from this point must be made on the Customs Declaration Service (CDS) using software that talks the same language as HMRC’s new favourite toy.

The new system has been running alongside the existing CHIEF service for some time but an August Institute of Export & International Trade webinar found less than 40% of attendees felt prepared to use the new CDS system. Indeed HMRC’s own figures show 3,500 businesses are still using CHIEF and have yet to switch to CDS for imports at the beginning of August.

This is because this is more than just a change in the software being used but an increase in the data required by HMRC and in the overall level of scrutiny on import businesses. The Covid-19 pandemic may have seen HMRC ease up on regulatory inspections and fines for non-compliance in all areas, but expect these to ramp up as we continue to recover post-pandemic and Government focuses shift back onto such matters.

Many importers will of course use agents to do the paperwork, which increased substantially once the UK finally left the EU, and take the hassle away from the business owner. The majority of agents will no doubt be well aware of such changes but it may be worth checking they are set up well in advance of the 1 October deadline – better safe than sorry as they say.

Government advice warns that it can take ‘several weeks’ to register and be fully set up on the CDS system and with increasing demand for registrations likely during September it may be prudent to make plans to ensure your goods can continue to enter the UK no matter who completes your declarations.

Importantly those who use duty deferment accounts to delay payment of import taxes and duties until the submission of the VAT return will need to update their direct debit instructions or risk getting caught out by the requirement to make payments upon import.

Exporters may have a 6 months grace period but should also be aware CHIEF will close for good (and for goods!) on 31 March 2023.

Forrester Boyd Chartered Accountants provide expert guidance and advice to businesses throughout the Humber and Lincolnshire. If you would like to talk to us about your accounting needs, audit, tax advice or business finances, do get in touch for an informal initial consultation by either calling 01472 350601 or email us here.