In this week’s EU exit corner, we bring you the latest guidance updates and publications relevant to EU exit. HMRC has also answered a query on VAT relief codes and their interaction with the Customs Declarations service and has sent an email about industrial action at ports and airports on 1 February 2023 with advice for movements of goods.
VAT relief codes
HMRC was asked how the VAT relief codes VATZ, 1RV and F45 should be used on import entries submitted via the Customs Declaration Service (“CDS”) as there is confusion amongst import agents and some entries are being rejected because the combined use of these codes with other data elements creates an error within the CDS.
HMRC’s response is as follows:-
“VATZ is a National Additional Code that a trader/agent would enter in Data Element (DE) 6/17. VATZ indicates that the goods are at the zero-rate of VAT, but can only be used where the commodity code itself has been configured with this VAT rate shown – for example, the comm code for T-shirts for men and boys has both the standard rate (no national additional code applicable) for men’s t-shirts and VATZ for the 0% VAT rate for boy’s t-shirts. Without entering the VATZ code the system will assume the goods are standard rated and apply the 20% VAT rate.
1RV is an Additional Procedure Code (APC) that’s entered in DE 1/11. This APC relieves VAT and should only be used where instructed by Customs or in the Tariff Volume 3/Declaration Completion instructions. When used it will demand that an Additional Information Statement is entered in DE 2/2 ‘RVAT1’ against which the trader/agent has to note the reason for the VAT relief being used.
F45 is another APC, however this is specifically tied to the C-series APCs that provide relief of customs duties for a whole range of reasons and must be combined with the C-series APC on the declaration to obtain VAT relief.
Documents can be uploaded when required via the upload service and that should be undertaken if instructed by CDS (a ‘DMSDOC’ message will be issued to notify of this) or when the guidance in the CDS Tariff requires this for a document specific procedure etc:
https://www.gov.uk/guidance/send-documents-to-support-declarations-for-the-customs-declaration-service”
Miscellaneous updated guidance etc.
The latest guidance updates, and publications relevant to EU exit are as follows:-