UK Customs: Are you prepared for the switch from CHIEF to CDS?
The UK transition to the Customs Declaration Service (CDS) begins this year, with all imports switching from CHIEF to the new system by October 2022, and exports from the UK switching by April 2023
The UK government aims to have the most efficient customs system in the world by 2025, and began its big shift to the Customs Declaration Service in August 2018 with phase one and two CHIEF system closures set to finalise the transition from September this year.
What are the changes?
The gradual closure of the current Customs Handling of Import and Export Freight (CHIEF) system will happen across two phases in late 2022 and early 2023, split between UK import and export customs.
The two phases will be laid out as below:
Phase one: UK import declaration submissions through CHIEF will cease as from Friday, 30th September 2022
Phase two: UK export declaration submissions through CHIEF will cease as from Friday, 31st March 2023
All customs declarations for goods imported or exported into the UK will then need to be done through the new Customs Declaration Service system.
What do you need to do?
Most businesses will already have a Government Gateway account to access their personal or business tax account. You should use this account to access the Customs Declaration Service.
You can register for a Government Gateway account if you don’t have one already here.
You need an Economic Operator Registration and Identification (EORI) number that starts with GB. Most businesses moving goods in and out of the UK already have one.
You can apply for an EORI number if you don’t have one already by clicking here.
Registering for the CDS can take up to five working days and can be done here.
You’ll need your Government Gateway user ID and password for your business.
You’ll also need:
- your GB EORI number
- your 10-digit Unique Tax Reference (UTR) number – you can find this on any HMRC payment reminders, or in your personal tax account
- the address for your business that is held on our customs records
- your National Insurance number (if you’re an individual or sole trader)
- the date you started your business.
If your freight forwarder is paying your VAT & Duty on your behalf and then invoicing this back to you, nothing will change to this method.
If you are accounting for VAT using Postponed VAT accounting, you will need to access your postponed VAT statement via the Customs Declaration Service.
The other options for paying your VAT and Duty are listed below. You can view your balance and payments in the Customs Declaration Service Financial Dashboard, as well as grant and amend standing authorities for your payment accounts.
If you have your own Duty deferment account
The Customs Declaration Service uses a separate HMRC bank account to CHIEF, so you’ll need to so you'll need to set up a new direct debit.
You will also need to re-authorise your freight forwarder to use your deferment account. This is done in the Customs Declaration Service Finance Dashboard.
- Duty deferment account – the Customs Declaration Service uses a separate HMRC bank account to CHIEF, so you’ll need to set up a new direct debit here.
- Postponed VAT accounting – if you’re making declarations for yourself, and your business is registered for VAT in the UK, find out when you can, or need to, account for import VAT on your VAT return here.
You can also choose:
- Cash account – these replace the Flexible Accounting System (FAS), and you’ll be set up with one once you’ve registered for the Customs Declaration Service, click here for more information.
- Immediate payment by Bacs, CHAPS, online or by telephone banking – you can pay by debit, corporate credit card or cheque, click here for more information.
- Individual guarantee – you can use these to cover customs duties for one-off or high value imports. Find out more here.
- General guarantee account – this allows you to provide multiple guarantees from the same account, and continue importing goods into the UK and pay a disputed amount later once agreed. Click here to find out more.
- You need to give us, your trusted forwarder or agent, customs clearance instructions, which are compliant with the Customs Declaration Service. You may need to:
- Use the Customs Declaration Service Finance Dashboard to set up, check or update which customs agents can use your accounts
- Let them know about any changes to your preferred method of payment
- Let them know about the incoterms, awareness for all values, the location information, and nature of transaction information.